CROATIA Trends and Developments Contributed by: Lovro Badžim, Badžim Law Practice
The Role of Croatian Insolvency Law in the Sporting Succession Debate Any discussion of sporting succession in Croatia must take into account the structure and logic of Croatian insolvency law. Unlike football regulations, Croatian bankruptcy law is designed to provide legal certainty, finality, and equal treatment of creditors. It does not recognise sporting succession as a legal category, nor does it allow liabilities to survive insolvency without a clear statutory or doctrinal basis. The Croatian Bankruptcy Act establishes a compre - hensive framework governing the consequences of insolvency, including the treatment of claims, the extinction of obligations, and the legal fate of insol - vent entities. Within this framework, the starting point is straightforward: once a legal entity has completed bankruptcy proceedings and is deleted from the court register, it ceases to exist, and its remaining obliga - tions are extinguished, unless the law expressly pro - vides otherwise. This principle is central to understanding why sport - ing succession raises sensitive legal questions in the Croatian context. From the perspective of domestic law, insolvency is not merely a financial failure but a legally regulated endpoint. Allowing liabilities to be reallocated after that endpoint, based solely on sporting or symbolic continuity, risks undermining the integrity of the insolvency system itself. Bankruptcy proceedings and the fate of creditors’ claims Croatian insolvency law places strong emphasis on the collective nature of bankruptcy proceedings. Creditors are required to actively participate by filing their claims within prescribed deadlines. Claims that are not duly reported cannot be satisfied from the bankruptcy estate. This system reflects a deliberate policy choice. Bank - ruptcy is intended to be a single, comprehensive forum for resolving all claims against an insolvent debtor. Once that process is concluded, legal cer - tainty demands that the outcome be respected. The law deliberately avoids fragmented or subsequent enforcement mechanisms that would allow individual creditors to circumvent the collective process.
From this perspective, any mechanism that allows claims to be pursued outside or after bankruptcy, against a different legal entity, sits uneasily with the core logic of the system. This tension becomes par - ticularly visible in football cases, where sporting bod - ies may seek to enforce unpaid claims through regula - tory tools rather than through the insolvency process itself. While sports regulation frames such enforcement as disciplinary rather than civil, the practical effect can resemble a reassignment of liability. For Croatian law, the concern is not merely formal but systemic: if bankruptcy does not conclusively resolve liabilities, its function as a stabilising legal institution is weakened. New clubs, old identities and legal discontinuity In practice, football clubs often reappear after insol - vency in a new legal form. They may adopt the same name, colours, stadium, and historical narrative as their predecessor. To supporters and local communi - ties, continuity may appear obvious and even desir - able. Under Croatian law, however, such continuity does not automatically translate into legal responsibility. The mere fact that a new club adopts the sporting identity of a former club does not, by itself, create an obligation to assume historic debts. Legal personality, not sporting identity, remains the decisive criterion. Legal responsibility may arise only in specific cir - cumstances. These include situations where there is formal legal continuity, such as a merger, universal succession, or other status transformation, or where it can be demonstrated that the new entity was created with the deliberate aim of avoiding the obligations of the old one. Absent such circumstances, Croatian law treats the new club as a distinct legal person, even if its sport - ing identity suggests otherwise. This position reflects a broader commitment to formal legal certainty over contextual or symbolic assessments of continuity. Abuse of rights as an exception, not the rule Croatian law does provide corrective mechanisms to address abusive behaviour. One such mechanism is
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