EU news, April 2013
Representative office - status in Croatia from 1st July 2013
In accordance with the Trade Act once Croatia becomes member of European Union article prescribing registering of Representative office in Croatia will no longer be applicable to the legal founders from the EU member state. This means that companies with its seat registered in EU countries will not be able to register Representative office in Croatia.
In respect to that specific provision, Ministry of Economy has published on its web pages that all representative offices currently registered in Croatia, by the founder coming from the EU member country, and planning on continuing its activity in Croatia after 1st July 2013, should register into the court registry as a branch or company.
Furthermore, all currently registered representative offices, registered by the founder from the EU member country, will be automatically erased from the register of representative offices in Croatia with 1st July 2013.
This leads to the conclusion that foreign entities should decide on how to regulate their business status in Croatia. Decision should be based on the type of business performance in Croatia, whether the activities could lead to the tax liability in Croatia or will they result in increase of administrative burden. In any case, if they decide to maintain their business presence in Croatia, they have to register branch office in accordance with the Companies Act.