Business entities in Croatia

Business entities in Croatia

Healy Consultants will be happy assist our Clients starting doing business in Croatia with the right type of legal entity for their needs. The most commonly used one is the Croatian limited liability company, which is optimal for smaller businesses. This said, the Croatian joint stock company (JSC) can be also attractive, thanks to: i) formation costs similar to those of a LLC and ii) a paid-up capital of only €25,000.

The Croatia limited liability company (d.o.o)

    business entity types in Croatia

  • Croatian limited liability companies in can be registered with i) a single shareholder and ii) a single director, whom both can be of any nationality. At least one director is however required to be ordinarily resident of Croatia. The minimum capital required for Croatia company setup is low, at only HRK20,000 (€2,500);
  • All Croatian LLCs are required to i) have their balance sheet and annual financial statements prepared by a certified accountant and ii) file the same with the Croatian Business Register every quarter.

The Croatia joint stock company (d.d.)

  • A joint stock company (JSC) in Croatia can be incorporated with a minimum of one shareholder of any nationality;
  • Other minimal requirements to setup a Croatia JSC include an initial share capital of at least €25,000 (HRK200,000), fully paid up at incorporation. Our Client must also appoint i) a Board of directors comprising at least three members who can be of any nationality and ii) a certified accountant (can be provided by our Firm if needed);
  • Formation of a JSC allows entrepreneurs to raise capital in Europe in order to finance various expansions of their business, because i) Croatian corporate law does not restrict the issuance and transfer of shares by JSCs and ii) Croatian JSCs can be listed on multiple EU’s stock exchanges, including: i) Zagreb Stock Exchange; ii) EuroNext; and iii) Vienna Stock Exchange;
  • After Croatia business formation and in accordance with Croatia General Corporate Taxation Act, Croatian JSCs are required to i) have their balance sheet and annual financial statements audited by a certified accountant and ii) file them with the Business Register every quarter.

The Croatia branch office (also known as p.o.)

  • Foreign companies can do business in Croatia under their business name via a local branch office. Because branches are not considered as separate legal entities, their parent company will be subject to unlimited liability for losses incurred by the Croatian branch;
  • The Croatia branch must i) appoint a resident legal representative and ii) have its annual financial statements filed with the Business Register every quarter.

The Croatia representative office (also known as p.o.)

A great alternative to a branch office is the Croatian representative office. This entity can be 100% foreign owned, but cannot pursue any commercial activities in Croatia. As a result, this entity can only operate in i) promote the business of the parent company; ii) market research and iii) liaison activities.

Table of comparison between Croatia entities

 LLCJSCBranch officeRep office
Also known as:D.o.o.d.d.p.o.p.o.
How long to set the company up?2 weeks2 weeks2 weeks2 weeks
How long to open company bank account?3 weeks3 weeks3 weeks3 weeks
Enjoys limited liability in Croatia?YesYesNoNo
Minimum shareholders?1111
Authorities pre-approval needed to incorporate the company with a single shareholder?NoNoNoNo
Maximum foreign-ownership?100%100%100%100%
Minimum share capital?€2,500€25,00000
File annual tax return?YesYesYesNo
Corporate bank account options?Raiffeisen bankOTP bankSberbankZagreba?ka banka
Does our Client need to travel?YesYesYesYes
Resident director required?1110
Minimum directors allowed?1311
Corporate shareholders allowed?YesYesYesYes
Individual shareholders allowed?YesYesNoNo
Corporate director(s) allowed?NoNoNoNo
Croatia corporate tax rate?20%20%20%0%
Annual financial statements required?YesYesYesNo
Statutory audit required?NoYesNoNo
Allowed to issue sales invoices in Croatia?YesYesYesNo
Allowed to sign contracts with Croatia entities?YesYesYesNo
Allowed to import and export goods?YesYesYesNo
Can rent an office in Croatia?YesYesYesYes
Can buy Croatia property?YesYesYesNo
Can own equity in other Croatia companies?YesYesNoNo
Total Croatia business setup costs in Yr. 1€10,220€11,220€10,920€10,520
Subsequent annual costs (excl. accounting and tax fee)€3,440€3,440€3,440€3,440
Sample engagement fee invoice

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Contact us

For additional information on our company setup services in Croatia, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Mr. Petar Chakarov, directly:
client relationship officer - Petar