The commercial discussion is usually about price and debt. The regulatory one is about a single word in a decision nobody at the table has read: the name of the ugostitelj.
Montenegro's hospitality statute does not issue an approval to a building. It issues it to a named operator, and it records that name in a public register. Which deal structure you choose decides whether that name changes — and, either way, it starts a clock measured in days.
This is a question about a file, not about the asset's quality.
The statute is the Zakon o turizmu i ugostiteljstvu ("Sl. list CG", br. 002/18, 004/18, 013/18, 025/19, 067/19, 076/20, 130/21, 084/24).
What the approval is actually attached to
Read the first data item in article 75 stav 1. The odobrenje za obavljanje ugostiteljske djelatnosti — the approval to carry on hospitality activity — contains the name and seat and registration number of the operator, or, for a natural person, the name, address and personal identification or passport number. Only after that does it list the object: type, name, category, address, the description of services, the business model where the condo or mixed model is used, the activity code, and the number and structure of accommodation units.
The same structure repeats in the register. Article 78 stav 2 point 1 records, first, the identity of the applicant; the object's location and type come afterwards.
So the licence layer is organised around a person. That single fact is what makes the two deal structures diverge, and it is why the choice is not only a tax and liability question.
| Share deal | Asset deal | |
|---|---|---|
| Who is the ugostitelj afterwards | The same legal person | A different legal person |
| The approval and register entry | Stay with that person | Do not travel with the building |
| What still changes | The data about that person | Everything about the operator |
| Notification duty | 8 days, art. 75 st. 2 and art. 78 st. 4 | The acquirer must establish its own position |
| Employees | Employer unchanged | Employer changes — Labour Act art. 108 engages |
The eight-day duties that apply even when nothing seems to move
This is the part that catches share-deal buyers, precisely because they were told nothing changes.
Article 75 stav 2 obliges the operator to notify the Ministry or the competent local authority of every change to the data in stav 1 — which includes the operator's own identifying data — within eight days of the change arising. Stav 3 gives the authority eight days to issue a decision on that change.
Article 78 stav 4 runs in parallel for the Central Tourist Registry: where data entered in the register change, the operator must notify the competent authority in writing within eight days.
In a share deal the company keeps its approval, but its registered particulars move: ownership, and usually the representative. The obligation is on the operator, it is measured from the day the change arises, and nothing about it waits for the commercial closing to be tidied up.
What the category is, and what it is not
Article 84 sets out which objects are subject to categorisation at all — hotels and the listed types, with a long list of exclusions including eco lodges, hostels, katuns, bars, bakeries and catering objects. Categorisation is done by awarding stars, to a maximum of five, and objects of three stars or more with particular facilities may be given a specialisation.
Article 85 stav 1 then says something worth reading literally: a change of category is carried out in the manner and by the procedure prescribed for determining the category. There is no lighter procedure for a change than for the original grant.
And stav 2 is the operative prohibition: an object that ceases to meet the prescribed conditions for its type and category may not operate under the designation of that type and category. Stav 5 adds the enforcement route — where an inspection finds the object does not meet the awarded category and specialisation, the operator must apply for re-determination within eight days of the inspector's record.
That is the honest shape of the risk. The exposure is not that a star rating quietly expires; it is that operating under a designation you no longer satisfy is itself prohibited, and that the route back is the full procedure.
What we could not verify, and why we are saying so
We searched the consolidated statute for an express rule that a categorisation decision lapses when the owner of the object changes. We did not find one. The phrase does not appear, and neither does an article addressing a change of owner in the categorisation chapter.
What the statute does regulate expressly is the lapse of a travel agency licence — article 24 provides that a licence ceases to be valid on the holder's request or on the agency's deletion from the CRPS, and that the agency is then removed from the Central Tourist Registry by decision. That is a different instrument for a different activity, and we mention it only to show that where the legislature wanted an express lapse rule, it wrote one.
So we state the position we can support and no more: the approval and the register entry identify a named operator; a change of that operator's data carries an eight-day notification duty; and an object may not trade under a designation whose conditions it no longer meets. Whether a specific transfer requires a fresh categorisation for the acquirer is a question to put to the competent authority on the facts of the object, before completion rather than after it — and it is a question with a documented answer, not a matter of opinion.
The layers this page deliberately does not repeat
Two large parts of the hotel M&A analysis are already settled elsewhere on this site, and repeating them here would only make them harder to find.
Employees. Where the transaction changes the employer — that is, in an asset deal rather than a share deal — article 108 of the Labour Act engages: the successor takes over the employees on their existing terms, the predecessor must notify each employee in writing at least fifteen days before, the successor is jointly liable for employment obligations arising up to the transfer, and a new contract must be signed within five days without reducing the scope of rights. The full treatment, with the surrounding liability and tax analysis, is on our page comparing asset deal and share deal. One currency note: the consolidation we could obtain runs to 86/2024, and we could not source a consolidated text carrying the later amendment.
Categorisation from the unit buyer's side, including which model a hotel may use and why converting an existing hotel is close to shut, sits on our condo hotel page. The incentive layer — and which incentives survive contact with the statute — is set out under tourism incentives.
What we look at first in a hotel transaction
- The approval itself, not a summary of it: who is named as ugostitelj, what type and category the object carries, and what business model is recorded under article 75 stav 1.
- The Central Tourist Registry entry and its date, against the approval. Where the two disagree, the disagreement predates you and becomes yours on completion.
- Whether the object today still meets the conditions for its designation — because article 85 stav 2 prohibits trading under a designation whose conditions have lapsed, regardless of who owns it.
- The eight-day exposures already running: any change of data since the last notification under article 75 stav 2 or article 78 stav 4, and any inspector's record that started the clock in article 85 stav 5.
- The deal structure against the operator question: if the acquirer must become the operator, the licence position is a condition to completion, not a post-closing task.
- The employment position, on the analysis linked above, since it engages in one structure and not the other.
Whose side we are on, and how we are paid
Almost everyone else in a transaction is paid by the transaction. The agent's commission depends on the sale completing. The seller's advisers work for the seller. The notary's duty runs to the deed, not to you. None of that is improper, but it is worth knowing before treating any of them as your adviser.
We take no commission from sellers, developers, agents or intermediaries — in any form, in any file. Our only income is the fee you pay, and it does not increase if you sign. Telling you that the licence does not travel with the building costs us nothing. We pull register extracts and decisions ourselves rather than accept them from the other side, and we read a document from your position rather than from the position of getting it closed. When the answer is "not like this", you get it in writing.
One boundary is not negotiable: we are lawyers, not licensed investment advisers. We give no personal investment advice on financial instruments and we do not tell you whether an asset will rise in value. What we protect is your legal position — title, contract, registration, status, and the deadlines that govern all four.
How we open this file
Our first output is not a call. It is a written legal position. Send us the operating approval, the Central Tourist Registry decision, the company extract, and the draft transaction documents in whatever form they exist. You get back work of a scope agreed in advance: who is the operator before and after on each structure, which notifications fall due and when, whether the object's designation is currently supportable, and which of these belong in conditions precedent rather than in a post-closing list. Where we cannot answer from the statute, we say so and tell you which authority can.
We do not offer free consultations. The reason is plain: in a file like this the first hour is analysis rather than sales, and whoever gives it away is either not analysing it or is being paid by somebody else. This is also the substance behind our hotel investment work.
