Country Trading Profiles Croatia

Setting up a company | FDI in figures | Why you should choose to invest | Procedures relative to foreign investment | Finding assistance for further information

Setting up a company

Types of companies and capital (max/min)	Number of partners/shareholders and liability
Private Limited company Minimum HRK 20,000, totally released	No minimum. Liability is limited to the amount contributed
Public Corporation Minimum HRK 200,000	No minimum. Liability is limited to the amount contributed
General partnership No minimum capital	Minimum 2 Every partner has unlimited liability with all his/her assets.
Limited partnership No minimum capital	Minimum 2: one general partner and one limited partner At least one partner (general partner) has unlimited liability with all his/her assets and at least one (other) partner has limited liability proportional to the invested assets.

Business setup procedures

Setting up a company	Croatia	Eastern Europe & Central Asia
Procedures (number)	6.0	6.3
Time (days)	7.0	16.3

Source: Doing Business.

For further information: Consult Doing Business Website, to know about procedures to start a Business in Croatia.
Register of Business Entities
The competent organization: Court Register

FDI in figures

Foreign Direct Investment	2008	2009	2010
FDI inward flow (millions USD)	6,140	2,911	583
FDI stock (millions USD)	31,768.8	35,954.6	34,373.9
Performance Index*, ranking on 141 economies	28	43	-
Potential Index**, ranking on 141 economies	55	-	-
Number of Greenfield investments***	40	28	-
FDI inwards (in % of GFCF****)	32.1	32.1	-
FDI stock (in % of GDP)	45.8	58.1	-

Source:

Note: * The UNCTAD Inward FDI Performance index is based on a ratio of the country's share in global FDI inflows and its share in global GDP. ** The UNCTAD Inward FDI Potential index is based on 12 economic and structural variables such as GDP, foreign trade, FDI, infrastructures, energy use, R&D, education, country risk. *** Green field investments are a form of foreign direct investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up. **** Gross fixed capital formation (GFCF) measures the value of additions to fixed assets purchased by business, government and households less disposals of fixed assets sold off or scrapped.

Why you should choose to invest Croatia

Strong points

Croatia has a number of strong points:
- An advantageous geographical location along the Adriatic Sea;
- A skilled multilingual workforce;
- Good quality infrastructures: Croatia continues to invest heavily in transportation, telecommunications and energy infrastructures; and
- An entry gateway to the EU: Croatia could become a member in 2013.

Weak points

Croatia still has to face a number of challenges in order to become competitive:
- the country suffers from certain structural weaknesses amongst which are the current account imbalance, a significant private foreign debt and a trade deficit;
- the country also has an image problem. It is more known for tourism than as and investment opportunity. Croatia is also suffering from a backlash of years of war; and
- the legal and administrative systems are slow and could use some improvement.

Government measures to motivate or restrict FDI

Croatia is open to foreign investment. The government has committed itself to increasing foreign investment and has taken measures to improve the investment climate in the country, for example, depending on the type of activity (manufacturing, technology centers, supporting services), through tax reductions and employment incentives. Amongst the main measures established by the government, we can name in particular:
- Equal treatment of nationals and foreigners;
- Low company admninistrative fees; and
- Laws protecting intellectual property.

All measures are established to create an attractive framework for investors and to make Croatia a valid foreign investment recipient.

For more details on FDI's incentives, refer to the Agency for the promotion of trade and foreign investment and to the Croatian Chamber of Economy website.

Procedures relative to foreign investment

Acquisition of holdings: A foreign investor can hold 100% interest in the shares of a Croatian company, except in some cases specified by the government.
Obligation to declare: Only for the acquisition of public joint stock companies.
Competent organization for the declaration: Croatian Financial Services Supervisory Agency

Finding assistance for further information

Investment aid agency: Trade and Investment Promotion Office
Other useful resources: Investment Promotion Directorate at the Ministry of Economy
Croatian Economic Diplomacy portal

COUNTRY TRADING PROFILES