Why going private is (was) prohibited in Serbia?

Abstract

This paper deals with the problem of permissibility of public companies’ going-private transactions in Serbia. The Securities Commission of Serbia caused that problem by an odd interpretation of the current Serbian securities law. It is of the opinion that going-private of public companies in Serbia is prohibited due to a loophole in the Securities Market Act concerning the procedure for the process. That was the ground for the Companies Register to start the practice of denying the registration of conversion of public companies into private ones. Тhe courts confirmed that practice as the legal one in judicial review procedures, which stopped going private process in Serbia for a longer time in spite of the explicit statutory permission. The paper points out that such a practice is illegal, because it is not grounded on the law, but on the decision-makers’ arbitrariness.