Our website uses  cookies for statistical purposes.

Our Articles

Company Act in Croatia

Company Act in Croatia

The Croatian Company Act is known for its flexibility in terms of setting up a company in Croatia. It mainly comes from the German and Austrian legislation. The Company Act was adopted in November 1993 and it regulates all types of companies in Croatia. It contains all the requirements for opening a company in Croatia, as well as all rules for running a company in this country. For a better understanding of how companies can be registered in Croatia and what the rules are in this direction, we recommend you talk to one of our company formation agents in Croatia.

What types of companies can I register in Croatia?

The Company Act in Croatia stipulates the rules for the following types of companies that can be registered by investors in this country:

  • private limited company (the shares of the company are not traded publicly);
  • limited liability company (it can be established with a minimum share capital of EUR 2,500);
  • public limited company (the shares can be traded publicly);
  • joint stock corporation (available for large companies from abroad);
  • general partnership (the owner/managing partner has unlimited liability)
  • limited partnership (the limited partner has limited liabilities);
  • silent partnership (the silent partner provides capital for the company or business).

Here is an infographic with extra details about the Company Act in Croatia

The main provisions of Company Act in Croatia (1).png

New rules regarding share capital in euros for companies in Croatia

Croatia adopted the euro starting from January 2023. Many sets of laws have been updated in this regard, among them, is the Company Law in Croatia. Thus, the minimum share capital that was mentioned in Croatian Kuna must be found in the company’s documents in Euro currency, taking into account the conversion. This amendment is brought to the Company Act in Croatia as an obligation for companies registered in this country, considering the transition to the new currency. We recommend those interested in company incorporation in Croatia talk with our local agents and find out what interests them about the formalities.

What is the most popular business structure in Croatia?

The limited liability company in Croatia is the preferred type of business in this country, mostly for the easy way of the structure and also the incorporation. Our company incorporation consultants in Croatia can help local and foreign investors set up an LLC in Croatia or OOD (Drustvo s Ogranicenom Odgovornoscu) as it is known.

How can I open a DOO in Croatia?

Foreign entrepreneurs can easily register a DOO in Croatia, with a minimum share capital of EUR 2,500, a legal representative, and one manager appointed by the shareholders of the company, and after a name verification with the Croatian Trade Register, which needs to contain the letters DOO at the end of it. All the paperwork and the requirements of DOO registration in Croatia can be handled by our team of consultants at any time.

Can I open a branch in Croatia?

Yes, foreign companies can establish branches in Croatia and can commence operations from abroad, under the rules of a limited liability company. Branches in Croatia are mostly met in the banking system but are not limited to this.

How do I open a subsidiary in Croatia?

Subsidiaries in Croatia are independent legal entities that can have other activities besides the ones of the parent company. The public or private limited liability companies are proper and recommended business forms through which a subsidiary in Croatia can be established. For a minimum share capital of EUR 25,000, a public limited liability can be registered, in order to start the activities as a subsidiary. A supervisory board and a management board need to be appointed at the time the subsidiary is formed.

The registration of a subsidiary is done with the Croatian Trade Register and the Articles of Association are the main documents that need to be submitted to this authority. We mention that one of our company formation agents in Croatia can provide in-depth support and assistance for opening a subsidiary in this country, as they can handle the entire process and the formalities involved. Foreign investors interested in establishing a subsidiary in Croatia must know and understand the applicable laws for business in this country. Our team can offer support and also guidance for VAT registration.

Shelf companies in Croatia

According to the Company Act, local and foreign entrepreneurs can purchase vintage companies or ready-made companies. These are incorporated companies, kept on a shelf and ready to be bought by persons who would rather skip the formation process of a company in Croatia. Shelf companies do not have activities, and therefore no financial activities, no liabilities, or debts. Such companies present confidence to banks and other financial institutions that can easily provide loans and credits for future business operations.

Ready-made companies in Croatia can be purchased by any domestic or foreign entrepreneur who is interested in having a business in CroatiaShelf companies present numerous advantages among which, fast implementation on the market, no liabilities, an opened bank account, easy transfer of ownership rights, and trustworthiness among future clients and collaborators. It is good to know that once the ownership transfer is made, the entrepreneur has the business on his/her hands and can rapidly start the activities. You are invited to talk to one of our company formation representatives in Croatia and find out more about how to purchase a ready-made company in this country.

Sole proprietorship in Croatia

Investors from overseas can perform their operations as sole traders in Croatia and can benefit from the same simplified business registration in this country, in respect to the Company Act. Also, such business owners need to observe the rules and regulations of the Handicraft Act in Croatia and must incorporate them as sole proprietorships with the Register of Craftsmen in Croatia.

What’s new about the Croatian Company Act?

Since May 2019, there have been some particular changes made to the Croatian Company Act, mostly related to the registration of limited liability companies, with respect to the EU legislation. The modifications have been brought to simplify the process and to increase competitiveness. Here are the main important changes to the Company Act in Croatia:

  1.  The registration of a company in Croatia can be made entirely online. You can talk to our company formation agents in Croatia for complete support.
  2. New companies can be registered in a short period.
  3. There is no need to reserve a company name before the establishment.
  4. The business activities do not need to be mentioned by the Articles of Association.
  5. The authorities will no longer solicit to deposit signatures of authorized persons, with the court register.
  6. The cessation of LLCs in Croatia is now possible in a fast manner.

According to the new provisions of the Company Act in Croatia, limited liability companies, joint stock companies, and other available structures must register share capital changes within a certain period. If this obligation is not respected, it is considered that there are reasons for the company to be terminated.
On the other hand, the lowest share capital for forming a joint stock company in Croatia remains EUR 25,000 with EUR 1 as the nominal amount of one share. And here is the problem of conversion from Croatian Kuna to Euro, according to the new regulations on the matter. Moreover, those who own limited liability companies in Croatia have until January 1, 2026, to make the currency exchange to their share capital.

We can tell you more about Company Law in Croatia, so you can talk to our specialists at any time.

The simple limited liability company in Croatia

The limited liability company is the simplest business structure in Croatia that can now be registered by 5 founders instead of 3 until recently. One director or manager must be appointed, regardless of nationality. Moreover, there is no need to reserve the business name before the registration of the company in Croatia, as this is a new modification mentioned by the Croatian Company Act.

Franchise in Croatia

The franchising system in Croatia is permitted, as stated by the Croatian Company Act if all the conditions and requirements are fully understood and respected. Entrepreneurs can establish a branch of a foreign franchise or open a local one. The marketing strategies, the business plan, pricing, and location are detailed between the franchisee and the franchisor, with the mention that a franchise agreement must be signed. The rights of using the license in the case of a franchise can be explained by one of our specialists who can help foreigners register a franchise in Croatia.

Liaison offices in Croatia

Liaison offices make the connection between the parent company and the potential collaborators and clients in the country chosen for further business operations. Advertising, marketing, promotional activities plus market research are among the activities of a liaison office in Croatia. Having only these kinds of operations means that the liaison office cannot develop financial operations and therefore, no generated income. The registration of a representative office in Croatia starts with an application form, a copy of the certificate of incorporation of the company (issued by the competent authorities in the home country), plus a brief description of the future operations of the liaison office in Croatia.

What does the legislation say about company mergers in Croatia?

According to the Company Act in Croatia, public limited liability companies can set up new public LLCs through fusion or merger. In this case, merging companies are terminated, being called the process of absorption of one company within another, the first being able to cease its activities. The process also involves the transfer of assets, a general assembly for decisions in the new company, the preparation of new documents and contracts, etc. Business owners interested in mergers and acquisitions in Croatia and the new provisions of the Company Act can choose the services offered by our local agents. We can offer specialized assistance to prevent possible problems or complexities related to business direction.

Making investments in Croatia

Croatia benefits from very appreciated economic stability, a good geographic location, and complete support provided by the authorities to international investors. The highly skilled and multilingual workforce, appealing tax incentives and legislative amendments to sustain foreign direct investments in Croatia. Engineering, textile, tourism, ICT, food industry, agriculture and medicine, and pharmaceutical fields are among the business choices for international entrepreneurs in Croatia. The low labor and administrative costs are attentively measured by investors wanting to cut the expenses of a business in Croatia. Below you can find interesting information, facts, and data about investments and the economy in Croatia:

  1. According to the latest data, Croatia registered an economic growth of approximately 2.8% in 2023.
  2. According to estimates, a GDP growth of around 3.3% should be registered in 2024 and 2.9% in 2025.
  3. It is expected that in 2024 and 2025, household consumption will support the economic growth of Croatia.

The Croatian Company Act stipulates all the business rules and regulations a foreign or local entrepreneur needs to know before opening a company in Croatia.

Besides assistance in company formation, you can also benefit from the services offered by our accountants in Croatia. Payroll in Croatia is important for any company. For more details about the Company Act, you may contact our specialists in company formation in Croatia.