On 3 December 2025, the National Assembly of the Republic of Serbia adopted amendments to the Alternative Investment Funds Act (Zakon o alternativnim investicionim fondovima). The primary objective of these amendments is to transpose the consolidated provisions of Directive 2011/61/EU on alternative investment fund managers (“AIFMD“) and to create conditions for the direct application of Regulation (EU) 2015/760 on European Long-Term Investment Funds (ELTIF) upon Serbia’s accession to the EU.
The original Act, enacted in 2019, represented Serbia’s first step toward aligning its regulatory framework with European Union standards in the area of alternative investment funds (“AIF“). The recent amendments further this harmonization, particularly in areas where EU regulations have been amended since the adoption of the original Alternative Investment Fund Act. However, the practical impact of these changes is limited, as most provisions will only take effect once Serbia becomes a member of the European Union—a milestone that remains uncertain.
Cross-Border Marketing
The concept of “pre-marketing activities” and the regulation of the conditions under which alternative investment fund managers (“AIFM“) may engage in such activities represent a significant novelty introduced by the amendments. Pre-marketing refers to the initial stage when an AIFM tests investor interest in a potential fund concept before formal marketing begins and without triggering full marketing compliance obligations. The rules prevent pre-marketing from becoming de facto marketing by prohibiting binding offers. Pre-marketing is permitted only if the information provided does not enable investors to commit to an investment, does not include subscription forms, and does not constitute final constitutional or offering documents or a prospectus. Draft documents may be shared solely if they are clearly marked as incomplete and not constituting an offer. Within two weeks of starting pre-marketing, AIFMs must notify the Serbian Securities Commission of its pre-marketing activities. In addition to the pre-marketing, the amendments introduce new provisions on cross border marketing, such as a possibility to withdraw a filed marketing notification.
AIFM reporting obligations to ESMA
To achieve transparency and ensure Serbia’s regulatory system is fully integrated with EU supervisory practices, the amendments impose obligations on Serbian AIFMs to report quarterly to European Securities Market Authority (ESMA) on every issuance, modification, or revocation of their operating license. Furthermore, the law requires that certain information must be submitted to the European Single Access Point (“ESAP“) or to the authority responsible for collecting data in line with the EU regulation establishing ESAP.
Integration of ELTIF
The amendments introduce specific provisions on European Long-Term Investment Funds (ELTIF) and extend the existing rules for European Venture Capital Funds (EuVECA) and European Social Entrepreneurship Funds (EuSEF) to also cover ELTIF. This alignment ensures that Regulation (EU) 2015/760 on ELTIF can be applied directly once Serbia becomes a member of the European Union.
Managing securitization risks
The Act introduces rules for AIFM when being exposed to securitization positions. Thus, if a Serbian AIFM or any AIF it manages is exposed to securitization, AIFM must assess whether the securitization meets the criteria contained in the EU regulation on simple, transparent and standardized securitisation (i.e. REGULATION (EU) 2017/2402 of 12 December 2017 laying down a general framework for securitisation and creating a specific framework for simple, transparent and standardised securitisation). If not, the AIFM must evaluate the impact of securitization on investors and adopt corrective measures to reduce or mitigate risk. These measures must be updated at least annually or whenever exposure changes and documented for review by the Securities Commission.
Retail investor protection
The updated law changes the regime for offering AIF units to retail investors in Serbia. While prior approval from the Securities Commission remains mandatory, AIFMs are now subject to additional obligations designed to enhance investor protection. AIFMs must implement and adhere to stringent procedures governing subscription, redemption, and related payments for fund units. They are also required to provide transparent information regarding payment methods and ensure that investors have easy access to their rights and to key documents, including annual reports, fund rules, and the latest net asset value of the fund. When offering AIFs from third countries, AIFMs must also demonstrate that investors enjoy an equivalent level of protection.
Technical clarifications and improvements
In addition to EU-driven changes, the draft law introduces technical clarifications and consolidates previously fragmented provisions to improve legal certainty and ease of application. For example, it specifies how ownership rights of AIFs without legal personality should be recorded in public registers, addressing practical challenges in real estate investments and strengthening investor protection. Furthermore, the amendments have removed numerous references to the UCITS Act in relation to the regulation of AIFs with public offerings, and instead, now directly regulate the operations of AIFs with public offerings within the draft law itself.
