CROATIA Law and Practice Contributed by: Iva Basarić, Marija Gregorić and Matija Skender, Babic & Partners
3. Recent Legal Developments 3.1 Significant Court Decisions or Legal Developments The introduction of the new FDI screening regime, which has not yet been fully implemented (due to its implementing regulation still not being put in place), has caused delays in the registration of changes of shareholders with the local registries. The delays have been driven by uncertainty on the side of registries as to which transactions they are allowed to process in a situation where it has not yet been established which target companies would be subject to FDI clearance. It is expected that the delays will stop once the screen - ing regime is fully implemented. Most M&A deals in Croatia (especially larger scale deals) are subject to arbitration, and decisions in dis - putes involving M&A deals are typically not publicly available due to the confidentiality of arbitral proceed - ings. In December 2019, a decision of the High Commercial Court of Croatia caused a stir in the local legal and business community in relation to M&A deals, particu - larly regarding the share transfer agreements required to effectuate and register a transfer of shares (ie, busi - ness quota) in Croatian limited liability companies. Under the law, these share transfer agreements must be made in a special form provided under Croatian laws before the Croatian notary public. Typically, in practice, the relevant agreements were signed locally on the basis of the powers of attorney on which the signature of the party (or the party’s representative) was notarised. However, the High Commercial Court decided that, due to general parity of form require - ments, the power of attorney should be made in the same form as the share transfer agreement (ie, that it is not sufficient for the signature on the power of attorney to merely be notarised). The High Commer - cial Court’s decision did not set a precedent proper (ie, the decision was only binding on the parties in the relevant proceedings), but it nevertheless resulted in uncertainty until the Croatian Companies Act was amended in early 2023 to expressly provide that it is sufficient to notarise the signature on the power of attorney used for execution of the share transfer agreement.
3.2 Significant Changes to Takeover Law The amendments to the Croatian Takeover Act came into force on 23 December 2025, ending more than a decade-long period in which no changes had been made to this legislation. The amendments are primar - ily aimed at transposing the Directive (EU) 2023/2864 of the European Parliament and of the Council of 13 December 2023, amending certain Directives as regards the establishment and functioning of the European single access point. In addition, the amend - ments clarify that references to money or funds do not include crypto-assets, as well as introduce certain changes as a result of digitalisation. 4. Stakebuilding 4.1 Principal Stakebuilding Strategies Stakebuilding in public companies prior to reaching the threshold for mandatory offer publication is pos - sible (and is not uncommon), but is subject to certain statutory requirements. 4.2 Material Shareholding Disclosure Threshold Disclosure thresholds are applicable to stakebuilding in publicly listed companies and apply when a natural person or legal entity directly or indirectly reaches, exceeds or falls below the thresholds of 5%, 10%, 15%, 20%, 25%, 30%, 50% and 75% of voting rights in a public issuer of shares. The relevant person/entity is required to simultaneously notify the issuer and the Croatian Financial Services Supervisory Agency of the fact that the above-listed thresholds have been reached or exceeded, or that voting rights have been disposed of below the relevant thresholds. 4.3 Hurdles to Stakebuilding The rules on mandatory takeover and the disclosure requirements are compulsory; companies cannot deviate from compulsory provisions, subject to pen - alties provided under the applicable laws. 4.4 Dealings in Derivatives Dealings in derivatives are allowed, but are also sub - ject to disclosure requirements.
363 CHAMBERS.COM
Powered by FlippingBook