On 5 January 2015, the Ministry of Finance issued an opinion No 011-00-64/2014-04 which establishes that services which local CROs provide to foreign affiliates do not qualify as services of clinical trials, on the basis that such services may be provided only by registered healthcare institutions. Instead, the Ministry stated, local CROs provide the services of "the organization of clinical trials" which are deemed to be supplied in the place where the supplier of the service is established . Consequently, in cases in which a local CRO supplies services to foreign entities, and uses the services of local healthcare institutions for this purpose, the local CRO is required to pay VAT on such service. Relying on the Ministry's opinion, the Serbian Tax Administration conducted several VAT audits on some of the largest CROs in Serbia and ordered them to pay significant amounts of VAT.
Following an exchange of written opinions with the Serbian Ministry of Health, on 23 April 2015, the Ministry of Finance changed its initial position and amended its opinion to provide that CROs, and not only healthcare institutions, may provide clinical trial services which qualify for the VAT exemption. The Tax Administration has not yet made a final confirmation of this new position in pending disputes. However, hopefully, this is the final opinion regarding this matter, and there will be no more disturbances in practice.