New Updates To The Companies Act In Croatia - January 2023

• Jurisdiction: European Union
• Law Firm: Kinstellar
• Subject Matter: Corporate/Commercial Law, Corporate and Company Law
• Author: Mr Edin Karaka', Vedran Kopilović and Zrinka Ivankovi&#263
• Published date: 17 February 2023

In this newsletter, we provide an overview of the:

• obligation of Croatian companies in connection with an adjustment of their share capital; and
• deadlines for the implementation of these obligations.

New rules regarding the obligation of companies to express share capital in euros

Since when?

On 1 January 2023, the euro became the official currency of the Republic of Croatia. As a result, a number of laws in Croatia have been amended. The changes mostly apply to amounts that were previously regulated in Croatian kuna.

The amendments to the Companies Act ("Act"), which came into force on 1 January 2023, prescribe the conversion of share capital from kuna to euros as a main obligation of companies. Amounts from kuna are converted in accordance with the rules of the Law on the introduction of the euro as official currency (Official Gazette 57/22, 88/22) and are rounded to the nearest cent.

Consequence of the failure to fulfil the new obligation - liquidation of the company

If a joint-stock company, a limited liability company or a simple limited liability company does not submit an application to register its share capital changes and its shares within the prescribed period, this will be considered, on the day following the deadline, as grounds for termination of the company, which the registration court will register in the court registry ex officio.

A. Joint-stock Companies

Share Capital & Shares

• the lowest amount of share capital is 25,000 EUR;
• the lowest nominal amount of one share is 1 EUR;
• nominal amounts of shares must be expressed as whole numbers.

Obligation

Joint-stock companies are obliged to convert into euros the current amount of their share capital, the nominal amount of shares and all amounts expressed in their statutes in kuna in such a way that they are expressed as a whole number.

Period to submit changes to the court registry

Joint-stock companies are obliged to submit to the court registry an application to register a change in the amount of their share capital and parts attributable to shares

• until 1 January 2024, or
• at the time of the first change in the share capital, or merger, division or exchange of shares with a nominal amount into those without a nominal amount, if such an event occurs before 1 January 2024.

B. Limited Liability Companies

Share Capital & Shares

• the lowest amount of share capital is 2,500 EUR;
• the lowest nominal amount of one share is 10 EUR;
• the nominal amount of shares must be expressed as a number that is...