Legal market overview
After six years of recession which eroded some 13% off the country’s output, Croatia experienced 1% growth in 2015. However, although foreign investment has picked up slightly, this may be viewed as a corollary of the country’s accession to the EU and the general marginal uplift of its economic mood. Zoran Milanović’s centre-left government has continued on a path of fiscal consolidation which was the hallmark of the previous government but high bureaucratic costs, uncompetitive highly leveraged companies and general uncertainty before impending elections resulted in a general unwillingness among foreign investors to invest in the country.
Therefore, on the corporate front – with the exception of one or two very large cross-border M&A deals (most notably, British American Tobacco’s acquisition of Adris Group’s retail and tobacco business) – law firms in the region have had to make do with relatively small mandates. Similarly, privatisation processes have come to a standstill, with the flag carrier Croatia Airways, railway cargo firm HZ and the last major state bank still awaiting buyers. One area of activity, however, has been in relation to debt recovery and many of the country’s major law firms have been involved in some manner for Austrian bank Hypo Alpe-Adria-Bank in relation to its winding down. This has largely taken the guise of acting for its wind-down company Heta Asset Resolution in its efforts to dispose of non-performing assets.
Several traditional heavyweight full-service law firms remain prominent across the majority of practice areas and these include Divjak, Topic & Bahtijarevic; Mamic Peric Reberski Rimac Law Firm LLC; Porobija & Porobija; Šavoric & Partners; and Žuric i Partneri. However, a number of effective younger challengers are emerging, many of which were set up by former senior associates or partners at these leading firms. Of these, since its foundation in September 2014, Kovacevic Prpic Simeunovic has made significant inroads in banking and finance, as well as corporate and M&A work. Other notable younger firms include Law Office Lacmanovic, which has handled a considerable quantity of work for Heta Asset Resolution; Law Office Krehic, Stanicic & Gricar, which has made significant inroads in the telecoms and media sector; and Ostermann & Partners LLP.
Several international law firms operate in the market through associations with locally qualified lawyers. Wolf Theiss – Zagreb branch maintains a significant presence, as does Local lawyers in cooperation with Karanović & Nikolić, which has a network of offices across the Balkan region. Bardek, Lisac, Mušec, Skoko in association with CMS Reich-Rohrwig Hainz Rechtsanwälte GmbH (Austria) and Schoenherr in cooperation with Croatian lawyers are also active in certain areas.
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