May the 3rd, 2025 – The Voice of Entrepreneurs Association (UGP) recently warned that the new Croatian Law on Foreigners is stifling certain businesses.
As Poslovni Dnevnik writes, those suffering according to the UGP are micro and small companies, and this is primarily due to the lengthy process of issuing permits to foreign workers. On top of that, the rigidly prescribed minimum turnover requirement of 10,000 euros also poses a problem. The association is therefore proposing urgent solutions.
As they stated, the UGP has claimed to have received complaints from micro and small companies on a daily basis about having to wait months for permits to lawfully employ foreign workers. They pointed out that many have been rejected due to the rigid minimum turnover requirement of 10,000 euros in each of the last six months. For others, their applications have remained entirely unresolved for up to six months. The main reason for this, according to UPG, is the new Croatian Law on Foreigners and the inefficient and painfully (and infamous) slow system within the Ministry of the Interior (MUP).
“This legal solution is another example of a measure that directly harms micro and small businesses, and also shows the legislator’s worrying lack of understanding of the real circumstances of doing business in Croatia. That’s especially true for sectors such as tourism and construction, which are extremely seasonal in nature,” the UPG explained.
They cited an example of a construction company that can generate revenue of 500,000 euros in January, 300,000 euros in March, but due to a lack of turnover in February, it loses the right to employ foreign workers, even though its average monthly revenue is far above the prescribed minimum. It’s even more absurd, they noted, that these same companies on the coast are banned from operating during the summer months, and then reproached for not having a regular income.
They revealed that the situation is similar in tourism. The seasonality of business means that restaurants and other entities on the coast generate very little turnover in the winter, while during the summer they employ more workers and record typically very high revenues.
To the UGP, it’s clear that the new Croatian Law on Foreigners is directly harming businesses. As such, they have warned that these rules pose a serious threat to the very existence of thousands of families who depend on work in these sectors. They are therefore calling on the competent institutions to respond urgently. They have also proposed various solutions. Among those solutions is the suggestion that the Ministry of the Interior carries out the appropriate reallocation of personnel and strengthens the capacities of the sector dealing with issuing work permits. In addition, they suggest that the permit issuing process should be rationalised and limited in time to a maximum of 30 days from the submission of the proper documentation.
They also believe that the criteria for turnover should be adjusted to the real circumstances of business, taking into account in particular the seasonality of sectors such as tourism and construction.
“Due to inadequate legal solutions and the inefficiency of the system within the Ministry of the Interior, Croatian companies are being left without much-needed labour, and their businesses are being seriously endangered. The Voice of Entrepreneurs Association is therefore calling on Minister Davor Božinović and the relevant institutions to react urgently.
The Croatian Law on Foreigners should be adjusted to the real circumstances surrounding businesses on the market, and the system for issuing work permits should be reorganised and accelerated. The Croatian economy must fall victim to bureaucracy and a complete misunderstanding of key sectors such as tourism and construction,” concluded Boris Podobnik, president of the UGP.
