March the 18th, 2021 - Croatian craft owners want their own slice of the EU funds cash pie as they feel they're being held hostage to various systemic restraints put in place by the government.

As Poslovni Dnevnik/Suzana Varosanec writes, numerous Croatian craft owners are set to end up in precarious positions in their expansion, even in terms of their export activities if the government fails to support them.

Leverage from their own capital is nowhere near enough, while on the other hand most of them don't plan to borrow, so the projects remain in the drawer, with everyone waiting for the outcome.

In order to push them with their own participation, there is a great interest among Croatian craft owners for non-refundable cash injections from European Union (EU) funds, and as a result, talks on this topic are expected from the Croatian Chamber of Trades and Crafts in the Government.

The key issue is the tender threshold, how to lower it from the existing one million kuna down to 150,000 kuna, which would ensure access to a large number of small entities to calls for such grants.

Results of the HOK survey

Through the Chamber's research on a sample of 1772 Croatian craft owners, the planned investments in property were crystallised - from the purchase of equipment and machinery to the reconstruction and construction of production facilities, in relation to which their participation in the National Recovery and Resilience Plan (NPOO) is required.

Unofficially, based on the value of the projects surveyed, it is an item which stands at approximately 100 million euros, while it is estimated that for this year the amount of non-refundable money would be in the range of 6 to 10 billion kuna, ie in seven years - about six billion euros.

In anticipation of answers to the problems of this group of entrepreneurs and the Chamber's proposal to advise the Prime Minister, they currently don't have an appointment, but will a joint solution with the government, in accordance with the intentions of this initiative led by HOK leader Dragutin Ranogajc, projects, which would be reflected on other small entities, will be seen quickly.

The predictable total value of the projects, according to the research, which would cover the needs of most Croatian craft owners, is from 150,000 to 750,000 kuna.

Croatian craft owners, they claim, are ready to immediately invest their own funds through co-financing these projects, but they also pointed out that more than 73 percent of the respondents aren't planning to use financial instruments.

The preparation of the necessary documentation

That is why HOK, as they say, is making efforts in the preparation of documentation in the field of drafting programming documents for the financial period of the EU 2021-2027.

The goal is to adequately identify the needs of Croatian craft owners and to provide them with appropriate calls for the allocation of EU money, which presupposes intervention to reduce the criteria to the previously mentioned 150,000 kuna.

They have previously warned that it is necessary to adjust the terms of the tender to Croatian craft owners, because according to Ranogajc, it must be borne in mind that "the economy is only as resistant as the smallest of its subjects are."

This approach is supported by economist Ljubo Jurcic, accompanied by the warning that without a systematic approach, there will be no great benefits to be had. He says that a system that produces added value should be built, in which the role of Croatian craft owners should be envisaged, who, he claims, also need a cash injection to cover the damage caused by the blockade due to the coronavirus crisis, in order to preserve any sort of pre-pandemic economic position.

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The Croatian Employers' Association (HUP) has welcomed changes to the Law on Companies and has urged that no new burdensome regulations be introduced.

As Ana Blaskovic/Poslovni Dnevnik writes on the 23rd of April, 2019, recent changes to the Law on Companies, which simplifies the establishment and the liquidation of companies, will enable entrepreneurs to be more competitive and help Croatia to climb up and improve its place on lists such as that of the World Bank, Doing Business, on which Croatia occupies 68th position out of 140 countries worldwide. 

The Croatian Employers' Association (HUP) has openly welcomed these positive changes, but has warned that this step in the right direction should not end up with people simply becoming lost once again but this time in a maze of new obstacles.

"The Croatian Employers' Association welcomes the simplification of procedures related either to the establishment of companies or to their liquidation, and we expect the introduction of changes that will stimulate the competitiveness of the Croatian economy and make it easier to monitor rapid changes on the global market," stated Admira Ribičić, the director of legislation and legal affairs at the Croatian Employers' Association which itself proposed changes in the same direction.

Better competitiveness should bring forward the ability to establish a simple and ''normal'' d.o.o. online, just with the payment of court fees, and without the cost of a public notary. The changes to the law open the doors for faster and easier business/company registration. However, even though e-foundation has now come into effect, the application that will enable it to function correctly will only come into force in September.

The Croatian Employers' Association has also readily welcomed the removal of the stipulation of reserving a company name, the shortening of the deadline for the court to make a decision on registration in the court registry from fifteen to five working days, as well as the provisions for the simpler and cheaper liquidation of a company, simply with a statement proving the non-existence of any debts.

"What worries us most is that we don't end up with a situation in which we remove a whole host of regulations and end up accidentally replacing them with different ones through changing the regulations. In Croatia, there are between 300 and 400 new regulations introduced annually, or amendments to existing ones, and each of them "laments" the danger of introducing a new administrative or financial burden,'' Ribičić concluded.

Make sure to follow our dedicated business page for much more on Croatian companies, doing business in Croatia, investing in Croatia and Croatian products and services.

Click here for the original article by Ana Blaskovic for Poslovni Dnevnik

Can one succeed in doing business on Croatian territory? Yes, one certainly can.

Asteria, a Croatian family company started by Dubravka and Veronika Vuković in the village of Banova Jaruga near Sisak in the continental part of the country, marked its first anniversary of being in business at the end of February 2019.

As Marta Duic/Poslovni Dnevnik writes on the 6th of April, 2019, this mother and daughter team successfully run their business which involves producing sleepwear, and the combination of Dubravka's long-standing experience in the textile industry and Veronika's knowledge gained about entrepreneurship at the Faculty of Economics in Osijek proved to be a winning combination.

"The two of us have always managed to create something together, and last year we had the chance to share that with the world. Our desire is to offer women quality sleepwear, ours is a different look than what is currently on our market, and that's why we decided to go with sleepwear. We want women to feel comfortable but at the same time feel elegant and confident in our clothes,'' explained Veronika Vuković.

Some of the Asteria branded underwear products include classic pyjamas, nightgowns, nightgowns, combos, dresses, kimonos and bathrobes, and fashion accessories such as sleeping masks and cosmetics bags.

"After the initial calculations, we started with the creative part and started working on the first models, there were a lot of attempts, a bunch of models from different fabrics, we played around with it all and tried out what would be the best, and we also asked our acquaintances to see what they liked the best, and soon after, we decided to take advantage of the self-employment incentives and open up an obrt (a type of company). At first, we needed some time because we knew only some of the very basics and not much more, and the biggest challenge were the Croatian state institutions and the vague information we received. We now understand the way they work and it's easier for us to talk to them,'' stated Vuković, reminiscing on Asteria's very beginnings.

The fabrics are mostly purchased from Italy and Germany and from some Croatian companies, and they're both [both domestic and foreign companies] responsible for the designs.

''Our products have been on the market for nine months now, and the web shop has been open for seven months. Special attention is paid to the design of the clothes and the selection of the fabric used in production, and each piece is manually sewn. I can say that we're getting better and better at it. When we started, no one knew about us and yet everything went easily.

Today, customers are already familiar with us and know where to look for our products, and on our web shop every month we have more orders than we had during the previous month. Customers often come back with some positive feedback, and we're particularly happy when they send us a picture of how they wear their clothes and how the clothes look on them,'' said Veronika Vuković, who prepares and delivers the items within four working days. In addition to Asteria's web shop and social networks, their products can also be viewed and purchased at their workshop in Banova Jaruga. Vuković noted that they aren't planning to open a classical type of store, at least for now.

"The type of clothes we make are made by almost nobody in the whole of Croatia. Although there are several Croatian companies that do sell sleepwear, it isn't similar to ours and is primarily different when it comes to the type of fabric being used.

Although these companies and foreign companies selling sleepwear are our competition, we're constantly working on being different to them and to make ourselves known for the variety and the quality of our products. As our greatest achievement, I would point out that customers have begun to recognise our products and recommend us to their acquaintances,'' said Vuković, noting that their current greatest efforts are investing in their proper positioning on the market as high quality garment manufacturers, as well as the expansion of their assortments and the entering into new markets.

"We're still not going to give too much away, but what I will say is that we're preparing stylish dresses, blouses and skirts in daytime, business and evening combinations, everything that a woman needs, and we want to focus more on sales in the EU and in the rest of the world in the future. They're much larger markets than our Croatian market here, and we believe our products have great potential,'' Vuković concluded.

Make sure to follow our dedicated Made in Croatia and business pages for much more on Croatian businesses, Croatian products and services, and Croatian success stories.

Click here for the original article by Marta Duic for Poslovni Dnevnik

Doing business in Croatia is always tricky, it's a long road often filled with an insane amount of paperwork and this bizarre requirement for you to physically go to multiple locations in order to get things done. Let's not forget the dreaded and archaic stamps, and the typical utter lack of desire on the faces of those apparently employed to help you. Is all that about to change with the country's gradual formation into a digital Croatia?

As Marija Brnic/Poslovni Dnevnik writes on the 29th of November, 2018, as of April the 1st next year, all those who want to start their own business in Croatia would be able to complete the process for registration and start doing business within just 48 hours. No, it isn't just an April Fools' trick.

A new business start-up system called Start will enable those who want to start their own businesses in the country to do just that, in a move which has been a deeply desired pipe dream up until now. With digital Croatia now finally on the horizon, getting your business off the ground is about to get a lot easier.

The service, which has been prepared by the Finance Agency (FINA), was finally given the green light following a government decision since last week. By the end of March next year, this system will be available to all those operating from within Croatia who own companies, including d.o.o and j.d.o.o's, while those abroad will see the service enabled for them by the end of 2019.

While start is an incredibly welcome news, it isn't the only player on the field, since 2005, Hitro.hr has been active, and is also a service from Fina. However, the Ministry of Economy, which is overseeing this project, clarified that there are some big differences between Hitro.hr and Start.

"Hitro.hr allows only the establishment of an Association or a company (obrt), or entry into the court or company register, while Start also enables the start-up of a business, which includes registration with the court and the company register, as well as entry into the register of business entities at the Central Bureau of Statistics, the filing of the beginning of the business and the beginning of the insurance with the Croatian Health Insurance Institute and the Croatian Pension Insurance Institute,the  registration of the taxpayers' register with the Tax Administration, registration in the VAT system, the opening of a bank account, and the electronic payment of any fees incurred during the process of all this,'' they explained from the Ministry of the Economy.

The beginnings of a digital Croatia will see that in the future, company owners will not physically have to go to all of the mentioned institutions as they currently need to, and all of the applications involved in this paperwork ridden and tiresome process will be able to be exported in one place by filling out a single digital form.

The establishment of this system amounts to 5 million kuna, as foreseen in the Ministry of Economy's budget, and in a year's time, it intends to back the project up with yet another half a million kuna.

Start requires automated communication and the exchange of data and documents between the ministries of economy, justice, finance, the tax administration, DZS, HZMO, HZZO, and credit institutions. Hitro.hr will not be harmed or otherwise threatened by the more than welcome launch of the Start system, as was confirmed by the Ministry of Economy, this service fulfills the objectives for which it was founded - better informing future entrepreneurs and providing better communication between people and the state administration, as well as offering far more ease and saving precious time when establishing a company.

"Hitro.hr will continue to provide services to users who need that kind of help - information ''at the counter'' and help with name reservations, or just the mere establishment of a company," the Ministry pointed out.

Fina added that if a user wants to start a business from their own home, they will beed to use Start, and if they want to start a business by going to the Hitro.hr counter and taking all the other steps individually, they will still have that option as well. Therefore, for those who prefer the "classic" Croatian way of starting a business, characterised by their physical arrival at the dreaded counter, Fina intends to keep the Hitro.hr offices open.

However, due to the ever-increasing trend in the digitisation of public services and the inclusion of newer generations in their use, Fina has also estimated that the percentage of those who prefer to use Start will grow year-by-year. Since the establishment of Hitro.hr, a large number of entrepreneurs have used it during the first step, especially when establishing a j.d.o.o., where every other such form of company since the service's introduction back in 2012, was established through Hitro.hr.

Altogether, Hitro has helped to create more than 57,000 new companies, of which some 32,000 are d.o.o.'s and 25,000 are j.d.o.o.'s. Obrt owners, however, have rarely used this registration service, since their start-up process is different, and since 2015, e-Obrt services have been introduced, which has completely taken over the registration processes of such companies.

The introduction of the Start system will not automatically open new jobs according to Fina's information. Currently, the offices of Hitro.hr are located in 61 Fina offices throughout Croatia, and information and support services are provided to them by Fina's existing employees, while as far as Start is concerned, as an online service, part of Hitro.hr staff will be engaged in staffing it via Fina.

Among the recommendations the World Bank gave to Croatia, the pressing need to create a more digital Croatia in order to improve the entrepreneurial climate was among the most outstanding, and it is precisely the creation of a unique online procedure, as opposed to the archaic dragging of one feet to numerous different offices in which processes are slow, confusing and often delayed, that will help paint a better picture of doing business in Croatia the most.

Interesting data from the analysis of Doing Business shows that starting up a business in Croatia is the easiest in Split, and there in the popular Dalmatian city are the largest number of Hitro.hr users. Out of five large Croatian cities, the worst results have rather surprisingly been recorded in Zagreb. According to Doing Business's analysis, more than half of Split's newly established companies use Hitro.hr, and for starting a business there, it is necessary to complete six individual procedures and the process typically lasts six days on average.

In Zagreb things appear bizarrely different, in the capital, a would-be entrepreneur has to complete eight different procedures and it takes a ridiculous average of three weeks for all the paperwork to be dealt with.

The welcome electronic changes that April the 1st, 2019, is set to bring owing to Start will require these procedures to be reduced in all cities across Croatia to just one step, and thanks to digital Croatia's roots finally being planted, the duration of this previously insanely time consuming process will go on for an absolute maximum of two days.

Make sure to follow our dedicated lifestyle and business pages for more information on digital Croatia and much more.

Click here for the original article by Marija Brnic for Poslovni Dnevnik

UK expat opens obrt – develops a kidney stone in the process.

Death and taxes, the Croatian way.

They say it takes a village to raise a child. The same could be applied to a very different sort of child: your own small business.

If you open a business and a venomous clerk wasn't around to make your life miserable, did you really open a business?

We recently wrote a guide on 'How to Open an Obrt', after going through the process myself which turned into a bureaucratical nightmare fraught with uhljebs at every turn, I thought it only right to pen the follow-up article from a foreigner’s perspective.