Under the Croatian AML Act, the UBO is any natural person who ultimately owns or controls a legal entity, or otherwise exercises control over the client, and/or the natural person(s) on whose behalf a transaction is conducted, including any natural person(s) who ultimately exercises effective control over a legal person or legal arrangement. For corporations, a UBO is typically identified based on ownership or control. Firstly, through material ownership, which is defined as a person who directly or indirectly holds 25% plus one share, business stakes, or voting rights. Secondly, through control, which refers to a person who exercises a controlling position through other means, regardless of their ownership stake. If, after exhausting all reasonable efforts, no UBO can be identified based on the criteria above, the law establishes a substitute mechanism. In such cases, the members of the entity’s management board or an equivalent governing body are registered as its UBOs.

Which Entities Must Register Their UBO?

The obligation to register a UBO applies to most legal entities registered in Croatia, including business corporations (like d.o.o. or d.d.), branches of foreign companies, associations, and foundations. The law, however, provides for several exemptions, such as legal entities whose sole founder is the Republic of Croatia or a local/regional self-government unit, and joint-stock companies listed on a regulated securities market that are subject to equivalent EU disclosure requirements.

The UBO Identification and Registration Process in Croatia

The process involves both correctly identifying the UBO based on legal criteria and then formally registering them with FINA. The registration can be completed electronically via FINA’s web application or in person at a FINA office. New entities must register their UBO within 30 days of their establishment in the primary register (e.g., the court register). Any subsequent changes to the UBO data must also be reported within 30 days of the change occurring. ECOVIS provides full support throughout this process, from analyzing your ownership structure to managing the registration with the authorities.

Public Access to the Croatian UBO (Registar stvarnih vlasnika) Register

The Croatian Beneficial Ownership Register provides public access to key UBO data. In accordance with Croatian law, access to data contained in the UBO Register is subject to a fee. This fee must be paid by the legal or natural person requesting access.

The amount is set by the Croatian Agency (FINA). The official price list is publicly available on the websites of both FINA and the Ministry of Finance.

Therefore, if your company or representative wishes to obtain an extract from the Register, a fee may apply. For example, legal entities required to register beneficial ownership information currently pay €1.99 per extract, in accordance with the official price list.

The public can view the following information about a UBO via an online search portal:

• Full name
• Country of residence
• Month and year of birth
• Nationality
• Information on the nature and scope of their beneficial ownership

The public portal enhances transparency in line with EU directives. The register is also interconnected with the European Business Registers Interconnection System (BRIS) and the Beneficial Ownership Registers Interconnection System (BORIS).

Consequences of Non-Compliance in Croatia

Failure to comply with UBO registration duties carries significant sanctions that can directly impact a company’s operations and finances. The primary consequences include:

• Fines: Substantial financial penalties can be imposed for failing to register a UBO, providing incorrect information, or failing to update the data within the prescribed deadline. Fines for a legal entity can range from €660 to €46,500. Additionally, the responsible natural person within the company (e.g., a director) can be fined from €660 to €10,000.
• Business and Financial Restrictions: Incorrect or missing entries in the register can severely complicate business operations. Obligated institutions, such as banks and notaries, are required to check the UBO register as part of their due diligence. Non-compliance can lead to difficulties or refusal when opening bank accounts, securing financing, or executing transactions that require notarial certification.
• Exclusion from Public Procurement and Subsidies: A company that has not correctly registered its UBO may be excluded from public procurement procedures. Contracting authorities are required to verify the UBO of the selected supplier before awarding contracts. Similarly, providing accurate UBO information is often a prerequisite for receiving public subsidies or grants.

Ensure Your Compliance and Avoid Penalties in Croatia

Correctly identifying your Ultimate Beneficial Owner and ensuring their proper registration is a critical legal requirement. Our team of experts provides a comprehensive service that covers both the UBO identification based on your specific corporate structure and the complete handling of the registration process. By entrusting this task to us, you can be confident in your compliance and avoid the severe penalties associated with any errors.