A foreign investor, under the condition of presumed reciprocity, founders or participates in the founding of companies in the Republic of Croatia, acquires rights and assumes obligations in them under the same conditions and has the same position as a domestic person. The condition of reciprocity does not apply to a foreign investor who has its registered head office or permanent residence in a member country of the World Trade Organization, or is a citizen of it. A foreign capital company, which has its seat in a country which is not a member of the European Union, nor is a party to the Agreement on the European Economic Area, may be members that the obligations of society is personally responsible in the company of people with registered office in the Republic of Croatia only if it is with him in the company at least one other member of a capital company having its registered office in the Republic of Croatia, a Member State of the European Union or a State party to the Treaty on the European Economic Area or a natural person who is a citizen of the Republic of Croatia, a Member State of the European Union or a State Party the European Economic Area, which is personally responsible for these obligations.
Foreign companies and individual traders, under the conditions prescribed by law, are equal with domestic persons in terms of business in the territory of the Republic of Croatia. However, foreign companies and foreign individual traders may not permanently perform activities in the territory of the Republic of Croatia until they found a branch office. Performing an activity is not considered, for example, occasional or one-off activities, i.e., carrying out a particular job (the notion of freedom to provide services in accordance with the acquis).
Foreign investors may acquire ownership and shares in joint stock companies. The minimum amount of share capital for founding a joint stock company is EUR 25,000.00 where the nominal value per share may not be less than EUR 1.00. The minimum share capital for founding a limited liability company is EUR 2,500.00, where the nominal amount of a business share may not be less than EUR 10.00. Before registering a company in the court register, every founder must pay at least one quarter of share capital in cash, where the total amount of all payments in cash may not be less than one quarter of the share capital.
The company with a maximum of five members and one member of the management board may be founded in a simplified manner as a simple limited liability company. The minimum amount of share capital of such a company is EUR 1.00, and the lowest nominal amount of the business share cannot be less than EUR 1.00. To found this type of company, incorporation must be in the form of minutes drawn up by a notary public, which such minutes become annexes to the Articles of Association.
HITRO.hr is a service founded by the Government of the Republic of Croatia, to speed up communication between entrepreneurs and state administration, and through which it is possible to found a limited liability company or a simple limited liability company.
Steps to sound a Company:
1. Company name availability check
An entrepreneur must first choose a name for a company. When checking the name for the company, one can use the Court Registry website. The staff of HITRO.HR service can help check the register to find out whether a company by the chosen or similar name already exists.
Company name must be clearly distinguished from the other names registered in the Court Registry, the identity or association with another company that violates the rights of intellectual and industrial property rights or rights of other people. The word “Croatia” and its derivatives may be entered in the company name only with the consent of the State authorities. Company name cannot contain names, logos, flags or other national emblems of other countries or international (intergovernmental) organizations, nor official signs for control and quality guarantee. Company name can hold a part of the names of a person only with her consent, and if that person died, with the consent of heirs. Company name must be in Croatian language and Latin script or the official language of the EU Member State and Latin script and may use Arabic numerals. Company name can be translated into one or more languages and as such appear in the incorporation documents.
Other company components must be in the Croatian language and Latin script.
2. Public notary
Documents necessary for company registration must be notarized by the Public Notary. All founders and other persons whose signatures are to be notarized must be present. For foreign nationals who do not speak Croatian, there must be a court interpreter for the language present. After notarization, the Public Notary forwards the documentation electronically to the HITRO.HR office.
3. Payment of fees and submission of documents
Registration documentation notarized by the Public Notary can be submitted to HITRO.HR.
An entrepreneur can make the payment of court fees and the initial capital at HITRO.HR. After the payments have been made, HITRO.HR will complete the application and forward it to the competent Commercial Court electronically or submit paper documentation if the conditions for electronic submission are not met. If the documentation that was sent electronically is correct and complete, the Commercial Court will register the company in the Court Register within 24 hours and electronically deliver to the HITRO.HR office the Decision on Incorporation and Certificate of Croatian Personal Identification Number (OIB) of the newly founded company. In the case when the documentation is submitted to the Commercial Court in paper form, the deadline for entering the company in the Court Register is 5 days, and the Decision on Incorporation of the Company and the Certificate of OIB are collected by the HITRO.HR office in paper form at the Commercial Court.
At the HITRO.HR office, an entrepreneur can obtain and fill out the RPS form, which is required to obtain a Notice on the classification of a business entity according to the National Classification of Activities of the National Bureau of Statistics (assignment of registration number and main activity code). HITRO.HR will automatically receive the Notification from the Central Bureau of Statistics electronically, within one working day, after receiving the Decision on Incorporation.
4. Company’s opening of an account
The Decision on Incorporation and the Notification on the classification of a business entity according to the National Classification of Activities with the entered registration number can be obtained from the HITRO.HR office.
Bank account opening can be arranged at the HITRO.HR office (in those banks for which FINA performs account opening operations or mediates in the performance of these operations).
The company, the owner of the company and the employees of the company must be registered in the pension insurance system (HZMO – e-Mirovinsko). In addition to registering the company in the pension insurance system, it is also necessary to register it in the health insurance system (HZZO – e-Health). The company must also be registered with the competent Tax Administration.
This service enables an entrepreneur to found a company – a limited liability company (d.o.o.) or a simple limited liability company (j.d.o.o.) – by using an electronic ID and without visiting the competent registration body in person. Besides a qualified electronic signature, an entrepreneur will need only an active e-mail address and a bank card that can be used for paying the stake in the company’s share capital.
If an entrepreneur does not have a Croatian electronic ID but is a national of a European Economic Area (EEA) member state, an entrepreneur can use the credentials from his/hers national electronic ID for identification and sign the documents using his/hers qualified electronic signature issued by an EU trust service provider from the following list.
Each founder of a company must have a Croatian Personal Identification Number (OIB) issued by the Ministry of Finance, Tax Administration. If an entrepreneur does not have a Croatian OIB but is a national of an EEA member state, he/she will be redirected to the Tax Administration website to apply for an OIB. Once an entrepreneur has received an OIB, he/she can proceed with the founding of a company.
The Ministry of the Economy and Sustainable Development has launched the START system enabling users to electronically start up a business, i.e., found a limited liability company (Ltd.) and a simple limited liability company (simple Ltd.) with one or more domestic founders and also sole proprietorships. The new system allows entrepreneurs to launch a business in just a few days, at significantly lower costs.
Currently, the following services are provided in the start system:
– Registration of the company in the court register,
– Registration of sole-owner business in the sole proprietorship register,
– Registration in the register of business entities (Central Bureau of Statistics),
– Registration in the register of taxpayers, VAT register and/or assignment of a VAT ID number (Tax Administration),
– Request to open transaction accounts for business entities (banks),
– Registration in the Croatian Pension Insurance Institute (HZMO) system,
– Electronic payment of fees and share capital.
The system will be continuously upgraded and developed, and in the second phase, the possibility of founding a company and a sole proprietorship with one or more foreign founders is envisaged.