The Union of Municipalities of Montenegro submitted an amendment to the Parliament concerning the Draft Law on the Management of State-Owned Companies, with the aim of enabling the functioning of municipal companies that perform non-commercial activities.
The Draft Law does not take into account the functioning of these business entities, as they are not exempt from the prescribed obligation requiring companies to cover at least 50 percent of their operational costs in accordance with accounting regulations. It is clear that companies performing non-commercial activities cannot meet this requirement.
These are business entities recognized under the Law on Communal Activities, which allows for the establishment of companies to perform communal services of shared public consumption, where the service cannot be measured or otherwise individually determined and charged for. The Law on Spatial Planning also provides for the establishment of companies by the Government and local self-government units for the preparation of planning documents, which likewise do not provide commercial services.
The explanation accompanying the proposed amendment states that the establishment of these companies cannot be conditioned on covering at least 50 percent of their operational costs from revenues generated through the sale of goods or the provision of services on the market, given that they do not place goods or services on the market and are financed entirely from the budget of Montenegro or the budgets of local self-government units.
