The Legal 500

Croatia

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Editorial

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 Karanovic & Nikolic Josip Marohnic, Attorney at Law in cooperation with Karanovic & Nikolic, 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.

Local firm Law Firm Glinska & Miskovic Ltd is an associated member of the DLA Piper Group, while Bogdanovic, Dolicki & Partners has an association with Hogan Lovells International LLP.

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Legal Developments in Croatia

Legal Developments and updates from the leading lawyers in each jurisdiction. To contribute, send an email request to
  • Implementing Regulations on Public Procurement

    On 1 January 2008 the new Public Procurement Act came into force. However, following the coming into force of the new Act the Public Procurement Office, a regulatory body authorized to develop and coordinate the public procurement system in Croatia reported that in the practice the new Act is actually suspended until the regulations necessary for its implementation are adopted.
  • Amendments to the Personal Data Protection Act

    On 28 March 2008 Croatian Parliament enacted Amendments to the Personal Data Protection Act ("Amendments").
  • Amendments to Civil Obligations Act

    The currently applicable Croatian Civil Obligations Act was enacted in 2005 ("2005 Act") with a goal of harmonizing Croatian legislation with a number of EU Directives relating to combat against late payment in commercial transactions, self-employed commercial agents, sale of consumer goods and associated guarantees, liability for defective products, as well as package travel.
  • Amendments to Electronic Commerce Act

    On 17 June 2008 the Amendments to Electronic Commerce Act ("Amendments") came into force. These amendments are aimed at fully harmonizing Croatian electronic commerce regulations with the relevant EU laws.
  • One-Tier Corporate Governance System Introduced in Croatian Legal System

    On 3 October 2007 Croatian Parliament enacted the Amendments to the Companies Act which should enter into force on 1 April 2008 ("Amendments", "Act"). These Amendments represent the first substantial change to the Act since 2003.
  • New Takeover Act Enacted

    Background
  • New Public Procurement Act

    On 1 January 2008 the new Public Procurement Act came into force. The Act was modeled on a number of EU regulations concerning public procurement, most notably directive on coordination of procedures for award of public works, public supply and public service contracts, directive on procurement procedures of entities operating in the water, energy, transport and telecommunications sectors, as well as directive on review procedures to the award of public supply and public works contracts.
  • Resignation of a Member of the Management Board

    In a recently published decision, the Croatian High Commercial Court held that in corporations having two-tier corporate structure, the Supervisory board (as a body resolving on appointment and revocation of members of the Management Board) is not authorised or required to resolve on resignation of the Management Board's member. The court was on the standpoint that the resignation has legal effects as of the moment of its delivery to the Supervisory board. As a result, once the Supervisory board receives a resignation of a member of Management Board, it is not to discuss such resignation, but only undertake necessary steps to appoint new member of the Management Board and register the changes with the competent registry court.
  • Constitutional Court Rules on Squeeze Out

    According to recent press release, in February 2007 the Croatian Constitutional Court overruled the claim filed by minority shareholders of Siemens affiliate in Croatia. The minority shareholders requested the Constitutional Court to declare that rules on squeeze-out introduced into Croatian legal system under the 2003 Amendments to Companies Act are in violation of the Croatian Constitution. Under the disputed rules, shareholders' meeting may, at the request of the majority shareholder holding at least 95% of the shares, decide to transfer to such majority shareholder the shares held by minority shareholders, provided that the squeezed-out shareholders are paid appropriate compensation.
  • Regulation on Investment Fund Mergers

    Based on the authority granted under the 2005 Investment Funds Act, on 14 December 2006, the Croatian Agency for Supervision of Financial Services ("Agency") adopted the Regulation on Open Investment Fund Merger. The Regulation sets out a number of rules related to procedure, conditions and methods for merger of open investment funds in Croatia. The Regulation will come into effect on 30 December 2006.

Press Releases worldwide

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  • Lower VAT On Hotel Services In Montenegro

    An important piece of regulation has been introduced in Montenegro recently, through the reduction of VAT on catering services in four stars hotels (in the north of the country) and five-star hotels (on the seaside), which will be effective from 2018. According to media reports, Olivera Brajović, General Director of Tourism Development and Standards in the Ministry of Sustainable Development and Tourism, pointed out that these reduced tax rates on services of preparing and serving food and drinks are expected to raise the overall competitiveness in the hospitality sector, while at the same time contribute to the combat against grey economy.
  • Karanović & Nikolić Joins The NextLaw Global Referral Network

    Karanović & Nikolić is pleased to announce that it has joined the NextLaw Global Referral Network, created by global law firm Dentons. We are particularly excited by the fact that Nextlaw presents a new type of network, with a unique invitation-only approach in their selection, ensuring that all of its members have the highest quality standards and a proven track record of excellence.
  • Sweet Smell Of Success - Serbian Sugar Industry Consolidates Its Forces

    After more than a four months and a Phase II (in-depth) investigation, the Competition Commission gave conditional approval, to Sunoko's acquisition of the Star Šećer company and its subsidiary Te-To - the owner of the sugar factory in Senta. No divestments have been required from Sunoko.
  • New Bridge Over Danube To Be Built In Belgrade

    News reports are informing us that Belgrade will gain another bridge over the Danube river in the near future – this one at the Ada Huja island and over three kilometres long.
  • Nikola Tesla Airport To Acquire Sava Centar?

    Media outlets have recently been reporting on the possibility that Nikola Tesla Airport will acquire Sava Centar (SC), with the purpose of turning it into its company headquarters. This acquisition would be followed by an investment of over EUR 30 million in the next three years for the building's reconstruction and adaptation. Such a decision would result in Sava Centar changing its name to "Congress Centre Nikola Tesla Airport", with an expanded array of facilities, including a tower, a shopping mall, and a hotel. The funds for the investment in question will be hailing from the Airport's own assets.
  • Too Big To Hide – European Commission Sanctions Truck Cartel

    Global competition law circles have recently been shaken by the European Commission's record-setting fine of EUR 2.93 billion for collusion on the automotive market, imposed against Volvo, Daimler, Iveco and DAF trucks. The sanctions in question varied amongst the accused parties, with Daimler facing the largest penalty in the amount of more than EUR 1 billion on its own. Iveco's fine was set at EUR 494 million, DAF's at EUR 752 million, and Volvo's fine has been set at EUR 670 million.
  • Cartel Office ensures greater competition in rail sector

    The German railway company Deutsche Bahn must allow for more competition. The Bundeskartellamt, Germany’s Federal Cartel Office, found that the company had abused its dominant market position with respect to the sale of rail tickets.
  • ETERNA LAW IS PLEASED TO ANNOUNCE START OF THE COOPERATION WITH PUBLIC ASSOCIATION "ACADEMY OF PREVE

    Eterna Law (representative office in Almaty) announces the beginning of co-operation as a legal adviser with the Public Association "Academy of Preventive Medicine of Kazakhstan."
  • LAG Sachsen-Anhalt on video surveillance at the workplace

    Video surveillance at the workplace does not inevitably give rise to claims for damages. That was the verdict of the Landesarbeitsgericht (LAG) Sachsen-Anhalt [Regional Labour Court of Saxony-Anhalt] (Az.: 6 Sa 301/14).
  • Final stretch for loan withdrawal

    Those who still want to withdraw from real estate loans concluded between 2002 and 2010 should take action now while the right of withdrawal is on its last legs. This get-out-of-jail-free card is set to lapse shortly.