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European Commission Publishes Progress Report for Croatia

May 2007 - Corporate & Commercial. Legal Developments by BABIC & PARTNERS Law Firm .

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On 9 November 2006 European Commission published the annual Progress Report for the year 2005. In addition to observance of general political and economic criteria, the Report also addresses the issues of alignment of specific legal fields with the European acquis as expressed in the Treaties, the secondary legislation, and the policies of the European Union.

With respect to the company law, in its chapter 6 the Report stresses the fact that the level of legislative alignment in this field is already relatively advanced. From comparison of the existing Croatian legal rules with the present state of acquis, it appears that further approximation-driven legislative actions could be expected with respect to e.g. takeover rules, cross-border mergers, single registry requirement etc.

During the year 2005, only the amendments to the Court Registry Act were adopted. The purpose of these amendments was to speed up the registration proceedings and to provide for online availability of documents held by the registry.

The Commission noted the establishment of internet based one-stop shop service to facilitate the company registration purpose. In this sense it was stated that the registration of the Company in Croatia generally takes 10 to 20 days. However, the Commission rightly observed that additional requirements (e.g. the need to obtain a proper license) significantly prolong the timeframe for setting up the business.

In addition, the Commission analyzed the status of accounting and audit services in Croatia. Although the Commission recognized that certain steps were taken with the view of complying with international standards, it also emphasized the need to make further progress in (i) enforcement of standards and (ii) supervision of professionals.

 

Contributed by Boris Andrejas, Associate at Babić & Partners

 

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