Only nine out of 25 municipalities have established local spatial planning companies, of which only two are operational, although the legal deadline for their establishment expired in May 2025. Many municipalities are still drafting founding acts for these companies, some are considering joint establishment with other municipalities, while others have no solution in place. The rapid reform of the system has confronted local governments with a shortage of qualified professional staff.
As early as the first year of implementation of the Spatial Planning Act, adopted in February 2025, numerous challenges in putting the initial foundations for the decentralisation of spatial planning into practice became apparent, according to research conducted by Institute Alternative (IA). The new Act reintroduces local planning documents, formally returning part of spatial planning competences to municipalities. Under the Act, state planning documents are to be prepared by a company established by the Government, namely the Spatial Planning Agency of Montenegro, while local planning documents are to be prepared by companies established by municipal assemblies. The Act also allows for local planning documents to be prepared by companies jointly established by two or more municipalities.
Local governments were required to establish spatial planning companies within 60 days (by early May 2025). However, this obligation has so far been formally fulfilled only by the Capital City, the Royal Capital, and seven additional municipalities. An equal number of municipalities still do not have even the founding acts in place, while some local governments plan to delegate planning tasks to companies established in larger municipalities.
“Namely, it was assessed that the preparation of planning documents regulating space as the most important and valuable resource should fall exclusively under the competence of the state or local self-government. The Act clearly defines the competences of the company responsible for preparing planning documents, while the review of local planning documents falls within the remit of the state Agency,” representatives of the Ministry of Spatial Planning, Urbanism and State Property told Institute Alternative.
Under the law, the Spatial Planning Agency of Montenegro must employ a responsible planner and at least eight planners. Local planning companies are required to employ a responsible planner and at least four planners. According to the Act, a responsible planner may be a spatial planner or architect with at least a VII-1 level of qualifications and a minimum of 10 years of professional experience in spatial or urban planning, or, exceptionally, a person with a Level VIII qualification and at least seven years of experience in these fields. Planners must hold at least a VII-1 qualification level and have a minimum of five years of professional experience in spatial or urban planning.
It is precisely these requirements that represent the main reason for delays in establishing local planning companies, representatives of most municipalities told IA.
Decisions on the establishment of local spatial planning companies have so far been adopted in only nine local governments – Podgorica, Nikšić, Bar, Bijelo Polje, Budva, Ulcinj, Cetinje and Kolašin. However, only the companies in Herceg Novi and Nikšić are operational.
Many municipalities—particularly smaller and northern ones—are either still drafting founding documents or seeking models for joint establishment of companies with neighbouring municipalities. In some local governments, authorities state that no solution has yet been identified.
Although the decentralisation of spatial planning is recognised by municipalities as a key step toward strengthening local autonomy, the process of establishing new companies to implement it faces serious challenges. The main problem lies in the pronounced shortage of qualified professional staff, particularly licensed planners and architects who meet the strict legal requirements regarding qualifications and work experience. Many municipalities assess that the reform was launched too quickly, without prior provision of adequate methodological support, technical capacity, and stable financial instruments, leaving them unprepared to implement it effectively.
Podgorica – Agency in the Organisational Set-Up Phase
In September of last year, the Assembly of the Capital City established the Agency for the Preparation of Local Planning Documents. In November, the Board of Directors was appointed, and at the very end of the year, the Statute was adopted.
Podgorica opted for a stand-alone urban planning agency model, considering it the most appropriate for its specific needs as a large and dynamic urban environment, given the complexity of planning tasks and investment activities. However, the city authorities emphasise that Podgorica remains open to cooperation with all municipalities.
“The most important step in the coming period will be the formation of a professional team of planners and supporting profiles, as the quality of planning in Podgorica largely depends on the Agency’s human resources capacity. The Agency’s staffing structure will be precisely defined in the systematisation act, which will be drafted after the adoption of the Statute. Only then will it be possible to launch recruitment procedures for the responsible planner and the planning team,” representatives of the Capital City stated.
Royal Capital: Company Established but Not Yet Operational
The Assembly of the Royal Capital adopted the Decision on the Establishment of the LLC ‘Agency for Spatial Planning and Design’ in October 2025. According to local authorities, the next steps include registration and obtaining the necessary operating licences, followed by the appointment of management bodies, adoption of the Statute and other legal acts, and recruitment.
“The newly established company has not yet commenced operations; we are currently in the preparatory phase to put this company into function. A major challenge is the shortage of professional staff, particularly responsible planners, at the national level,” representatives of the Royal Capital stated.
They also note that it is already clear that, in order to incentivise qualified professionals to take up employment in the Royal Capital, it will be necessary to introduce additional incentive measures.
Nikšić – Agency to Provide Services for the Municipalities of Plužine and Žabljak
In line with the law, the Municipality of Nikšić restructured the existing Agency for Planning and Design into a company of the same name, in accordance with the new legislation. The Statute has recently been adopted, the Management Board appointed, and the Executive Director named. The previous Agency, municipal officials recall, was engaged in planning activities until the amendment of the overarching law in 2017. Since then, due to legal restrictions, it had focused on projects in the fields of transport, hydrotechnics, and building reconstruction.
According to Executive Director Ana Vukotić, the new Agency is active and fully operational, and it is planned that it will also provide spatial planning services for the municipalities of Plužine and Žabljak. She expects this cooperation to be formalised through contracts in the near future.
“The company has fulfilled all legal requirements in terms of human resources capacity. The existing team consists of planners, architects, civil and mechanical engineers, and landscape architects,” she stated.
In Vukotić’s view, taking into account the challenges faced by smaller municipalities, the decentralisation of spatial planning is assessed as necessary; however, the deadlines for implementing the law were too short and insufficiently flexible.
From the office of the Mayor of Žabljak, Radoš Žugić, it is expected that a contract with the Nikšić Agency will be concluded soon, and funds for its operation have already been allocated in the 2026 municipal budget.
“This is currently the only model that the Municipality of Žabljak can implement, given that this is a highly demanding task and that even larger municipalities face difficulties in establishing such an agency,” the Mayor of Žabljak stated.
Joint Company for Herceg Novi, Kotor and Tivat; Independent Agencies in Bar, Budva and Ulcinj
Since 2016, Herceg Novi has had the LLC “Agency for Construction and Development”, which functioned as a specialised public service responsible for comprehensive urban development tasks. Its activities included construction, financial intermediation, real estate and land management, construction of local roads, and the implementation of investments of public interest. In July of last year, the Municipal Assembly adopted amendments to the founding decision of this company, aligning it with the new Spatial Planning Act. Cooperation with the municipalities of Kotor and Tivat was formalised through a Memorandum of Cooperation on the preparation and drafting of local planning documents, signed on 10 December.
Regarding staffing, municipal officials claim that they have met “more than the legally prescribed minimum” — the Agency employs four responsible planners and one planner, and currently has 22 staff members in total.
“Only the actual drafting process will show whether the existing capacities are sufficient to meet the dynamics of preparing planning documentation for all three coastal municipalities, or whether additional expert staff will need to be engaged,” officials from the Municipality of Herceg Novi concluded.
The Municipality of Tivat explains this cooperation by noting that the three municipalities share the same specific bay-related natural and geographical environment, possess common and interconnected communal infrastructure, and are subject to certain levels of UNESCO protection. Staffing shortages are also cited as a key factor.
“The Municipality of Tivat, and we believe other local governments as well, face major difficulties in recruiting professional and qualified staff who hold the required licences. The salaries offered by municipalities are not competitive compared to other companies on the labour market. This applies to lawyers, engineers of various profiles, economists, and similar professions,” representatives of the local government stated.
The Municipal Assembly of Budva adopted the Decision on the Establishment of the LLC ‘Agency for Planning, Design and Development of the Municipality of Budva’ in early September last year. The company is currently in the phase of ‘ensuring operational functionality’, and the draft 2026 budget allocates €100,000 for its operation.
The Municipal Assembly of Ulcinj transformed the Agency for Construction and Development into a company that will carry out tasks prescribed by the new law. According to Škeljzen Sulejmani, Secretary for Spatial Planning and Sustainable Development, management bodies have been established, but the adoption of the systematisation act is still pending, followed by the publication of public calls to recruit staff. He warns of staffing shortages affecting most municipalities, noting that Ulcinj is no exception.
The Municipal Assembly of Bar adopted the Decision on the Establishment of the LLC ‘Institute for Spatial Planning’ in early June. However, this company has not yet commenced operations, as management bodies have not been formed and professional staff required to perform its core functions have not been recruited.
“Material and technical conditions for operation have also not yet been secured, although the founder is working to address these issues, while the recruitment of qualified professional staff remains partly problematic,” said Ognjen Leković, Acting Secretary of the Secretariat for Urbanism and Spatial Planning.
Kolašin and Bijelo Polje Established Agencies; Berane Plans a Joint Company with Mojkovac and Andrijevica
Kolašin was among the first municipalities to establish a local company for spatial planning and design. Management bodies have been appointed, an acting executive director has been named, and the systematisation act has been adopted. However, the company is not yet operational, and Acting Director Andrija Mirović says that the process of recruiting appropriate staff is ongoing.
The Municipal Assembly of Bijelo Polje established the LLC “Spatial Planning Agency” in June, subsequently appointing the Board of Directors, and adopted the Statute of the company in October. The appointment of the executive director is expected in the coming period. Bijelo Polje opted for a local company model; however, according to Chief Administrator Ernedin Ćeranić, if they are unable to secure the required staff, they will negotiate cooperation with neighbouring municipalities.
“We believe that Montenegro is not ready for such a rapid implementation of the law, in this specific case due to the lack of qualified staff. Therefore, we consider it necessary to ease the legal requirements regarding professional qualifications and work experience,” Ćeranić assessed.
The Municipality of Berane has initiated activities aimed at establishing a model for the preparation of planning documents in line with the law, said Mayor Đole Lutovac. The 60-day deadline for establishing a company, he explained, could not be met “due to financial constraints, a lack of qualified staff on the labour market, and the need to align a model that is sustainable for the municipality in the long term.”
“The Municipality of Berane has opted for a joint company model, taking into account economic rationality, workload, and the challenges faced by small and medium-sized municipalities. Activities are underway to establish a joint company with the municipalities of Mojkovac and Andrijevica. This model was chosen to ensure more stable human resource and financial capacities, as well as continuity in the preparation of planning documents,” Lutovac stated.
Pljevlja, Rožaje, Plav, Šavnik, Petnjica, Gusinje, Danilovgrad, Tuzi and Zeta Still Lack Even Founding Acts
As many as nine municipalities in Montenegro have not yet adopted decisions on establishing local companies for spatial planning and design. Some of them are considering joint-company models, but no concrete agreements have been reached so far. In all cases, the primary reason for delays is the lack of qualified staff.
The Municipality of Plav states that in the previous period it considered and analysed the possibility of establishing a local company, as prescribed by the law. “The dominant reason why the process has not been finalised is the lack of professional, licensed planning staff. Without secured planners, establishing a company would be purely formal, without any real possibility of taking over the prescribed tasks. For this reason, we are proceeding cautiously, because establishing a company without operational capacity would produce no results,” said Nihad Canović, Mayor of Plav.
At this moment, he adds, “neither an independent nor a joint model is fully sustainable for smaller municipalities, precisely due to staff shortages.” Although, conceptually, the return of spatial planning competences to municipalities is positive, the implementation model remains questionable. In Canović’s view, the reform was launched “too quickly, without prior provision of professional staff, standardised support, and financial instruments.”
For the same reasons, procedures for establishing a company have not yet been initiated in the Municipality of Šavnik. According to Mayor Jugoslav Jakić, the local government is considering a “third model,” as they are not convinced that cooperation with larger municipalities would be suitable.
“If we join forces with a larger municipality, it is quite likely that we would be forced to wait until the joint company completes that municipality’s planning tasks. We do not have the potential to establish an independent company, so we are in the process of seeking a ‘third solution’,” he said.
The Municipality of Gusinje explains that it is hesitant to establish a company because it is clear that it will not be able to attract qualified staff. A long-standing issue for the municipality is even the recruitment of a construction inspector. Only preliminary discussions have been held regarding a potential joint company with Plav or Rožaje.
The Municipality of Rožaje also lacks staff capacity, but has prepared a draft decision on the establishment of a company. The municipality has requested an opinion from the Union of Municipalities of Montenegro and is considering a joint company with neighbouring municipalities.
The same reasons are cited by the Municipality of Zeta. “We do not have the capacity to establish an independent company, neither in terms of staffing nor organisation. We also consider that the joint-company model is not optimal for smaller municipalities and that the current legal framework is unsustainable. As a more realistic and economically viable solution, we propose the establishment of regional agencies that would pool the human and technical resources of several municipalities, instead of requiring each municipality individually to secure a large number of planners and a complete organisational structure,” municipal representatives stated.
In the Municipality of Tuzi, however, authorities believe that the joint-company model is more sustainable for smaller municipalities, noting that they are effectively forced into such a model due to a lack of capacity for an independent company.
“We assess the decentralisation of spatial planning as an important step toward greater municipal autonomy and more efficient spatial management. However, successful implementation depends on securing adequate human and financial resources, which represents a key challenge at this stage. Given the current situation, and considering the fact that local governments are already late in establishing companies for the preparation of planning documentation, it is evident that municipalities were not prepared for such a rapid implementation of the law,” representatives of the Secretariat for Urbanism stated.
The Municipality of Petnjica assesses that formally establishing a company without conditions for its functioning would be irresponsible, which is why it has not initiated the process of establishing a local company for the preparation of planning documents.
“We will certainly not establish an independent company, because at this moment there are no human or financial conditions to make such a model sustainable,” representatives of the municipality concluded.
Union of Municipalities of Montenegro: Sustainability of Municipal Planning Companies Depends on Flexibility and Support
The model of establishing companies for the preparation of planning documents represents an important mechanism for strengthening the capacities of local governments and improving the quality of spatial planning, according to the Union of Municipalities of Montenegro (UOM), which recalls that this is one of the recommendations of the Council of Europe. However, they explain that this reform “requires significant institutional and organisational adjustments.”
The dynamics of the implementation of the law, they note, have highlighted the need for gradual capacity-building of local governments, particularly in terms of human resources, methodological support, and technical equipment, in order to fully achieve the objectives of decentralisation.
“For the successful completion of the process in all municipalities of Montenegro, it is necessary to provide additional financial support for the establishment and initial operation of companies, support for strengthening human resource capacities through training, professional development, and the recruitment of licensed planners, clear methodological guidelines and operational instructions from the competent Ministry, as well as support for inter-municipal cooperation models, especially for smaller municipalities. Furthermore, a stimulative wage policy that is competitive with the private sector is needed to enable the recruitment of scarce spatial planning professionals,” the Union of Municipalities of Montenegro recommends.
Author: Dragana Šćepanović
The research article was conducted as part of the project Civic Engagement for Better Local Governance, implemented by Institute Alternative with financial support from the European Union and co-financing from the Ministry of Regional–Investment Development and Cooperation with Non-Governmental Organisations. The views expressed in this research article do not necessarily reflect those of the donors.