Starting a business activity in Croatia / Establishing a company in Croatia
We will be happy to assist you in taking your first steps towards starting a business activity in Croatia. In particular, we provide you with comprehensive advice on choosing a suitable organizational form, for which in particular company law and tax criteria are decisive. When establishing a company in Croatia, we prepare the articles of association as well as all the necessary founding documents and take care of the coordination with the notary’s office.
Selecting a suitable form of organization in Croatia / Croatian corporate law
Croatian company law offers similar forms of organization for companies as the German company law. On the one hand, a branch office/representative office or taxable permanent establishment can simply be set up in Croatia as part of the German company, and on the other hand, it may make more sense to establish a Croatian subsidiary in individual cases.
Advice for already existing permanent establishments/subsidiaries in Croatia or for the purchase of an existing company in Croatia
We not only assist our clients in their beginnings in Croatia, but also subsequently advise them on their day-to-day challenges in their existing business. We also provide the necessary support in the event of major adjustments, such as the conversion of the company form.
A possible entry of your company in Croatia could also take place through the purchase of an existing Croatian company.
Conversion
In certain situations, adaptations of the existing are inevitable. We know this situation from our daily consulting practice and can achieve optimal solutions for your existing companies in Croatia with our expertise:
- Tax burden analysis and comparisons
- Tax-neutral changes and adjustments to the organizational structure
- Loss utilization strategies
- Preparation of company succession or sale
“Legal housekeeping” for existing companies in Croatia
We are also personally available to assist you with the smaller and larger legal issues arising from everyday business – from the clarification of minor legal questions on the phone to support in disputes between shareholders.
We can also help you with practical solutions in the following areas:
- Preparation and attendance of ordinary and extraordinary shareholders’ meetings
- Shareholder disputes
- Appointment and dismissal of managing directors
- Mergers and acquisitions
- Company dissolution and liquidation
Company acquisition / company valuation in Croatia
From the preparation and execution of the “due diligence” to the conduct of negotiations and the completion of a company acquisition in Croatia, our experts are at your disposal. We prepare all documents and contracts bilingually upon request. In addition, we support you in the concrete valuation of the target company. We also advise and assist you in determining the value in the run-up to the transaction.
Permanent establishment (branch, representative office) in Croatia / Subsidiary in Croatia
As under German law, the permanent establishment is not a corporate form, but it is also a way of organizing one’s business activities in Croatia. Articles 4 and 15 of the Profits Tax Act („Zakon o porezu na dobit, comparable to corporate income tax, hereinafter referred to as „GewStG“ govern the concept of permanent establishment and the taxation of a Croatian permanent establishment of a foreign company. According to Art. 4 of the Profits Tax Act (GewStG), the term “permanent establishment” means a fixed place of business through which the activities of a foreign enterprise are carried out wholly or partly in Croatia. Examples of a business establishment are:
- Place of administration (management),
- a branch office,
- a place of business
- a manufacturing plant,
- a workshop and
- a mine, oil or gas deposit, quarry or other site of exploitation of mineral resources.
The tax base of a permanent establishment is only the profit attributable to the Croatian permanent establishment (Art. 15 (1) GewStG). In accordance with the notion of independence of a permanent establishment under German tax law and the arm’s length principle, Art. 15 (2) GewStG stipulates that the profits shall be attributed to the permanent establishment which it would have been able to generate, if it had carried out an identical or similar activity under identical or similar conditions as an independent enterprise and had been completely independent in its dealings with the enterprise of which it is a permanent establishment.
National and International Tax Law
The double taxation agreement existing between Germany and Croatia needs be considered. We will also assist you with the following aspects of internationalization for your project in Croatia:
- Value added tax on cross-border supplies of goods and services between Germany and Croatia
- Minimization of the withholding tax on dividends/licenses/interest from Croatia
- Transfer pricing systems and transfer pricing documentation
- Avoidance of double taxation and cross-border tax optimization
- Intergovernmental mutual agreement procedures and APAs (Advanced Pricing Agreements)
- Avoidance of exit taxation and addition taxation
