OASIS
ORGANIZATION OF ADVOCATES SPECIALISING IN INTERNATIONAL SERVICES
CROATIA 2008/2009
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ORGANIZATION OF ADVOCATES SPECIALISING IN INTERNATIONAL SERVICES CROATIA 2008/2009
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CROATIAN DEVELOPMENTS 2008/2009Slaven Šego ,Divjak, Topic & BahtijarevicM
The new Croatian Act on Architectural and Engineering Activities in Urban Planning and Development ("Act") came into force in the first days of the year 2009. The Act maintains the recently implemented requirement of licensing for all the developers performing the activities in Croatia, but consolidates the licensing process for various participants in the development market into a single act, as opposed to past three acts and chambers regulations. Croatian construction framework intends to establish a more permanent presence for the contractors who perform their activities in Croatia, in order to ensure they are familiar with the local regulations, properly staffed to responsibly conduct development projects in Croatia and present to guarantee their performance solidly on the long term. That is the reason that participants in construction are required to hold a licence, where solid and strict thresholds provide for obtaining one. The participants in construction are investor/employer, contractor/developer, and persons responsible for design, audit and supervision. All the licences are given out by the competent Ministry in an administrative procedure required to be finished within maximum 60 days after the applicant filed the complete licence application with all the required appendices. Construction licences are given out for engaging into construction of a certain structure classes, depending on the structure type and contract value for the particular type of work the developer usually engages in. Construction licences are not particular for the certain structure, but for all the structures falling in the class of licence issued. The Act provides for 7 classes of buildings, i.e. classes of licences and each licence requires certain degree and competence of developer's staff. Once the Croatia is a EU member state, all the developers bearing a licence in the country of its head office will be freely entitled to perform the licensed activities in Croatia, after making a mere notification to the relevant Croatian Ministry.
The PPP Act has been officially published in the Official Gazette no. 129/08 on 7 Nov 2008, and entered into force on the eight day after its publication, on 15 Nov 2008. The PPP matter was not previously materially resolved with a single act, but rather only in minor parts within other acts (on utility services, concession and others) and within guidelines published by the government in year 2006, whose application was not mandatory. Governmental guidelines only governed the PFI (Private Finance Initiative) PPP model, leaving the SPV and concession models intact. Guidelines did not draw much of an attention in practice, as they did not provide a straightforward model for a long-term liability of public sector. New 2009 PPP Act aims to provide a wide template to regulating PPP projects to be done in Croatia. In that aim stems the main Act's shortcoming; it leaves much of details to be settled within the by-laws – as much as four of them that the government is to pass within 90 days after the Act entered into force; so far, none of those by-laws has been enacted. Once in force, by-laws will govern the PPP agreement content, criteria for appraisal and selection of PPP projects, projects supervision and the education of participants. It is clear that a large portion of the matter is yet to be enacted. PPP Act provides provision on PPP projects preparation and adoption, relationships of the partners and the jurisdiction of the PPP agency which will be established. Private partner is to undertake the design, construction, maintenance and financing in the project, and public partner invests a right in rem, grants concession or pays a fee, while assuming the risk jointly. Basic provision on the PPP agreement sets only the agreement's term - 5-40 years with a renewal option. Agreement can be submitted to jurisdiction of Croatian courts, and then the Croatian law is applicable, or arbitration, where the parties are free to make the choice of law. By introduction of the SPV establishing possibility, the SPV PPP model is introduced, be it SPV founded by both the partners or just the public partner. Public sector can propose the projects, and the procedure for approving the projects is provided for. Approved projects go to tendering for the selection of the private partner.
The new Act on public procurement has been officially published in the Official Gazette no. 125/08 on 29 Oct 2008, and entered into force on 1 Jan 2009. Since there were changes in regulations of procurement in European Union these changes were made so that the Croatian act would be in accordance with Regulations and Directives from the European Commission and European Council (especially Directive 2007/66/EC and others). With the new Act on public procurement, the principles, procedure and legal protection from public procurement has been expended into Concessions and PPP matters. Strong anticorruption measures have been enforced with the new Act, and the entire procedure is much more transparent. All public works, procurement of goods and public services must be pursuant to the Act on public procurement. The new Act on Concessions has been officially published in the Official Gazette no. 125/08 on 29 Oct 2008, and entered into force on 1 Jan 2009. Although concessions were previously materially resolved with a single act, only a minor part of the matter was prescribed with it and it was regulated within other lex specialis. The new standards of regulation that Croatian law had to adopt regarding concessions were enforced with the new Act. The intention of the legislator was that the new Act not only defines concession but the complete allocation of concession, legal protection and all other questions regarding concessions.
A set of applicable intellectual property acts related to trademark, patent and industrial design rights, as well as to topography of semiconductor products enacted in 2003 (Official Gazette 173/03, 76/07), was recently amended by novelties enacted on March 16, 2009 (Official Gazette 30/09) which aim to further harmonize Croatian IP legislation with the existing EU system. Regarding the novelties in the Trademark Act, earlier geographical indications or designations of origin are set as new absolute reason for refusing a trademark protection provided that it relates to the same type of goods and services, whereas a trademark filed in the name of a trade agent or a representative of the right holder, without authorization of the right holder became one of the relative reasons for refusing trademark registration. In line with the Singapore Treaty, new amendments stipulate reinstatement of rights in the procedure for trademark registration in case of failure to meet time limit within two months. The most important novelty enacted by the latest amendments is the possibility of trademark invalidation based on the request of an interested party where the trademark holder acted in bad faith at the moment of filing the trademark application. Further novelties relate to the transformation of international registration into a national mark and to the Community Trademark. Namely, previous prohibition of use of CTM based on the request of an interested party for the refusal on any of the absolute grounds before the day of the accession of the Republic of Croatia into the full membership of the European Union, was cancelled. The main novelties in the Patent Act refer to procedures and terms of obtaining supplementary protection certificates and to provisions regulating limitation of effects in respect of patents in the field of biotechnology in terms of broadening its territorial scope. Another important amendment is the application of the London Agreement (the Agreement on the application of Article 65 of the Convention on the Grant of European Patents) regulating the content of the European patent translations. Changes of the Industrial Design Act are rather similar to those of the Trademark Act, in terms of amendments regarding the reinstatement of rights, cancelling prohibition of use of a Community design which has not been examined in Croatia and the term for responding to a refusal of extension of international design to Croatia is extended to 4 months as of the refusal notice date. Amendments of the Act on Protection of Topographies of Semiconductor Products relate to the exhaustion of rights - as of the accession of the Republic of Croatia to the European Union, the placement of protected topography or semiconductor product produced by the usage of protected topography by a person authorised to approve of commercial usage or topography or any other person with the previous person’s consent on the EU market or on the European Economic Area will be deemed as exhaustion of exclusive rights for the area of the Republic of Croatia.
The new Croatian Act on Prohibited Marketing ("Prohibited Marketing Act") has been officially published in the Official Gazette no. 43/09 on 1 April 2009, and entered into force on the eight day after its publication, on 8 April 2009. Marketing, as a commercial activity, has a tremendous influence on the consumers’ well being. Prohibited and misleading marketing can disturb or otherwise negatively affect market competition. Therefore, it was of a great importance for the Croatia to settle this area of law and to implement all the changes that certain EU Directives were subjected to in its legislation. The Unfair commercial practice directive 2005/29/EEC has been implemented in the Prohibited Marketing Act as well. The major issues covered by the Prohibited Marketing Act: - prohibition of misleading marketing - evaluation of misleading marketing - subject-matter and territorial jurisdiction - judgment - temporary injunctions The purpose for adopting the Prohibited Marketing Act was primarily to prevent misleading marketing between merchants and to establish minimum objective criteria for determining if the one in question can be misleading thus leading to unfair market competition.
The new Croatian Act on Product Safety ("Product Safety Act") has been officially published in the Official Gazette no. 30/09 on 20 Feb 2009, and entered into force on the eight day after its publication, on 27 Feb 2009. The purpose for adopting the new Product Safety Act was to enable further harmonisation of the Croatian product safety standards with EU standards as well as to effectively ensure product safety and official market control in Croatia. Since the issue of product safety is extremely important for undisturbed common market operation, Croatia, as the candidate state, had to continue transposing the respective EU legislation in its own one. Therefore, General Product Safety Directive 2001/95/EC, two Directives concerning liability for defective products 85/375 EEZ, 1999/34 EZ and the Directive concerning products which, appearing to be other than they are, endanger the health or safety of consumers 87/357/EEZ have been implemented in the Act and thereby became an essential part of the Croatian legal system. The major issues covered by the Product Safety Act: - the safety of products placed on the market - the legal terms of the Act - the requirements to be met by the products to be placed on the market - the obligations of producers and distributers - informing the public - market supervision The Product Safety Act defines more specifically the requirements for the safety of products in order to ensure that only safe products are placed on the market and that consumer, at any time, have all information concerning their safety, at their disposal.
E- Commerce Act entered into force on 8 Nov 2003 while the first amendments thereof entered into force on 17 Jun 2008. Article 4 item 2 of the Act is to be amended by the suggested amendments of the Act, which are to enter into force this year. The amendments are to regulate derogations from the rule stipulating for the obligation of the IT services provider to be obliged to provide and render services in compliance with the applicable laws and other regulations of the Republic of Croatia. Such provision is based on the state of origin rules whereby the Croatian laws are applicable only to such IT services providers founded and having their seat in the Republic of Croatia. Article 4 item 1 provides for derogations therefrom, i.e. from the application of law to IT services provider having their seat in the EU member state, even if the service offered is aimed at Croatian citizens. The suggested amendments provide for areas wherein the provisions of the state of origin rules, do not apply to IT services provider having their seat in the EU member state. The respective areas are copyright and similar rights, as well as industrial copyright; emission of electronic money if prescribed as a derogation, areas defined by special regulations on capital market pursuant to Article 44 item 2 of Council Directive No. 85/611/EEZ as of 20 Dec. 1985 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities, areas as defined by special insurance regulations relating to life and non-life insurance, all as defined by EEZ directives, areas of formal validity relating to the form of contracts creating or transferring real estate related rights, where such contracts are subject to mandatory formal requests pursuant to special regulations, areas of consumer contracts, the freedom of contracting parties to chose the applicable law with respect to their contract and the permissibility of spam messages. The suggested amendments shall enter into force as of the official admission of the Republic of Croatia to the full membership of the European Union.
The Capital Market Crimes Act (hereinafter: the „Act“) came into force in Croatia on 1 January 2009. The Act was adopted under speedy procedure since the new Capital Market Act was scheduled to come into force on 1 January 2009, and since the new Criminal Code reform is due in 2010, it was necessary to regulate crimes such as: using, disclosing and recommending privileged information, market manipulation, unauthorised provision of investment services, and unauthorised performance of tied agent's business. The new Capital Market Act also establishes new terms „privileged information“ and „maket abuse“ which are directly connected with crimes as set out within this Act. The Croatian Agency for Supervision of Financial Services (Croatian abbreviation: HANFA) shall pass a Regulation which would, in accordance with Directive EU no. 2273/2003, prescribe what is not considered to be „market abuse/manipulation“, and what is „standard/accepted market practice“ which is reasonably expected in a one or more financial market(s). These new crimes prescribe pecuniary penalties as well as jail time penalties of up to 5 (five) years and in absence of regulations in this act using of Criminal Code provisions is to be applied. Pursuant to Article 3 of this Act using, disclosing and recommending privileged information is to be fined pecuniary, or by imprisonment of up to three years. This article distinguishes whether considerable asset is acquired or whether considerable damage is committed in which case not „up to one year imprisonment“, but „up to three years imprisonment“ is prescribed. Furthermore this article distinguishes whether a crime is committed by a person who is a member of the administrative, management or supervisory bodies of the issuer; holder in the capital of the issuer; has access to the information through the exercise of its employment, profession or duties; or using, disclosing and recommending privileged information is acquired while committing a criminal offence. An attempt of the criminal offence of using privileged information is also be punishable under this provision. Article 4 prescribes market manipulation as well as an attempt of that as a criminal offence. Unauthorised provision of investment services is, under article 5, penalised with a fine or one year of imprisonment, while acquiring substantial economic benefits shall be punished with up to three years of prison. If a group is organised by a person to provide unauthorised investment services, a person who organises such a group shall be punished with up to five years imprisonment. Unauthorised performance of a tied agent's business is punishable with one or three years of imprisonment depending on whether a person who committed such a crime has gained substantial economic benefits or not.
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Organization of Advocates Specialising in International Services
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