The legal structure of Bosnia and Herzegovina (“BiH”) is very complex, which directly impacts on legislation as well as policies regulating and supervising companies and their directors.
BiH consists of two separate and distinct administrative entities: Federation of Bosnia and Herzegovina (“FBiH”) and Republika Srpska (“RS”), plus the Brcko District (“BD”) as a separate administrative unit. The two entities and the Brcko District have their own governmental structures as well as legislation, regulations and policies, so company law may be subject to legislative provisions at entity level, i.e. at FBiH, RS or BD level. Directors of affected companies can use the available measures adopted by the competent government in order to relieve the negative impacts caused by the COVID-19 crisis, but as mentioned above, each government (i.e. FBIH or RS and BD) adopts its relief measures independently so the measures may differ between them.
During March 2020, the government of FBiH issued recommendations for employers and employees, mostly referring to protecting the health of employees in the manner of, for example:
- reducing working hours
- reorganising the work process in shifts
- instructing employees to work from home and to take leave, both paid and unpaid
- issuing instructions on how to organise non-cancellable meetings
- ensuring the implementation of hygiene measures in the company’s facilities, and
- providing employees with protective equipment (e.g. masks and gloves).
All the above recommendations are applicable if the nature of the work process allows and they are in accordance with the company’s internal acts, employment rulebook, collective agreement and the law.
Statewide measures
Both the Banking Agency of RS and the Banking Agency of FBiH have adopted several banking and finance measures to mitigate the effects of the COVID-19 crisis, mainly relating to manner of loan repayment.
Additionally, all governments in BiH have prescribed direct price control measures for certain goods and services during the COVID-19 crisis.
To mitigate the effects of the COVID-19 crisis, the Foreign Trade Chamber of Bosnia and Herzegovina may issue, under specific conditions, Vis Maior (i.e., force majeure) confirmations which enable affected companies to demonstrate to their abroad business partners that they are unable to fulfil their contractual obligations for objective and/or unforeseeable reasons.
Furthermore, governments in BiH may adopt additional relief measures, as said was case in 2020, depending on the COVID-19 situation on relevant area. Generally, many of those relief measures introduced in 2020 (e.g., subsidising contributions for compulsory insurances, method of payment of tax obligations, etc.) were introduced in connection to a declared state of emergency which introduced a lockdown of certain businesses, and therefore these measures expired when state of emergency was revoked on relevant area of BiH.
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