CROATIA Law and Practice Contributed by: Lada Ćustić and Marko Paulinović, Buterin & Partners
governed by the Law on Obligations. Depending on the specific terms and structure of the arrangement, Croatian legal theory may characterise these agree- ments either as a form of loan agreement or as a part- nership agreement. In the absence of regulation, such contracts remain legally permissible, provided they comply with the general rules of contractual validity and public policy. 2.2 Third-Party Funding: Lawsuits Since third-party litigation funding is not regulated under Croatian law, there are no express provisions limiting the types of proceedings to which it may apply. However, it may reasonably be assumed that such funding would be most relevant in commercial disputes involving monetary claims, where the value of the claim justifies the risk assumed by the funder. In addition, third-party funding may also be applicable in arbitration proceedings, particularly in high-value international commercial arbitrations where legal costs can be substantial. For private individuals who are unable to afford legal representation, the Croatian legal system provides access to legal aid, which may serve as alternative means of support. 2.3 Third-Party Funding for Plaintiff and Defendant As previously noted, the Croatian legal system does not regulate third-party funding and therefore does not impose restrictions based on the party’s procedural position. In principle, such funding could be available to both plaintiffs and defendants, provided that the nature of the funding agreement complies with the applicable provisions of contract law. The lack of leg- islative or judicial guidance means that the feasibility of such arrangements would likely be assessed on a case-by-case basis, taking into account the structure of the agreement and the financial interests involved. 2.4 Minimum and Maximum Amounts of Third-Party Funding There are no statutory minimum or maximum thresh- olds concerning the amount of third-party litigation funding in Croatia. Due to the absence of specific reg- ulation, the amount of funding is left to the discretion of the parties involved and would typically depend on the complexity of the case, the projected costs, and the potential value of the claim. As such, funders and
litigants are free to negotiate terms appropriate to the circumstances of the dispute, subject only to general contract law principles. 2.5 Types of Costs Considered Under Third- Party Funding Although third-party litigation funding is not regulated in Croatia, such funders, where present, might gen- erally consider covering all major litigation-related expenses. This could include legal representation fees, court fees, and expert witness costs, among others. The scope of funding would be determined by the terms of the agreement between the funder and the funded party. 2.6 Contingency Fees Litigation funding contingency fee agreements are not explicitly regulated under Croatian law. Consequently, they are not currently subject to any formal prohibi- tions or restrictions. 2.7 Time Limit for Obtaining Third-Party Funding There are no legal time limits or statutory deadlines imposed in Croatia for securing third-party litigation funding. Since this area remains unregulated, parties are free to enter into funding agreements at any stage of the proceedings, subject only to practical consid- erations such as the stage of litigation, procedural posture, and the funder’s own risk assessment. The flexibility in timing allows parties to seek funding even after the commencement of proceedings, provided that the funding arrangement complies with general contract law requirements.
3. Initiating a Lawsuit 3.1 Rules on Pre-Action Conduct
On a general note, there are no formal legal prereq- uisites that must be satisfied prior to initiating court proceedings in Croatia. Unlike some jurisdictions that impose mandatory pre-litigation protocols, such as letters before action or compulsory mediation, Croa- tian civil procedure does not prescribe specific con- duct before filing a statement of claim. However, for claims seeking compensation for damage (other than in employment law), the parties do have a statutory
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