Limitation of Claims in Serbia: When a Company Loses the Right to Enforce a Debt

At first, an unpaid bill often looks like an ordinary delay. The business partner asks for a few extra days, promises payment or suggests that the obligation be settled after the next payment. The problem arises when weeks grow into months, and months into years.

Then debt collection is no longer just a question of liquidity, but also a limitation issue.

For a company that does not have a system for monitoring due obligations, this can represent a serious legal risk. Especially because for certain business claims, the deadlines may be shorter than the creditor expects.

It is important, however, to immediately clarify one common misconception: statute of limitations does not mean that the debt automatically ceases to exist. It gives the debtor the possibility, under the conditions prescribed by law, to invoke the statute of limitations and thereby prevent the successful enforcement of the claim.

What Does Limitation of Claims Mean?

The statute of limitations occurs when the time specified by law has passed during which the creditor could demand the fulfillment of the obligation.

This does not mean that the debt disappears.

If the claim becomes time-barred, the debtor can file a statute-of-limitation objection in the appropriate procedure. As a rule, the court does not take into account the statute of limitations ex officio, but only if the debtor invokes it.

That is why the expression “the company loses the right to collect the debt” is often used in a practical sense, but legally it is not completely precise. The claim does not automatically cease to exist, but the possibility of its enforced collection may be seriously threatened.

This is also confirmed by the fact that a debtor who voluntarily pays a time-barred obligation cannot claim a refund just because at the time of payment he did not know that the statute of limitations had begun.

When Does the Limitation Period Begin?

As a general rule, the statute of limitations begins on the first day after day when the creditor had the right to demand the fulfillment of the obligation.

In business practice, therefore, the due date is particularly important.

If, for example, it is agreed that the obligation to pay is due 30 days after the invoice is issued, the limitation period is not calculated simply from the date the invoice was issued, but in relation to the moment when the creditor acquired the right to demand payment.

That is why the company should track at least:

• the date of origination of the claim,
• the due date,
• the legal basis of the claim,
• any subsequent actions of the debtor or creditor that may affect the statute of limitations.

This is especially important for companies that have a large number of customers and continuous delivery of goods or service.

What is the statute of limitations for claims between companies?

There is no single statute that automatically applies to every debt between two companies.

The general limitation period according to the Act on Obligation Relations is ten years, except when a special period is provided for a certain type of claim.

For business practice, a shorter period related to certain mutual claims of legal entities is particularly significant.

Three-year time limit for certain claims from trade of goods and services

Mutual claims of legal entities from contracts for the trade of goods and services, as well as certain claims in connection with such contracts, expire in three years.

This time limit should not be automatically applied to every claim just because both the creditor and the debtor are companies.

First of all, determine the legal nature of the specific relationship.

It is also important that the statute of limitations is calculated separately for each individual delivery, work performed or service provided.

This means in practice that a company that has ten unpaid invoices to one customer should not only look at the total balance. The oldest claims may be close to expiration even though the newer ones have only recently become due.

Special deadlines for other types of claims

For certain claims, the law provides for special deadlines.

For example, the statute of limitations for rent is regulated separately, while for some other types of contractual and non-contractual relationships different rules may apply.

it is not enough to determine just how old the debt is. It is also necessary to know from which legal relationship it originates.

What if the claim has already been established by a court decision?

For claims that have been established by a legally binding court decision, by a decision of another competent authority or by an appropriate settlement, different rules may apply than for the original claim.

Such claims, as a rule, expire within ten years, even when the original claim was provided for a shorter period, with legal exceptions.

This is another reason why the statute of limitations cannot be assessed only on the basis of the fact that “the debt has existed for several years”.

What interrupts the statute of limitations?

For the creditor, one of the most important questions is whether the statute of limitations has been interrupted in the meantime.

When the statute of limitations will be interrupted, the time that passed before the interruption is no longer included in the new deadline. After the interruption, the statute of limitations begins to run again according to the legal rules.

Two situations are particularly important for business practice.

Acknowledgment of debt

The statute of limitations is interrupted when the debtor acknowledges the debt.

That acknowledgment of debt can be explicit, for example when the debtor confirms in writing that a certain amount is owed.

However, recognition can also result from the behavior of the debtor, such as:

• partial payment,
• payment of interest,
• giving appropriate security.

It is important, however, not to equate every communication with acknowledgment of debt.

A message like “we will check the invoice” or “we will let you know when we can pay” does not necessarily have the same legal effect as a clear acknowledgment of a specific obligation.

That is why the content of communication with the debtor should be viewed carefully.

Initiation of court or other appropriate proceedings

The statute of limitations is also interrupted by the filing of a lawsuit, as well as by other appropriate actions taken by the creditor against the debtor before the court or other competent authority in order to establish, secure or realize the claim.

Depending on the documentation and legal basis, collection may require the initiation of civil or enforcement proceedings.

The key is to take appropriate legal action in a timely manner.

Does a pre-action payment demand break the statute of limitations?

No. A pre-suit warning alone does not break the statute of limitations.

This is one of the most important things that companies should know.

A written or verbal call to the debtor to fulfill an obligation is not in itself sufficient to break the statute of limitations.

A pre-suit warning can therefore be very useful as a means of collection. It can encourage voluntary payment, open room for negotiation or show that the creditor will take further legal steps.

But it should not be treated as a substitute for action that under the law actually affects the statute of limitations.

A company that has been sending reminders, emails and urgent calls for three years may therefore find itself in a less favorable position than it expects if it has not taken legally relevant action.

Example from business practice

Suppose that Company A delivered goods to Company B.

The invoice was due on May 15, 2023, but was not paid.

During 2024, Company A sends several emails and two reminders. The debtor replies that he currently has liquidity problems and that he will “try to settle the obligation as soon as possible”.

During 2025, communication continues, but there is no payment, no clear recognition of the debt or initiation of the appropriate procedure.

At the beginning of 2026, the creditor decides to more seriously consider further steps for collection of claims from a company. In that situation, it is not enough to conclude: “Well, we warned them all the time.”

It is necessary to determine:

• which limitation period applies to the specific claim,
• when it started to run,
• whether the debtor has acknowledged the debt in a legally relevant way in the meantime,
• whether there was another action that broke the statute of limitations.

An example shows why lengthy negotiations and informal communication are not a sufficient substitute for controlling deadlines.

The most common mistakes companies make

Waiting too long for a good business relationship

The company does not want to “spoil the relationship” with an important customer and therefore postpones formal payment for months.

Such a decision may be commercially understandable, but it does not affect the course of legal deadlines.

A good relationship with the customer is not a legal protection against the statute of limitations.

Relying on emails and telephone conversations

A large number of messages from the creditor does not automatically mean that the statute of limitations has broken.

Evidence should be distinguished that the creditor was trying to collect a debt from an action that has a specific effect on the statute of limitations.

Wrong belief that every warning “renew the term”

It does not renew.

A pre-action payment demand or a demand for payment alone does not constitute an interruption of the statute of limitations.

Following the total balance instead of individual claims

With continuous cooperation, one customer can simultaneously have new accounts and receivables that are several years old.

If only the total balance is observed, the oldest accounts can easily go unnoticed.

Waiting for the last weeks

Even when the deadline has not yet expired, reacting at the last minute is not a good strategy.

Before starting the procedure, it is often necessary to review the contract, invoices, evidence of delivery or service performed, communication with the debtor and possible collateral.

How Can a Company Reduce the Risk of Its Claims Becoming Time-Barred?

The most important thing is that collection does not depend on whether someone will “remember” the old invoice.

The company should have system.

First, each invoice should be tracked by due date, not just by customer and total balance.

Second, it is useful to define internal escalation points. For example, certain receivables after a predefined delay period no longer remain with sales or accounting, but are forwarded to the legal team or a lawyer for evaluation.

Third, it is necessary to distinguish between commercial communications and legal actions that affect the statute of limitations.

Fourth, contracts, invoices, purchase orders, delivery notes, minutes, confirmations of services performed and communications with by the debtor.

Fifth, any acknowledgment of debt, partial payment or provision of security should be recorded and preserved.

Sixth, the oldest claims should be reviewed periodically according to their legal nature, not only according to their accounting age.

When Should Legal Assessment Become Part of Debt Collection?

It is not necessary that every an invoice that is a few days late immediately becomes a legal matter.

But the company should know in advance when the claim ceases to be just a commercial problem and becomes a legal risk.

This especially applies to situations when:

• the debt lasts for a long time,
• the debtor disputes the basis or amount of the claim,
• negotiations are repeated without a concrete result,
• there are a large number of old invoices,
• the debtor shows signs of financial problems,
• it is not clear whether the statute of limitations has been interrupted,
• the relevant deadline for taking legal action is approaching.

Then it is necessary to assess not only whether the debt exists, but also what is the most legally effective next action: continuation of negotiations, attempt to clearly document or secure the obligation, initiation of enforcement proceedings or commercial litigation.

Conclusion

The limitation of claims is not only a matter for the legal service. It is part of the company’s financial risk management.

The three-year period is particularly important for certain claims from the turnover of goods and services between legal entities, but this period cannot be automatically applied to every business debt.

It is equally important to know what breaks the statute of limitations and what does not.

Remarks, emails and phone calls can have great commercial importance, but they do not necessarily protect the creditor in themselves. from the expiry of the term.

The safest approach is therefore not to wait for the last moment, but to systematically monitor the maturity and timely assessment of the oldest and riskiest claims.

Frequent questions about the statute of limitations for claims

What is the statute of limitations for claims between legal entities?

For certain mutual legal entities from contracts on the sale of goods and claims the service is valid for three years. Different deadlines may apply to other types of claims, so it is necessary to establish the legal basis of the specific debt.

Does a pre-action payment demand break the statute of limitations?

No. Merely sending a notice or other summons to the debtor to pay the debt is not enough to interrupt the statute of limitations.

Does acknowledgment of debt interrupt the statute of limitations?

Yes. The statute of limitations is terminated by recognition of the debt. Acknowledgment may be express, but under certain circumstances it may result from partial payment, payment of interest or provision of security.

Does a debt cease to exist when it expires?

No. The statute of limitations does not automatically erase a debt. It enables the debtor to refer to the statute of limitations and thereby oppose the forced realization of claims.

Does the court itself take into account the statute of limitations?

No. As a rule, the court does not take into account the statute of limitations if the debtor has not invoked it.

What is the general statute of limitations?

The general statute of limitations is ten years, except when the law prescribes another period for a specific claim.

Does the initiation of court proceedings interrupt the statute of limitations?

Yes. The statute of limitations is interrupted by filing a lawsuit or other appropriate action by the creditor before the competent authority in order to determine, secure or realize the claim.