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Ministry of Economic Development rejects Chamber’s objections to Free Zones Law and defends tobacco ban

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The Chamber of Commerce of Montenegro (PKCG) has raised concerns over certain provisions in the draft Law on Free Zones, arguing they may be discriminatory toward foreign companies. Under the current proposal, only companies registered in Montenegro can obtain the status of a free zone user. PKCG says this prevents direct participation of foreign companies, contrary to international practice. They suggest alternative oversight measures such as appointing an authorized representative in Montenegro, requiring a guarantee deposit, or introducing enhanced customs controls for non-residents.

The Ministry of Economic Development (MER), which proposed the law, rejected this criticism, saying local registration ensures effective oversight by customs, tax, security, and law enforcement authorities, while preventing money laundering and terrorism financing. MER also noted that company registration in Montenegro is quick, inexpensive, and not a real barrier to foreign investors.

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PKCG also opposed the absolute ban on activities involving tobacco and tobacco products, including storage, transit, and processing, arguing that stricter control mechanisms could prevent abuse without a full ban. MER defended the ban, citing high risks of tobacco smuggling from free zones, highlighted by the European Commission, Europol, and Frontex. They said previous attempts at enhanced oversight without a ban failed due to limited control capacities, and that the fiscal cost of constant monitoring would outweigh potential legal revenues from tobacco transit.

MER also rejected a proposal from the NGO Action for Social Justice to extend the ban to all excise goods, saying there is no comparable evidence of systemic abuse for products like alcohol, coffee, and mineral oils.

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