Montenegro’s effort to modernise its tax and business administration through the introduction of a new digital platform has instead triggered a prolonged operational breakdown, leaving company registration effectively paralysed and inflicting growing damage on both the state budget and the business community. More than a month after the launch of the Integrated Revenue Management System (IRMS), the core functionality required to register new companies and process changes to existing corporate records remains non-operational.
The system was introduced as a flagship digital reform aimed at consolidating tax administration, improving compliance, and accelerating interactions between businesses and the public sector. In practice, however, the malfunction of the registration module has created a bottleneck that prevents newly established firms from obtaining formal confirmation of their legal status. Without such confirmation, companies are unable to open bank accounts, enter into contracts, access financing, or participate in public procurement procedures.
This operational freeze has immediate fiscal consequences. Each day of delayed company registration translates into lost tax revenues, postponed employment, and deferred investment. For a small economy where new business formation plays a disproportionate role in driving growth and innovation, the cumulative impact is becoming increasingly visible. Entrepreneurs report stalled projects, sunk preparatory costs, and rising uncertainty, while professional service providers face workflow disruptions that ripple across the broader economy.
The situation has been compounded by legal and procedural ambiguities surrounding electronic notarisation. Members of the Notaries Chamber of Montenegro have declined to fully engage with the new system, citing unresolved inconsistencies between the digital platform and existing legal requirements. This has effectively removed a critical link in the business registration chain, further entrenching the blockade.
What distinguishes the current disruption from typical start-up issues associated with large IT systems is the absence of a functional fallback mechanism. The transition to IRMS was implemented without maintaining parallel legacy procedures, leaving applicants with no alternative pathway to complete registrations. As a result, administrative efficiency has not merely declined but has, in practical terms, ground to a halt in this segment of economic life.
From an investor and policy standpoint, the episode raises broader questions about institutional readiness and reform sequencing. Digitalisation of public administration is widely recognised as essential for competitiveness and transparency, yet the IRMS rollout illustrates the risks of deploying complex systems without sufficient testing, transitional safeguards, and stakeholder coordination. The reputational cost of such failures can be significant, particularly at a time when Montenegro is positioning itself as an increasingly attractive destination for regional and EU-oriented investment.
Business associations and legal experts are now calling for urgent corrective measures, including temporary procedural fixes and clearer communication on timelines for full system functionality. Until registration processes are restored, the blockage represents not just a technical malfunction but a structural constraint on economic activity, undermining confidence at a critical juncture for Montenegro’s growth and reform agenda.
