Following the 1878 Congress of Berlin, the Habsburg Empire occupied Bosnia and created the Austro-Hungarian Condominium of Bosnia and Herzegovina, which prompted a confrontation between the Serb and Croat national ideologies, and the new "Serb-Catholic" circle of Dubrovnik increasingly broke with the pan-Slavic tradition of its founders, Pucić and Ban.
In 1908 all Serbian unions, clubs and newspapers in the city were closed and forbidden by Austrian authorities, which led to massive emigration of Serbian-oriented high society from the city of Dubrovnik.