10 November 2022

Positive preliminary assessment of the satisfactory fulfilment of milestones and targets
related to the second payment request submitted by Croatia on 19 September 2022,
transmitted to the Economic and Financial Committee by the European Commission.
Executive summary
In accordance with Article 24(2) of Regulation (EU) 2021/241, on 19 September 2022, Croatia
submitted a request for payment for the second instalment of the non-repayable support. The
payment request was accompanied by the required management declaration and summary of audits.
To support its payment request, Croatia provided due justification of the satisfactory fulfilment of the
25 milestones and targets of the second instalment of the non-repayable support, as set out in Section
2(1)(1.2.) of the Council Implementing Decision of 20 July 2021 on the approval of the assessment of
the recovery and resilience plan for Croatia1.
For one target (#309) covering a large number of beneficiaries, in addition to the summary documents
and official listings provided by Croatia, the Commission services have assessed a statistically
significant sample of individual files. The sample size has been uniformly set at 60 which corresponds
to a confidence level of 95% or above in all cases.
In its payment request, Croatia has confirmed that measures related to previously satisfactorily
fulfilled milestones and targets have not been reversed. The Commission does not have evidence of
the contrary. This includes the measures in relation to milestone #157 (Establishment of the
implementation and audit and control system for the RRP) and the commitments on audit and controls
that were undertaken in the context of the first payment request to ensure continuous compliance
with milestone 157 and with Croatia’s obligations under the Financing and Loan Agreements. Based
on the documentation submitted, namely the summary of audits accompanying the second payment
request, Croatia has further elaborated and implemented the fraud risk assessment procedures.
Specifically, Croatia carried out risk assessments in accordance with the provisions of the Common
National Rules and ensured that they had designated risk coordinators. Furthermore, at the level of
the management and monitoring system of the RRF, the National Fund has aggregated all the
individual action plans, under the RRF management and monitoring system, into a joint Integrated
Fraud Risk Mitigation action plan containing measures to mitigate the specific risk of fraud of a given
activity, timeframe and risk mitigating persons from each authority. On the basis of the evidence
submitted, the Commission considers that Croatia has ensured continuous compliance with milestone
157 and with its obligations under the Financing Agreement with respect to these commitments.
Upon receipt of the payment request, the Commission has assessed on a preliminary basis the
satisfactory fulfilment of the relevant milestones and targets. Based on the information provided by
Croatia, the Commission has made a positive preliminary assessment of the satisfactory fulfilment of
25 milestones and targets.
The milestones and targets positively assessed as part of this payment request demonstrate significant
steps in the implementation of Croatia’s Recovery and Resilience Plan. They notably highlight the
continuation of the reform momentum in key policy areas. This includes, among others, several

1

ST 10687/21.

1

reforms in the areas of social policy with the new Social Welfare Act and training of social
professionals, energy with the assessment of the barriers to higher uptake of renewable energy
sources (RES), the adoption of the Hydrogen Development Strategy, a Decision on incentives for the
voluntary functional and actual mergers of the local government units (LGUs), as well as necessary
legal and administrative conditions for the further development of electronic communications,
including the 5G. The milestones and targets also confirm progress in the implementation of
investment projects related to the water management, labour market, education, social and justice
systems, as well as in the area of the green and digital transition of public authorities, SMEs and midcaps.
By the transmission of this positive preliminary assessment and in accordance with Article 24(4) of
Regulation (EU) 2021/241, the Commission asks for the opinion of the Economic and Financial
Committee on the satisfactory fulfilment of the relevant milestones and targets.

2

Contents
[Non-repayable support] ................................................................................................................... 5
Related Measure: 2 - HR-C[C111]-I[R1-I1] Digitalisation of government and public administration
services provided to the business sector (G2B).............................................................................. 5
Related Measure: 6 - HR-C[C111]-[R1-I2] Continuing administrative and fiscal burden relief .......... 6
Related Measure: 14 - HR-C[C111]-I[R4-I1] Support to enterprises for the transition to an energyand resource efficient economy ................................................................................................. 15
Related Measure: 16 - HR-C[C111]-I[R4-I2] Financial instrument for micro, small and medium-sized
enterprises ................................................................................................................................ 17
Related measure: 19 - HR-C[C111]-I[R4-I3] Financial instrument for mid-cap and large enterprises
.................................................................................................................................................. 20
Related Measure: 21 - HR-C[C111]-I[R4-I4] Financial instrument for public sector entities ............ 23
Related Measure: 25 - HR-C[C111]-R[R6] Developing resilient cultural and creative sectors ......... 25
Related Measure: 36 - HR-C[C12]-R[R1]: Decarbonisation of the energy sector ............................ 29
Related Measure: 50 - HR-C[C12]-I[R1-I3]: Hydrogen use and new technologies .......................... 31
Related Measure: 63 - HR-C[C13]-I[R1-I1] Public sewage development programme .................... 32
Related Measure: 68 - HR-C[C13]-I[R1-I2] Public water supply development programme ............. 34
Related Measure: 131 - HR-C[C15]-R[R2] Improving the agricultural land restructuring and
consolidation systems. ............................................................................................................... 37
Related Measure: 138 - HR-C[C15]-R[R4] Improving food donation systems ................................ 39
Related Measure: 160 - HR-C[C21]-R[R2] Strengthening the capacity to prepare and implement EU
projects ..................................................................................................................................... 42
Related Measure: 174 - HR-C[C22]-R[R4] Functional and sustainable local government ............... 43
Related Measure: 202 - HR-C[C23]-R[R4] Strengthening connectivity as a cornerstone of the digital
transition of society and the economy ........................................................................................ 46
Related Measure: 214 - HR-C[C25]-R[R1] Increasing the efficiency of the justice system to increase
citizens’ trust ............................................................................................................................. 49
Related Measure: 215 - HR-C[C25]-R[R1] Increasing the efficiency of the justice system to increase
citizens’ trust ............................................................................................................................. 53
Related Measure: 216 - HR-C[C25]-R[R1] Increasing the efficiency of the justice system to increase
citizens’ trust ............................................................................................................................. 55
Related Measure: 266 - HR-C[C31]-R[R1] Structural reform of the education system.................... 57
Related Measure: 286 - HR-C[C41]-R[R1] Development and implementation of new targeted active
labour market policies for the purposes of green and digital transition of the labour market ....... 62
Related Measure: 291 - HR-C[C41]-R[R3] Setting up a voucher system for adult education, training
and upskilling ............................................................................................................................ 64
Related Measure: 303 - HR-C[C43]-R[R1] Transparency and adequacy of social benefits in the social
protection system ...................................................................................................................... 65
Related Measure: 309 - HR-C[C43]-R[R2] Development of social mentoring service ..................... 67
3

Related Measure: 352 - HR-C[C61]-R[R1] Decarbonisation of buildings ........................................ 70

4

[Non-repayable support]

Number: 2

Related Measure: 2 - HR-C[C111]-I[R1-I1] Digitalisation of government and public
administration services provided to the business sector (G2B)

Name of the milestone: Operational digital platform to pay fees
Qualitative indicator: Digital platform to pay fees in operation

Time: Q2 2022

Context: The objective of this investment on ‘digitalisation of government and public administration
services provided to the business sector (G2B)’ aims at improving the accessibility, transparency, and
efficiency of public services for businesses through their digitalisation.
The milestone consists of creating and operationalising a new digital platform for the on-line payment
of the seven most frequent and cost-intensive compulsory business fees in Croatia. It enables a less
costly and administratively simpler business environment for the private sector, through
simplification and digitalization of administrative procedures.
Milestone #2 represents the initial step for completing investment C1.1.1.R1-I1 “Digitalisation of
government and public administration services provided to the business sector (G2B)”. The
investments include a series of other milestones and targets (#3, #4 and #5) that should be
implemented by Q4 2024.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the milestone (including all the constitutive
elements) was satisfactorily fulfilled (cover note),
b) A set of snapshots provided by the Ministry of economy and Sustainable development to
illustrate the different functionalities of the platform attached in the Annex to the Summary
document.
c) The certificate for works completion delivered by state-owned agency FINA, signed by the
Ministry of Economy and Sustainable Development (as contracting authority) and the
Financial Agency (as Executing authority) on 10 May 2022. certifying that the platform is
completed and operational, with link to the platform.
Analysis: Prior to this e-service, entrepreneurs had to refer to each individual institution to find the
information on their obligation as regards the payment of business fees. This digital platform, as
described in milestone #2, provides a “one-stop” application for information, but also for the
payment of the most common compulsory fees. The platform developed by the state-owned Financial
Agency (FINA) is operational for use since 30 March 2022.
The Certificate for works completion was signed by the Ministry of Economy and Sustainable
Development and the Financial Agency on 10 May 2022. The platform is accessible to the public
through national platforms: e-citizens (public services platform) and START (services for businesses).
According to the certificate of work completion, the platform developed by the state-owned Financial
Agency (FINA) has been operational for use since 30 March 2022.
Business charges targeted: The service provided through the platform includes seven mandatory fees
from different institutions:
i.
ii.
iii.

the tax administration fees (to be paid to the Croatian Chamber of Commerce
membership)
The tax administration fee (Croatian Chamber of Trades and Crafts chamber),
the Forest ecosystem service fees (Ministry of Agriculture),

5

iv.

v.
vi.
vii.

the levies for not meeting the employment quota for people with disabilities (Institute
for Expert Evaluation, Professional Rehabilitation and Employment of People with
Disabilities (ZOSI)),
the HRT Croatian Radio-television (HRT) subscription fee,
the tourist board membership fee (Tax Administration),
The Monument annuity (Tax administration).

These fees were identified as most frequent ones on the basis of surveys and consultations with the
business community and include typical contributions that most businesses must pay during the year.
The services provided through the platform can be expanded with the payment of other mandatory
fees.
Functionalities of the platform: with this new e-service, users get in one place the information on
the current balance of obligations for the main business fees they have to pay, based on their personal
identification number. User can pay fees directly, using their mobile or internet banking. The status
of the obligation is updated each time the user logs in to the service, by data which competent
institutions send to the platform at that point of time.
The platform includes different functionalities, including those identified in the description of the
Milestone in the CID annex: List of fees to be paid by the business operator (functionality 1), the
payment calendar with deadlines for their settlement (functionality 2), the possibility of direct online
payment of fees (Functionality 3) and the overview of commitments paid (functionality 4).
The user of the service can be a legally authorized person of a business entity or another person who
has been given an authorization to work in the service through the e-Authorization system. After login
(see snapshots, pictures 1 and 2), the user has access to the current balance of payments for a
particular business entity, due to institutions competent for the calculation, analytical monitoring and
collecting each fee (snapshots, pictures 3 and 4). In addition to access to the amount of fees and their
due payment dates (functionalities 1 and 2 in the CID annex), the service also provides the option of
entering data (snapshots, picture 8), complete and post forms as necessary (functionality 3), as well
as creating payment orders that can be executed using the business entity’s e-banking (snapshots,
pictures 5 to 7). After settling the payment due, the new balance will be visible (functionality 4) after
the institution competent for the collection records the payment and updates the balance in its
records (Snapshots picture 10). The e-payment platform for mandatory fees is protected in
accordance with the ISO 27001 standard. Security safeguards include TLS communication protocol
for data exchange, the National Identification and Authentication System (NIAS) for authentication,
the constant security surveillance (DAM) for the storage of data, protection systems against malicious
programs (AV and APT system) and other security systems that detect and prevent malicious network
traffic (IDS/IPS).
It is estimated that since the launch of the e-service on 30 March 2022 until 15 June 2022, the total
number of 1 321 users have signed in the e-service, representing 485 business entities. The platform
alleviated the burden for companies in the amount of HRK 118 million (ca. EUR 15.3 million)
mandatory fees, representing a 67% reduction of the of administrative burden reduction).
Commission Preliminary Assessment: Satisfactorily fulfilled

Related Measure: 6 - HR-C[C111]-[R1-I2] Continuing administrative and fiscal
burden relief
Name of the target: Implementation of the Action Plan to reduce non-tax and parafiscal charges
2020
Quantitative indicator: Percentage (100%)
Time: Q1 2022
Context:
Number: 6

6

The investment is aimed at further reducing the administrative and fiscal burden on businesses and
improving the business environment, thereby supporting implementation of measure C1.1.1. R1-I2
‘Continuing administrative and fiscal burden relief’.
This target (#6) consists of implementing the Action Plan to reduce non-tax and parafiscal charges.
The Action Plan to reduce non-tax and parafiscal charges was adopted by the Croatian government
on 7 May 2020. It contains 33 measures to reduce non-tax and parafiscal charges and 17 measures
to reduce fees for professional examinations.
Target #6 is the first target in an ongoing reform of the business environment under Investment
C1.1.1 R1-I2 ‘Continuing administrative and fiscal burden relief’.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the target (including all the constitutive elements)
was satisfactorily fulfilled.
The authorities also provided:
b) Copies of acts (legislative amendments and decisions) as evidence of the implementation of
33 measures to reduce parafiscal and non-tax charges and 17 measures to reduce fees for
professional examinations, as well as links to the Official Journal where applicable:
1. Decision on the financing of the Croatian Chamber of Economy (Odluka o financiranju
Hrvatske gospodarske komore, Official Gazette No. 139/20), published on 14 December
2020,
entered
into
force
on
1
January
2021
(https://narodnenovine.nn.hr/clanci/sluzbeni/2020_12_139_2693.html),
2. Decision on the mandatory chamber contribution for the unified craft organisation system
(Odluka o obveznom komorskom doprinosu za jedinstveni sustav organiziranosti obrta,
Official Gazette No. 146/20) published on 28 December 2020, entered into force on 1
January
2021
(https://narodne-novine.nn.hr/clanci/sluzbeni/2020_12_146_2841.html),
3. Law on the amendments to the Law on free zones (Zakon o izmjenama Zakona o slobodnim
zonama, Official Gazette No. 58/20), published on 19 May 2020, entered into force on 20
May 2020 (https://narodne-novine.nn.hr/clanci/sluzbeni/2020_05_58_1160.html),
4. Regulation on the amendment to the Regulation on the management of waste batteries
and accumulators (Uredba o izmjeni Uredbe o gospodarenju otpadnim baterijama i
akumulatorima, Official Gazette No. 57/20), published on 15 May 2020, entered into force
on
16
May
2020
(https://narodne-novine.nn.hr/clanci/sluzbeni/2020_05_57_1142.html),
5. Regulation on the amendment to the Regulation on unit charges, corrective coefficients
and detailed criteria and benchmarks to determine a special environmental charge for
motor vehicles (Uredba o izmjenama Uredbe o jediničnim naknadama, korektivnim
koeficijentima i pobližim kriterijima i mjerilima za utvrđivanje posebne naknade za okoliš
na vozila na motorni pogon, Official Gazette No. 2/21), published on 8 January 2021,
entered
into
force
on
16
January
2021
(https://narodne-novine.nn.hr/clanci/sluzbeni/2021_01_2_26.html),
6. Regulation on the amendment to the Regulation on unit charges, correction coefficients
and more detailed criteria and benchmarks for determining the fee on CO2 emissions
(Uredba o izmjeni Uredbe o jediničnim naknadama, korektivnim koeficijentima i pobližim
kriterijima i mjerilima za utvrđivanje naknade za emisiju u okoliš ugljikovog dioksida,

7

Official Gazette, No. 46/21), published on 30 April 2021, entered into force on 8 May 2021
(https://narodne-novine.nn.hr/clanci/sluzbeni/2021_04_46_934.html),
7. Regulation on the amendment to the Regulation on the amount of the water contribution
(Uredba o izmjeni uredbe o visini vodnoga doprinosa, Official Gazette No. 73/20), published
on 26 June 2020, entered into force on 27 June 2020 (https://narodnenovine.nn.hr/clanci/sluzbeni/2020_06_73_1414.html),
8. Decision on the amount of the fees for performing the activities of regulation of energy
activities (Odluka o visini naknada za obavljanje poslova regulacije energetskih djelatnosti,
Official Gazette, No. 38/22), published on 25 March 2022, entered into force on 2 April
2022
(https://narodne-novine.nn.hr/clanci/sluzbeni/2022_03_38_452.html),
9. Decision on the amendment to the Decision on changes to fees in waste vehicle and waste
tyre management systems (Odluka o izmjeni Odluke o izmjenama naknada u sustavima
gospodarenja otpadnim vozilima i otpadnim gumama, Official Gazette No. 57/20),
published on 15 May 2020, entered into force on 16 May 2020 (https://narodnenovine.nn.hr/clanci/sluzbeni/2020_05_57_1150.html),
10. Decision on the amendment to the Decision on the change of the fee in the waste oil
management system (Odluka o izmjeni Odluke o izmjeni naknade u sustavu gospodarenja
otpadnim uljima, Official Gazette No. 57/20), published on 15 May 2020, entered into force
on
16
May
2020
(https://narodne-novine.nn.hr/clanci/sluzbeni/2020_05_57_1149.html),
11. Decision on the amendment to the Decision on the fee for renewable energy sources and
high-efficiency cogeneration (Odluka o izmjeni Odluke o naknadi za obnovljive izvore
energije i visokoučinkovitu kogeneraciju, Official Gazette No. 57/20), published on 15 May
2020,
entered
into
force
on
1
July
2020
(https://narodne-novine.nn.hr/clanci/sluzbeni/2020_05_57_1151.html),
12. Regulation on the criteria for payment of the reduced fee for renewable energy sources
and high-efficiency cogeneration (Uredba o kriterijima za plaćanje umanjene naknade za
obnovljive izvore energije i visokoučinkovitu kogeneraciju, Official Gazette No. 57/20),
published on 15 May 2020, entered into force on 1 July 2020 (https://narodnenovine.nn.hr/clanci/sluzbeni/2020_05_57_1140.html),
13. Regulation on substances that deplete the ozone layer and fluorinated greenhouse gases
(Uredba o tvarima koje oštećuju ozonski sloj i fluoriranim stakleničkim plinovima, Official
Gazette No. 83/21), published on 21 July 2021, entered into force on 29 July 2021
(https://narodne-novine.nn.hr/clanci/sluzbeni/2021_07_83_1527.html),
14. Decision on the amount of the fees paid by the food business operators to cover the costs
of monitoring for food supplements for which notification of the placing on the market of
the Republic of Croatia is required (Odluka o visini naknade koju plaća subjekt u poslovanju
hranom radi podmirenja troškova provođenja monitoringa za dodatke prehrani za koje je
potrebno dostaviti obavijest o stavljanju na tržište Republike Hrvatske, Class: 011-02/2001/504, Reg. No: 534-02-2-2/4-20-2), adopted by the Minister of Health and entered into
force on 1 July 2020,
15. Decision on the amount of the fee to be paid by the food business operator to cover the
costs of monitoring for food supplements for which a decision must be obtained before
being placed on the market in the Republic of Croatia (Odluka o visini naknade koju plaća
subjekt u poslovanju hranom radi podmirenja troškova provođenja monitoringa za dodatke
prehrani za koje je potrebno ishoditi rješenje prije stavljanja na tržište Republike Hrvatske,

8

Class: 011-02/20-01/505, Reg. No: 534-02-2-2/4-20-2), adopted by the Minister of Health
and entered into force on 1 July 2020,
16. Decision on the amount of the fee to cover the costs of the procedure for the allocation of
the notification number at the time of the first placing on the market of the Republic of
Croatia of a food supplement (Odluka o visini naknade za pokrivanje troškova postupka
dodjele notifikacijskog broja prilikom prvog stavljanja na tržište Republike Hrvatske
dodatka prehrani, Class: UP/I-01-1-01/09-01/07, Reg. No:534-08-1-2/2-09-2), adopted by
the Minister of Health and Social Services on 22 January 2009,
17. Decision on the amount of the fee to cover the costs of monitoring the first marketing of
food supplements (Odluka o visini naknade za pokrivanje troškova obavljanja monitoringa
prilikom prvog stavljanja na tržište dodataka prehrani, Class: 011-02/12-01/34, Reg. No:
534-09-1-1-3/3-13-12), adopted by the Minister of Health on 9 April 2013,
18. Ordinance on determining the amount of fees to be paid for performance of activities of
the Croatian Civil Aviation Agency (Pravilnik o utvrđivanju visine naknada za rad Hrvatske
agencije za civilno zrakoplovstvo, Official Gazette No. 118/20), published on 28 October
2020
and
entered
into
force
on
1
January
2021
(https://narodne-novine.nn.hr/clanci/sluzbeni/2020_10_118_2297.html),
19. Order on determining the amount of fees to be paid for the performance of activities of
the Civil Aviation Agency (Naredba o utvrđivanju visine naknada za rad agencije za civilno
zrakoplovstvo,
Official
Gazette
No.
40/10)
(https://narodne-novine.nn.hr/clanci/sluzbeni/2010_04_40_1026.html),
20. Ordinance on amendments to the Ordinance on payment of fees for right to use addresses,
numbers and radio frequency spectrum (Pravilnik o izmjeni i dopuni Pravilnika o plaćanju
naknada za pravo uporabe adresa, brojeva i radiofrekvencijskog spektra, Official Gazette
No. 73/20), published on 26 June 2020, entered into force on 30 June 2020
(https://narodne-novine.nn.hr/clanci/sluzbeni/2020_06_73_1419.html),
21. Law on amendments to the Law on membership fees in tourist boards (Zakon o izmjenama
i dopunama Zakona o članarinama u turističkim zajednicama, Official Gazette No. 144/20),
published on 23 December 2020, entered into force on 1 January 2021 (https://narodnenovine.nn.hr/clanci/sluzbeni/2020_12_144_2766.html),
22. Law onamendments to the Law on forests (Zakon o izmjenama Zakona o šumama, Official
Gazette No. 145/20), published on 24 December 2020, entered into force on 1 January
2021 (https://narodne-novine.nn.hr/clanci/sluzbeni/2020_12_145_2795.html))
23. Ordinance on amendments to the Ordinance on the amount of fees for performance of
activities in accordance with the Law on sustainable use of pesticides (Pravilnik o
izmjenama Pravilnika o visini naknada za obavljanje poslova u skladu sa Zakonom o održivoj
uporabi pesticida, Official Gazette No. 87/21), published on 4 August 2021, entered into
force
on
1
January
2021
(https://narodne novine.nn.hr/clanci/sluzbeni/2021_08_87_1612.html),
24. Decision annulling the Decision on the type of services provided for a fee by the Agency for
Regional Development of the Republic of Croatia, Class: 001-01/17-02/1, Reg. No: 328-182 of 11 June 2018 (Odluka kojom se stavlja van snage Odluka a vrsti usluga koje Agencija
za regionalni razvoj Republike Hrvatske pruža uz naknadu, Class: 001-01/17-02/1, Reg. No:
328-18-2), Class: 910-05/19-01-1, Reg. No: 538-10-5-3/505-20-9, adopted by the Minister
of Regional Development and EU funds and entered into force on 8 June 2020,
25. Ordinance on amendments to the Ordinance on the amount and method of payment of
fees for metrological activities performed by the State Office for Metrology or authorised
legal entities (Pravilnik o izmjenama pravilnika o visini i načinu plaćanja naknade za
9

mjeriteljske poslove koje obavlja državni zavod za mjeriteljstvo ili ovlašteno tijelo, Official
Gazette No. 133/20), published on 2 December 2020, entered into force on 1 January 2021
(https://narodne-novine.nn.hr/clanci/sluzbeni/2020_12_133_2546.html,
26. Decision on the adoption of the Price List of Publications and Services of the Croatian
Bureau of Statistics for 2021 (Odluka o usvajanju cjenika publikacija i usluga Državnog
zavoda za statistiku, Class: 307-01/20/01/1, Reg. No: 555-01-02-03-20-1), adopted by the
Croatian Bureau of Statistics and entered into force on 16 December 2020,
27. 2020 Publishing programme of the Croatian Bureau of Statistics (Program publiciranja 2020
Državnog zavoda za statistiku),
28. Law on amendments to the Law on State Survey and Real Property Cadastre (Zakon o
izmjenama i dopuni Zakona o državnoj izmjeri i katastru nekretnina, Official Gazette No.
39/22), published on 30 March 2022, entered into force on 7 April 2022 (https://narodnenovine.nn.hr/clanci/sluzbeni/2022_03_39_477.html),
29. Regulation on the Administrative Charge Tariff (Uredba o tarifi upravnih pristojbi, Official
Gazette No. 92/21, 93/21 and 95/21), published on 20 August 2021, entered into force on
1
September
2021
(https://narodne-novine.nn.hr/clanci/sluzbeni/2021_08_92_1662.html, https://narodnenovine.nn.hr/clanci/sluzbeni/2021_08_93_1683.html,
https://narodnenovine.nn.hr/clanci/sluzbeni/2021_08_95_1734.html),
30. A comparison table of the provisions from the new and old Regulations on the
Administrative Charge Tariff,
31. Regulation on the amendments to the Regulation on fees for special costs for the provision
of information services of the State Intellectual Property Office (Uredba o izmjenama i
dopunama uredbe o naknadama za posebne troškove i troškove za pružanje informacijskih
usluga Državnog zavoda za intelektualno vlasništvo, Official Gazette No. 89/20), published
on 31 July 2020, entered into force on 8 August 2020 (https://narodnenovine.nn.hr/clanci/sluzbeni/2020_07_89_1679.html),
32. Ordinance on the amendment to the Falconry Ordinance (Pravilnik o izmjeni Pravilnika o
sokolarstvu, Official Gazette No. 122/20), published on 9 November 2020, entered into
force
on
17
November
2020
(https://narodne-novine.nn.hr/clanci/sluzbeni/2020_11_122_2373.html),
33. Ordinance on the amendment to the Ordinance on the amount of fees for performing
activities in accordance with the Law on Sustainable Use of Pesticides (Pravilnik o
izmjenama pravilnika o visini naknada za obavljanje poslova u skladu sa zakonom o održivoj
uporabi pesticida, Official Gazette No. 87/21), published on 4 August 2021, entered into
force
on
1
January
2022
(https://narodne-novine.nn.hr/clanci/sluzbeni/2021_08_87_1612.html),
34. Decision determining the amount of the fee for passing a professional exam for the
performance of recovery, leak checking, installation and maintenance or servicing activities
of appliances and equipment containing or relying on fluorinated greenhouse gases (SF6)
and on determining the amount of the remuneration of the members of the examination
body conducting the professional examination (Odluka o utvrđivanju iznosa naknade za
polaganje stručnog ispita za obavljanje djelatnosti prikupljanja, provjere propuštanja,
ugradnje i održavanja ili servisiranja uređaja i opreme koji sadrže fluorirane stakleničke
plinove (SF6) ili o njima ovise i o utvrđivanju iznosa naknade članovima ispitnog
ocjenjivačkog tijela koje provodi stručni ispit), Class: 351-01/20-04/14, Reg. No: 517-04-11-20-1, adopted by the Minister of Economy and Sustainable Development and entered
into force on 29 September 2020,
10

35. Decision determining the amount of the fee for passing a professional exam for the
performance of activities related to the collection, verification, installation and
maintenance or servicing of equipment and appliances containing or dependent on ozone
depleting substances or fluorinated greenhouse gases and on determining the amount of
the compensation to the members of the testing body conducting the professional
examination (Odluka o utvrđivanju iznosa naknade za polaganje stručnog ispita za
obavljanje djelatnosti prikupljanja, provjere propuštanja, ugradnje i održavanja ili
servisiranja opreme i uređaja koji sadrže tvari koje oštećuju ozonski sloj ili fluorirane
stakleničke plinove ili o njima ovise i o utvrđivanju iznosa naknade članovima ispitnog
ocjenjivačkog tijela koje provodi stručni ispit), Class: 351-01/20-04/15, Reg. No: 517-04-11-20-1, adopted by the Minister of Economy and Sustainable Development and entered
into force on 29 September 2020,
36. Decision on the amount of fees for the professional exam for the independent conduct of
geological surveys (Odluka o iznosu naknada vezanih uz polaganje stručnoga ispita za
samostalno obavljanje geoloških istraživanja), Class: 112-04/20-01/00510, Reg. No: 53303-20-0001, adopted by the Minister of Science and Education and entered into force on
22 December 2020,
37. Decision on the amendment to the Decision on the amount of compensation paid by
candidates for examinations for boat master, yacht master and seafarers' professional
titles, the method of payment of fees and distribution of proceeds (Odluka o izmjeni Odluke
o visini naknade koju plaćaju kandidati koji polažu ispite voditelja brodice, zapovjednika
jahte i stručna zvanja pomoraca, načinu uplate naknada i raspodjele uprihođenih
sredstava), Class: 342-01/10-07/32, Reg.No: 530-04-3-1-20-10, adopted by the Minister of
Sea, Transport and Infrastructure and entered into force on 12 November 2020,
38. Ordinance on the amendments to the Ordinance on the examination of professional
qualifications to engage in public road transport services (Pravilnik o izmjeni pravilnika o
ispitu o stručnoj osposobljenosti za obavljanje djelatnosti javnog cestovnog prijevoza,
Official Gazette No. 4/21), published on 15 January 2021, entered into force on 23 January
2021 (https://narodne-novine.nn.hr/clanci/sluzbeni/2021_01_4_79.html),
39. Decision of the Croatian Chamber of Pharmacists, Class: 023-08/20/-2/12, Reg. No: 33002-20-3, adopted and entered into force on 28 November 2020,
40. Decision of the executive body of the Croatian Chamber of Physiotherapists, adopted and
entered into force on 28 May 2020,
41. Decision of the State Geodetic Administration, Class: 133-01/18-01/10, Reg. No: 541-0701/1-20-2, adopted by the State Geodetic administration on 3 September 2020 and
entered into force on 1 October 2020,
42. Ordinance on the amendments to the Ordinance on the conditions for and form of the
examination for authorised metrology officer and repairer and the form and content of the
official identity card of the authorised metrology officer and authorised repairer (Pravilnik
o izmjenama Pravilnika o uvjetima i načinu polaganja ispita za ovlaštenog mjeritelja i
ovlaštenog servisera te obliku i sadržaju službene iskaznice ovlaštenog mjeritelja i
ovlaštenog servisera, Official Gazette No 133/20), published on 2 December 2020 and
entered
into
force
on
1
January
2021
(https://narodne-novine.nn.hr/clanci/sluzbeni/2020_12_133_2547.html).
c) A copy of the Action Plan for reduction of non-tax and parafiscal charges adopted on 7 May
2020 (‘Action Plan’),
d) A copy of the Government Conclusion of 7 May 2020 on the acceptance of the Action Plan
for reduction of non-tax and parafiscal charges.
11

Analysis:
The authorities provided separate evidence on the implementation of each of the 33 measures to
reduce non-tax and parafiscal charges and each of the 17 measures to reduce fees for professional
examinations. This was in line with the requirement specified in the description of the target, namely
to bring direct cost relief to the private sector by implementing the measures in the 2020 Action Plan
for reduction of non-tax and parafiscal charges.
The evidence provided accounts for the full implementation of the Action Plan in the areas of energy
activities, agriculture and the land cadastre, these areas of reduction being identified in the measure
description in the Council Implementing Decision.
1. Energy activities – 4 Action Plan measures
i.
Non-tax and parafiscal charges – 2 Action Plan measures
The fees for issuing permits for different energy activities are reduced by 25% (measure 8, act 8,
Official Gazette No. 38/22, baseline rates in Official Gazette Nos. 155/08, 50/09 and 103/09). A
reduction in the fee for the production of electricity from renewable energy sources applies to
energy-intensive industries which meet the criteria set by the Regulation on the criteria for payment
of the reduced fee for renewable energy sources and high-efficiency cogeneration (measure 11, act
11, Official Gazette No. 57/20).
ii.
Fees for professional examinations – 2 Action Plan measures
The full cost of two professional examinations for installation, safety and servicing procedures for
electrical, heating and cooling devices is assumed by the Ministry of Economy and Sustainable
Development, thus abolishing the fees. This includes activities to collect certain fluorinated
greenhouse gases from high-voltage switchgear, as well as activities to recover, perform leakage
checks, and install and service refrigeration, air conditioning and heat pumps (measure 7, act 34,
Class: 351-01/20-04/14, Reg. No.: 517-04-1-1-20-1 and measure 8, act 35, Class: 351-01/20-04/15,
Reg. No.: 517-04-1-1-20-1).
2. Agriculture – 15 Action Plan measures
i.
Non-tax and parafiscal charges – 11 Action Plan measures
The exemption from the fee for the use of public forest functions has been broadened and now
applies to legal and natural entities whose annual revenue or income, is below HRK 7.5 million, up
from HRK 3.5 million. Furthermore, the fee is reduced from 0.0265% to 0.024% of the total revenue
or income (measures 17 18 respectively, both in act 22, Official Gazette No. 145/20, baseline rates in
Official Gazette No. 68/18).
Fees applied to nine different categories of pesticide sprayers for the cost of their regular inspection
are reduced by 50 % (measures 19–27, act 23, Official Gazette No. 87/21, baseline rates in Official
Gazette No. 140/14).
ii.
Fees for professional examinations – 4 Action Plan measures
Fees have been reduced for basic and additional training as well as examinations required for
professional pesticide users, pesticide distributors and advisors on plant protection and safe use of
pesticides (measures 4, 5 and 6, act 33, Official Gazette No. 87/2021, baseline rates in Official Gazette
No. 140/14). A further measure is the reduction in the fee for the professional exam for falconry
(measure 3, act 32, Official Gazette No. 122/20, baseline rate in Official Gazette No. 47/19).
3. Land cadastre – 1 Action Plan measure
i.
Non-tax and parafiscal charges – 1 Action Plan measure
Fees have been abolished for the actual expenses related to the use of documents from registers
managed by the State Geodetic Administration, including the State Survey, Real Property Cadastre,
12

Infrastructure Cadastre, Register of Buildings, Register of Spatial Units and Register of Geographic
Names. The same applies to fees for certain procedures available on request (measure 32, act 28,
Official Gazette No. 39/22, baseline rate in Official Gazette No. 112/18).
4. Other- 30 Action Plan measures
i.
Non-tax and parafiscal charges – 19 Action Plan measures
Several measures provide relief that is not sector-specific, but rather applies to enterprises more
generally. A two-year exemption is granted from mandatory membership of the Croatian Chamber of
Economy and the Croatian Chamber of Trades and Craft for newly established enterprises and newly
established crafts (registered after 1 January 2021) (measure 1, act 1, Official Gazette No. 139/20 and
measure 2, act 2, Official Gazette No. 146/20, respectively). The obligation to pay a concession fee
for the establishment of (economic) free zones is abolished altogether through amendments to the
Law on free zones (measure 3, act 3, Official Gazette No. 58/20, baseline rate in Official Gazette, No.
44/1996). The 20% reduction in the fee for carbon dioxide (CO2) emissions concerns all companies
whose installations meet the criteria of such obligations (measure 6, act 6, Official Gazette No. 46/21,
baseline rate in Official Gazette No. 48/09, 73/07). The reduction in the membership fee for tourist
boards impacts a variety of economic activities classified into five tiers that are part of the tourism
sector (measure 16, act 21, Official Gazette No. 144/20, baseline rates in Official Gazette, No. 52/19).
A number of relief measures focus on charges related to the environment. The fee charged to the
producers of batteries and accumulators to offset waste management costs incurred by the
Environmental Protection and Energy Efficiency Fund related to their products is reduced by 6%
(measure 4, act 4, Official Gazette No. 57/20, baseline rate in Official Gazette No. 105/15). The special
environmental charge for the owners of motor vehicles is reduced by 50% for hybrid vehicles and 5%
for other vehicles, with vehicles using electric or alternative modes of operation exempt altogether
(measure 5, act 5, Official Gazette No. 2/21, baseline rates in Official Gazette No. 114/2014). The fee
for management of waste tyres is reduced by 3% for all types of vehicles (charged per tyre) and for
imported and/or produced tyres (charged per tonne) (measure 9, act 9, Official Gazette No. 57/20,
baseline rates in Official Gazette, no. 40/15). The fee for disposal of waste lubricating oils is reduced
by 10% (measure 10, act 10, Official Gazette No. 57/20, baseline rate in Official Gazette No. 95/15).
In addition, the disposal fee charged to traders who place on the market substances that deplete the
ozone layer and fluorinated greenhouse gases is reduced by 50% (measure 12, act 13, Official Gazette
No. 83/21, baseline rate in Official Gazette No. 90/14).
Further relief measures are in the areas of health, transport and communication infrastructure. The
cost of registration for certain categories of food (such as food supplements and foods purporting
health benefits) is reduced by 40% per unit fee for notices of marketing. When administrative
authorisation is needed to market the product, the reduction is 25% (measure 13, act 14, Class: 01102/20-01/504, Reg. No.: 534-02-2-2/4-20-2 and act 15, Class: 011-02/20-01/505, Reg. No.: 534-02-22/4-20-2, baseline rates in act 16, Class: UP/I-01-1-01/09-01/07, Reg. No.:534-08-1-2/2-09-2 and act
17, Class: 011-02/12-01/34, Reg. No.: 534-09-1-1-3/3-13-12). The fee charged to cargo shipping
airlines by the Croatian Civil Aviation Authority is reduced from 0.02 EUR/kg to 0.01 EUR/kg per tonne
of carried cargo (measure 14, act 18, Official Gazette No. 118/20, baseline rate in act 19, Official
Gazette No. 40/10). The annual fee for the use of unpaired radio frequency spectrum is reduced by
50% (measure 15, act 20, Official Gazette No. 73/20, baseline rate in Official Gazette No. 99/18 and
No. 154/08).
Several relief measures apply to both enterprises and individuals. The water contribution charge is
reduced by 50% for all obliged entities, including residential, public, commercial and industrial
buildings (measure 7, act 7, Official Gazette No. 73/20, baseline rates in Official Gazette No. 83/2015).
The Croatian Bureau of Statistics also reduced the fees for special data processing requests of users
13

by 10% (measure 31, act 26, Class: 307-01/20/01/1, Reg. No.: 555-01-02-03-20-1, baseline rates in
act 27, p. 121).
The reduction or abolition of administrative charges constituting state budget revenue is
implemented through the amendment to the Regulation on the Administrative Charge Tariff
(measure 33, act 29, Official Gazette No. 92/21, 93/21 and 95/21, baseline rates in act 30, the
comparison table between the amended and the previous Regulation). In Section A on general
charges, the Regulation establishes the applicable pecuniary level of the charge (tariff) for
administrative decisions by public administration bodies at the state, regional and local levels.
Reductions are achieved in the amended Regulation by establishing the general rule that no charges
apply before state administration bodies for administrative decisions (unless special charges apply).
Appeals against administrative decisions are not subject to a charge. The amended Regulation
contains 58 tariffs, in contrast to 95 tariffs before the amendment. Several tariffs in Section B on
charges in special areas were abolished or partially abolished. Taking into consideration relevance to
the business environment, this includes charges related to the licensing of business activities (notably
fees pertaining to the register of craft businesses), commerce (notably charges related to import and
export activity), cadastre, real estate acquisition procedures, transport, and implementation of
competition rules (procedures concerning market concentrations).
Fees imposed by the Agency for Regional Development for administrative and field controls related
to transnational and interregional cooperation programmes are abolished (measures 28 and 29, act
24, Class: 910-05/19-01-1, Reg. No: 538-10-5-3/505-20-9). Monthly fees owed by authorised legal
entities to the Croatian State Office for Metrology for maintenance of their systems (verification of
measuring instruments) are reduced from 15% to 10% or from 10% to 5% of the proscribed tariffs
(measure 30, act 25, Official Gazette No. 133/20, baseline rates in Official Gazette No. 121/14).
ii.
Fees for professional examinations – 11 Action Plan measures
The fees for professional examinations required for authorised representatives in the area of
industrial property rights are reduced, both for first-time examinations and for those taking the
examination a second time (measures 1 and 2, Act 31, Official Gazette No. 89/20, baseline rates in
Official Gazette No. 109/2011). Further reductions in fees for professional examinations are
implemented in various areas, including independent geological research (measure 9, act 36, Class:
112-04/20-01/00510, Reg. No.: 533-03-20-0001, baseline rate in the Action Plan, p. 18), maritime
navigation (measure 10, act 37, Class: 342-01/10-07/32, Reg. No.: 530-04-3-1-20-10 , baseline rate in
the Action Plan, p. 18), road transport (measure 11, act 38, Official Gazette No. 4/21), pharmacology
(measure 12, act 39, Class: 023-08/20/-2/12, Reg. No.: 330-02-20-3, baseline rate in the Action Plan,
p. 18), physiotherapy (measures 13, 14 and 15, act 40, baseline rate in the Action Plan, p. 19), geodesy
(measure 16, act 41, Class: 133-01/18-01/10, Reg. No.: 541-07-01/1-20-2, baseline rate in the Action
Plan, p. 19) and metrology (measure 17, act 42, Official Gazette No. 133/20, baseline rates in Official
Gazette No. 80/17).
The measures listed above are in line with the objective to improve regulatory conditions for
businesses and continue administrative and fiscal burden relief, as specified in the description of the
reform. All measures consist of reducing or completely abolishing fees, or they provide for a
temporary or permanent exemption from such obligations.
With the implementation of each of the 33 measures to reduce non-tax and parafiscal charges and
the 17 measures to reduce fees for professional examinations, as listed and described above, the
100% target to implement the 2020 Action Plan to reduce non-tax and parafiscal charges has been
reached.
14

Regarding the milestone requirement to bring direct cost relief to the private sector, the relevant
measures are estimated by the Croatian authorities to reduce the burden on the economy by HRK
531 995 772.62.
Commission Preliminary Assessment: Satisfactorily fulfilled

Number: 14

Related Measure: 14 - HR-C[C111]-I[R4-I1] Support to enterprises for the
transition to an energy- and resource efficient economy

Name of the milestone: Publication of calls for funding for investments targeting environmentally
friendly activities with established eligibility criteria for applicants and projects (including DNSH
compliance criteria)
Qualitative indicator: Publication of notice of call for proposal for grants

Time: Q2 2022

Context:
The investment consists in granting support to small, medium-sized and mid-cap companies who
invest in productive investments in green technologies which contribute to an energy- and resourceefficient economy. It targets specifically the decarbonisation process of the energy-intensive
industries, which require considerable investments.
This milestone consists of launching the call for proposals to select eligible projects to receive
investment grants. The expected impact of the grant scheme is a reduction of harmful emissions by
at least 20% (compared with investments not aimed at energy efficiency and the use of renewable
energy sources), as well as a 20% use of recyclates and recyclable materials in the total material
volume in production.
Milestone #14 represents the initial step for completing the investment C1.1.1.R4-I1 “Support to
enterprises for the transition to an energy- and resource efficient economy”. Final step is
implementing target #15, according to which grants supporting at least 290 SMEs and mid-cap
companies shall be awarded by end 2024.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the target (including all the constitutive elements)
was satisfactorily fulfilled (Cover note),
b) The main document of the call for proposals documents (“Upute za prijavitelje”)
introducing the purpose and conditions of the grant scheme (Hereinafter “the Call
document”),
c) The eligibility and selection criteria for the award procedure (Prilog 3. Kriteriji postupka
dodjele”) (Annex 3 of the main call document), corresponding to the main technical
specifications of the call as referred to in the Operational arrangements, aligned with the
description, criteria and conditions set out in the description of the investments and
milestones in the CID,
d) A self-assessment questionnaire for applicants on compliance with the DNSH principle
(Annex 5 of the main call document).
Analysis:
The call for proposals was published on 1 July 2022 and re-published on 28 July 2022, after a revision
of the selection criteria to better cover the actual market needs in Croatia and ensure the
achievement of the connected RRP target #15.
15

1. Eligibility conditions: The targeted applicants are SMEs or a private mid-cap companies (Section
2.1 of the Call document, p.24). As required under the CID measure, grants shall only be awarded
to financially viable companies (Section 2.3 of the Call document). The milestone as described in
the CID refers to targeting support to energy-intensive industries; in line with this, the applicant
must be officially registered as active in the manufacturing industry and be active in one of the
fifteen energy-intensive industrial sectors identified in the call2 (Section 2.1 of the Call document),
including metalworking, textile, food, chemical, construction and woodworking industries.
As required by the CID, activities and assets under the EU Emission Trading System (ETS) achieving
projected greenhouse gas emissions that are not substantially below the relevant benchmarks
are excluded as per the provisions of the “further specifications” of the operational arrangements
(Section 2.6 of the Call document).
The planned project’s investments should contribute to one or the two following objectives, as
required by the measure description: a) promote a circular economy by introducing resource
efficiency in the production cycle and life cycle of products, including the sustainable supply of
primary and secondary raw materials; b) decarbonisation and emission reduction of energyintensive industries, including demonstration and deployment of innovative low-emission
technologies (Section 2.1 of the Call document).
The eligibility requirements are reiterated in detail in Annex 3 to the Call document (Section on
‘Criteria for verifying the eligibility of projects and activities’).
2. Selection criteria: the quality of the eligible project applications is assessed against a set of
criteria, including: the share of recyclates or recovered material to be used in the production, the
share of renewable energy used in the energy consumption, the energy savings achieved, the
CO2 reduction achieved, the creation of new jobs (FTE) directly linked to the project (Section on
Quality assessment of Annex 3 to the Call document, point 1). It ensures that at project level that
harmful emissions are reduced by at least 20% compared with investments not aimed at energy
efficiency and the use of renewable energy sources, and that the use of recyclates and recyclable
materials in the total material volume in production is at least 20%. These selection criteria were
designed in line with the climate tracking for the measure, as per Annex VI of the RRF regulation.
3. Actions targeted: concern investment in tangible assets and/or in activities (such as:
infrastructure; purchase of equipment and machinery or other capital expenditure; technological
developments; energy efficiency renovations and the preparation of environmental studies)
which directly contribute to the objectives of the call (Section 2.7 of the Call document).
4. Financial support (Section 1.6 of the Call document): The indicative breakdown of the distribution
of grants is the following: 40% for SMEs and 60% for mid-cap companies. The maximum amount
of EU grants for individual SMEs shall be up to EUR 1 000 000, while for individual mid-caps up to
EUR 4 700 000.
In line with Annex VI and VII of Regulation (EU)2021/241,
5. Compliance with the Do-not-significant Harm principle (DNSH): In line with the description of
the Measure in the CID Annex, and in order to ensure that the financial instruments activities
comply with the ‘Do no significant harm’ Technical Guidance (2021/C58/01), the Agreements and
Strategies provide that HAMAG-BICRO and HBOR ensure during the selection of projects that:

2

listed in the NACE 2007 (European statistical classification of economic activities), under sector C
Manufacturing industry. The 15 sectors selected are: the production of food products, production of beverages,
textile production, manufacturing of clothing, processing of wood and wood and cork product (except for
furniture), production of paper and paper products, printing and duplication of recorded records, production of
chemicals and chemical products, manufacturing of basic pharmaceutical products and pharmaceutical
preparations, production of rubber and plastic products, production of other non-metallic mineral products,
metal production, manufacture of finished metal products (except machinery and equipment), manufacturing
of machines and devices, furniture manufacturing

16

(i) the Commission’s Technical Guidance on sustainability proofing for the InvestEU Fund
(2021/C280/01) is applied (Call document p.29 and 40, Annex 5 to the Call document p.1 and
16).
(ii) The activities and assets as listed in the description of the measure in the CID annex are
excluded from eligibility (Section 2.6 of Call document Annex 5 to the Call p.9 and 10, Annex
3 to the Call p.10).
(iii) A verification of legal compliance with the relevant EU and national environmental legislation
of the projects for all transactions, including those exempted from sustainability proofing is
required (Section 2.6 of the Call document, Annex 2a of Annex 5 to the Call).
The “Self-assessment questionnaire on the compliance of the project with the DNSH principle”
(Annex 5) is meant to help the project applicants and the assessor to check and assess the legal
compliance, its impact on the climate and environment, as well as its environmental sustainability.
Commission Preliminary Assessment: Satisfactorily fulfilled

Number: 16

Related Measure: 16 - HR-C[C111]-I[R4-I2] Financial instrument for micro, small
and medium-sized enterprises

Name of the milestone: Establishment of financial instrument to support investment by micro,
small and medium-sized enterprises
Qualitative indicator: Agreements published between (i) the relevant
ministries (MINGOR or MINFIN and HAMAG BICRO, and between (ii) the
relevant ministry (MINGOR or MINFIN) and HBOR to provide favourable
financing conditions for investments and working capital assets necessary to Time: Q1 2022
carry out the investments and/or increase the scale of operations of economic
operators.
Context:
The objective of the investment is to further encourage investment activity on the Croatian market
by providing more favourable financing conditions for micro, small and medium enterprises (MSMEs)
in the growth and development phase (entities with access to finance) and supporting access to
finance of specific target groups that usually do not have such access (such as micro entrepreneurs,
start-ups, young entrepreneurs, investments in RDI or economic operators investing in less developed
areas).
This milestone aims to encourage investment by micro, small and medium-sized enterprises in new
technologies, the purchase of modern machinery, equipment, and increasing production and service
capacity, as well as green transition measures (such as the adoption of green technologies, the
introduction of business models based on the circular economy, renewable energy sources, energy
efficiency). The milestone achieves that through financial instruments (revolving funds) for loans and
interest-rate subsidies.
Milestone #16 represents the initial step for completing the investment C1.1.1.R4-I2 “Financial
instrument for micro, small and medium-sized enterprises”. The investments include two more
targets #17 and #18, according to which at least 1 300 loans and interest subsidies supporting microand small-medium size enterprises will be awarded by Q2 2026.

17

Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the milestone (including all the constitutive
elements) was satisfactorily fulfilled (cover note)
b) Copies of the Funding Agreements signed on 30 March 2022 by the Ministry of Economy
and Sustainable Development (MINGOR, in charge of the RRP measure), the Ministry of
Finance (MoF, RRP coordinating authority) and the entrusted authorities for the management
of the Instruments, establishing the funding Instruments:
1. Funding Agreement 1 (hereinafter “Agreement 1”) entrusting HAMAG-BICRO with the
management of a microcredit Instrument as well as with an Interest rate Subsidies
Instrument, with annexes related to the investment strategy for the Financial
instruments (hereinafter referred to as “Strategy 1”), the procedure for the
implementation and sustainability test and DNSH criteria, the list of applicable legal
framework and legally relevant documents, the list of restricted activities;
2. Funding Agreement 2 entrusting HBOR with a direct loan Instrument for micro-, small,
and medium business entities (hereinafter “Agreement 2”), with annexes related to the
investment strategy for the Instrument (hereinafter referred to as “Strategy 2”), and the
list of applicable legal framework and legally relevant documents.
3. Funding Agreement 3 entrusting HBOR with an Instrument of subsidies for interest rates
on loans for micro-, small and medium business entities (hereinafter “Agreement 3”),
with annexes related to the investment strategy for the Instrument (hereinafter referred
to as “Strategy 3”), and the list of applicable legal framework and legally relevant
documents.
The authorities also provided:
c) HBOR DNSH methodology,
d) HBOR DNSH self-questionnaire.
Analysis
1. Scope of support
In line with the description of the measure and the milestone in the CID Annex, the national Agency
for SMEs, innovation and investment (HAMAG-BICRO) and the national Bank for Reconstruction and
Development (HBOR) is mandated to manage four financial instruments (hereinafter referred to as
“Instrument(s)”) as follows:
(1) HAMAG BICRO microloans Instrument, under which direct microloans of up to EUR 100, 000
to be granted to companies with difficult access to commercial bank loans (Articles 1 and 15 of
Agreement 1, Section 2 of Strategy 1),
(2) HBOR loans Instrument, under which direct loans higher than EUR 100 000 to be granted to
projects borne by special target groups such as start-ups, young entrepreneurs, women
entrepreneurs, investments in disadvantaged areas and in research, development, and
innovation, which due to the higher degree of risk do not have access to bank financing (Art. 1
and 16 of Agreement 2, Section 2.1 of Strategy 2),
(3) HAMAG BICRO interest rate subsidy Instrument, which to be granted to projects borne by
micro, small and medium-sized enterprises benefitting already from HAMAG BICRO guarantee
instruments (Articles 1 and 15 of Agreement 1, Section 2 of Strategy 1),
(4) HBOR interest rate subsidy for lending to micro, small and medium-sized enterprises using
HBOR's existing lending programs (Article 1 of Agreement 3).

18

As per the description of the measure in the CID Annex, the supported investments for the eligible
enterprises directly contribute to (Section 2.2 of Strategies 2 and 3, Section 4 of Strategy 1):
(i) their green transition (with actions such as the adoption of green technologies, the
introduction of business models based on circular economy, renewable sources of energy,
energy efficiency etc.),
(ii) their digital transition (with actions such as the digitalisation of the production,
procurement and sales processes and other business areas, acquisition of digital technologies,
digital education of employees etc.) or
(iii) their competitiveness and resilience (with actions such as new technologies, purchase of
modern machinery, equipment, and to increase the production and service capacity, the
employment and business internationalisation etc.).
2. Financial support
In line with the description of the Milestone in the CID annex, as set out in (i) a minimum of EUR 27
898 772 is allocated to supporting environmentally friendly production processes and resource
efficiency in SMEs, with the expectation that at least EUR 11 128 934 is used to reduce greenhouse
gases; (ii) EUR 23 199 509 is dedicated to assisting SMEs in the digitalisation of operations; (iii) EUR
94 896 808 is dedicated to investments aimed at strengthening competitiveness and resilience. More
specifically, in line with the description of the measure in the CID Annex:
i.
under HAMAG BICRO micro-credits Instrument, it is expected that EUR 39 816 843 (HRK
300 000 000) of funding is granted, with a minimum of EUR 7 608 756 (HRK 57 328 173) to
supporting environmentally -friendly production processes and improving resource
efficiency in SMEs; EUR 6 327 139 (HRK 47 671 827) to help SMEs digitalising their
operations;, and the remaining EUR 25 880 948 (HRK 195 000 000) to investments aimed
at strengthening competitiveness and resilience (Article 9 of Agreement 1, Annexes 2 and
4 of Strategy 1).
ii.
under HBOR Direct loans Instruments, it is expected that EUR 66 361 404 (HRK 500 000
000) of funding is granted, with a minimum of EUR 12 681 260 (HRK 95 546 955) dedicated
to supporting environmentally friendly production processes and improving resource
efficiency in SMEs, EUR 10 545 231 (HRK 79 453 045) used to help SMEs to digitalise their
operations, and the remaining EUR 43 134 913 (HRK 325 000 000) dedicated to investments
aimed at strengthening competitiveness and resilience (Article 10 of Agreement 2, Section
2.3.2 of Strategy 2).
iii.
under HAMG-BICRO interest rate subsidy Instrument, it is expected that EUR 13 272 281
(HRK 100 000 000) of funding is granted, with a minimum of EUR 2 536 252 (HRK 19 109
391) dedicated to supporting environmentally-friendly production processes and
improving resource efficiency in SMEs, EUR 2 109 046 (HRK 15 890 609) used to help SMEs
to digitalise their operations, and the remaining EUR 8 626 983 (HRK 65 000 000) dedicated
to investments aimed at strengthening competitiveness and resilience (Article 9 of
Agreement 1, Annexes 2 and 4 of Strategy 1).
iv.
under HBOR interest rate subsidy Instrument, is expected that EUR 26 544 562 million
(HRK 200 000 000) of funding is granted, with a minimum of EUR 5 072 504 (HRK 38 218
782) to support environmentally friendly production processes and improving resource
efficiency in SMEs, EUR 4 218 093 million (HRK 31 781 218) to help SMEs to digitalise their
operations, and the remaining EUR 17 253 965 million (HRK 130 000 000) dedicated to
investments aimed at strengthening competitiveness and resilience (Article 10 of
Agreement 3, Section 2.3.2 of Strategy 3).
19

The above amounts under the Instruments cumulatively meet the requirements as set out in the
milestone description and provide support in the amount of: i) a minimum of EUR 27 898 772 to
supporting environmentally friendly production processes and resource efficiency in SMEs, with the
expectation that at least EUR 11 128 934 shall go to reducing greenhouse gases; (ii) EUR 23 199 509
dedicated to assisting SMEs in the digitalisation of operations; (iii) EUR 94 896 808 dedicated to
investments aimed at strengthening competitiveness and resilience.
3. Compliance with the Do-Not-Significant Harm (DNSH) principle
In line with the description of the Measure in the CID Annex, and in order to ensure that the financial
instruments activities comply with the ‘Do no significant harm’ Technical Guidance (2021/C58/01),
the Agreements and Strategies provide that HAMAG BICRO and HBOR ensure during the selection of
projects that:
i.
the Commission’s Technical Guidance on sustainability proofing for the InvestEU Fund
(2021/C280/01) is applied (Art.9 of Agreement 1, Art.10 of Agreements 2 and 3),
ii.
The activities and assets as listed in the description of the measure in the CID annex are
excluded from eligibility (Section 4 of Annex 1 to Agreement 1; Sections 2.3.2 of Annexes 1
to Agreements 2 and 3);
iii.
A verification of legal compliance with the relevant EU and national environmental legislation
of the projects for all transactions, including those exempted from sustainability proofing
(Art. 9 of Agreement 1; Art.10, 12 and 12(9) of Agreement 2; Art.10 of Agreement 3).
A DNSH methodology and questionnaire for the review and monitoring of investment has been drawn
up, to be also used by the financial intermediaries (Evidence d) and e) for HBOR Instruments; Annexes
2 and 4 of Strategy 1 for HAMAG-BICRO Instruments).
As per the provisions under the “further specifications” in the Operational Arrangements, the
project’s activities and assets under the EU Emission Trading System (ETS) achieving projected
greenhouse gas emissions that are not substantially below the relevant benchmarks have been
excluded. Where a supported activity achieves projected greenhouse gas emissions that are not
significantly lower than the relevant benchmarks an explanation of the reasons why this is not
possible should be provided (Section 2.3.2 of Strategies 1 and 2, Annex 4 to Strategy 1).
4. In line with the description of the Measure in the CID Annex, the Instruments are managed
separately from other ones managed by HAMAG-BICRO and HBOR (Art. 1 of Agreements 1, 2 and 3).
Unused funds or reflow from the Instruments through the reimbursement of the capital, are to be
used for similar purpose and with the same eligibility conditions with regards to environmental
impact (Art. 1 of Agreements 1, 2 and 3).
Commission Preliminary Assessment: Satisfactorily fulfilled

Number: 19

Related measure: 19 - HR-C[C111]-I[R4-I3] Financial instrument for mid-cap and
large enterprises

Name of the milestone: Establishment of financial instrument to support investment by mid-caps
and large companies
Qualitative indicator: Agreement between the competent ministry (MINGOR or
MINFIN) and HBOR to provide favourable (incentivising) financing conditions and
Time: Q1 2022
guarantees for investments and working capital necessary to make the investments
and/or increase the scale of economic activity published.
Context:

20

The objective of the investment is to promote the competitiveness and green and digital transition
of mid-caps and large companies by providing more favourable sources of financing their investment
growth in the short and medium term.
The milestone consists of setting up of two new financial instruments (revolving funds) (hereinafter
“Instrument”(s)): The first one grants (individual and portfolio) guarantees for new investment loans
and leasing financing necessary for the implementation of investments. The second one grants
interest rate subsidies for contracts under HBOR's existing lending programs.
Milestone #19 represents the initial step for completing the investment C1.1.1.R4-I3 “Financial
Instrument for mid-cap and large enterprises”. Final step is target #20 which envisages that at least
150 projects (totalling at least EUR 331 807 021) for mid-caps and large enterprises will be supported
through financial instruments by Q2 2026.
Evidence provided: In line with the verification mechanism set out in the Operational Arrangements,
the following evidence was provided:
a) Summary document duly justifying how the milestone (including all the constitutive
elements) was satisfactorily fulfilled (cover note),
b) Copies of the Funding Agreements signed on 30 March 2022 by the Ministry of Economy and
Sustainable Development (in charge of the RRP measure), the Ministry of Finance (RRP
coordinating authority) entrusting the management of the Instruments, establishing the
funding Instruments:
i.
Funding Agreement 1 (hereinafter referred to as “Agreement 1”) entrusting HBOR with
the management of a new umbrella guarantee Instrument, with annexes related to the
investment strategy for the Instrument (hereinafter referred to as “Strategy 1”), and the
list of applicable legal framework and legally relevant documents, the list of restricted
activities.
ii.
Funding Agreement 2 (hereinafter referred to as “Agreement 2”) entrusting HBOR with
the management of the interest rate subsidy, with annexes related to the investment
strategy for the Instrument (hereinafter referred to as “Strategy 2”), and the list of
applicable legal framework and legally relevant documents, the list of restricted activities.
c) An explanatory report issued by HBOR justifying how cooperation of itself with financial
intermediaries (banks and leasing companies) will achieve a “crowding in private sector” effect.
The authorities also provided:
d) HBOR DNSH methodology,
e) HBOR self-questionnaire.
Analysis:
1. Scope of support
In line with the description of the measure and milestone in the CID Annex, the national Bank for
Reconstructions and Development (HBOR) is mandated to manage 2 financial instruments
(hereinafter referred to as “Instrument(s)”) as follows:
1. Umbrella guarantee scheme targeting mid-caps and large enterprises, to issue guarantees for
investment loans and working capital loans necessary for the implementation of investments
and the growth of mid-caps and large entities.
2. Financial instrument of interest rate subsidies for lending to MidCap and large enterprises
using HBOR's existing lending programs.
The final beneficiaries of the financial instruments are MidCap and large enterprises (Article 1 of
Agreement 1, Section 2.3.2. of Strategy 1; Article 1 of Agreement 2, Section 2.3.1. of Strategy 2).

21

Companies in difficulties are excluded (Article 9 of Agreement 1 and Section 2.3.2 of Strategy 1, Article
9 of Agreement 2 and Section 2.3.1 of Strategy 2).
As per the description of the measure in the CID Annex, the supported investments for the eligible
enterprises should directly contribute to encourage/support investments of MidCap’s and large
enterprises, primarily investments in new technologies, procurement of modern machinery and
equipment and increase of production and service capacity, as well as measures for green transition
(such as green technologies, business models based on circular economy, renewable sources energy,
energy efficiency) of final beneficiaries’ (Section 2.3.3 of Strategy 1, Section 2.3.2 of Strategy 2). Digital
transition projects include the development and/or deployment of digital technologies (e.g.,
digitalisation of production, procurement, and sales processes) in individual business areas, as well
as the education of employees. Projects enhancing the competitiveness and resilience cover
investments in tangible and intangible fixed assets (new technologies, vehicles, and equipment;
construction and/or extension and/or adaptation/upgrading/regulation of business and/or
manufacturing and/or service facilities; etc.) relevant to increasing business volume, boosting
productivity, employment, business internationalisation, etc. (Section 2.2 of Strategies 1 and 2).
2. Financial support
In line with the description of the Measure and Milestone in the CID annex, the total allocation for
the umbrella guarantee Instrument amounts to EUR 79 633 685 and the allocation of the interest rate
subsidy Instrument amounts to EUR 26 544 562 (HRK 200 000 000. This is iset out in Article 9 of
Agreement 1 and Section of Strategy 2, Article 9 of Agreement 2 and Section 4 of Strategy 2, in line
with the description of the Measure and Milestone in the CID annex, ). More specifically, out of the
total amount of the measure, in line with the description of the milestone in the CID Annex:
(i) a minimum of EUR 26 544 562 is to be allocated to supporting environmentally friendly
production processes and resource efficiency in mid-cap and large enterprises, with the
expectation that at least EUR 10 617 824 is to be allocated to reducing greenhouse gases;
(ii) EUR 79 633 685 is to be dedicated to investments aimed at strengthening competitiveness
and resilience.
3. Compliance with the Do-No-Significant Harm (DNSH) principle
In line with the description of the measure and the milestone in the CID Annex, and in order to ensure
that the financial instruments activities comply with the “Do no significant harm” Technical Guidance
(2021/C58/21), the Agreements and Strategies provide that HBOR ensured during the selection of
projects that:
i.

the Commission’s Technical Guidance on sustainability proofing for the InvestEU Fund
(2021/C280/01) is applied (Art.10 of Agreements 1 and 2).
ii. The activities and assets as listed in the description of the measure in the CID annex are
excluded from eligibility (Section 2.3.3. of Annexes 1 to Agreements 1 and 2).
iii. A verification of legal compliance with the relevant EU and national environmental legislation
of the projects for all transactions, including those exempted from sustainability proofing is
carried out (Article 10 of Agreements 1 and 2).
As per provisions under the “further specifications” in the Operational Arrangements, the project’s
activities and assets under the EU Emission Trading System (ETS) achieving projected greenhouse gas
emissions that are not substantially below the relevant benchmarks have been excluded. Where a
supported activity achieves projected greenhouse gas emissions that are not significantly lower than
the relevant benchmarks an explanation of the reasons why this is not possible should be provided.

22

These provisions are reflected in Article 10 of Agreement 1 and Section 2.3.3 of Strategy 1, Article 10
of Agreement 2 and Section 2.3.2 of Strategy 2. A DNSH methodology and questionnaire for the
review and monitoring of investment has been drawn up, to be also used by the financial
intermediaries (Evidence d) and e)).
Final beneficiaries that derived more than 10% of their revenues during the preceding financial year
from activities or assets in the exclusion list are required to adopt and publish green transition plans
(Respectively Sections 2.3.3 and 2.3.2 of Strategies 1 and 2).
4.The financial instruments are managed separately from other HBOR instruments, and separately
from each other and other EU instruments (Article 15 (4) of Agreement 1, Article 14(4) of Agreement
2). Unused funds or reflow from the Instruments are to be used for similar purpose and with the same
eligibility conditions with regards to environmental impact (Articles 17 and 18 of Agreements 1 and
2, Sections 6 and 7 of Strategies 1 and 2).
Commission Preliminary Assessment: Satisfactorily fulfilled

Number: 21

Related Measure: 21 - HR-C[C111]-I[R4-I4] Financial instrument for public sector
entities

Name of the milestone: Establishment of financial instrument for more favourable financing of
public entities
Qualitative indicator: Publication of the Agreement between the competent
ministries (Ministry of Economy and Sustainable Development, Ministry of
Time: Q2 2022
Finance) and HBOR containing eligibility and compatibility criteria for activities
and beneficiaries of the measures.
Context: The objective of this investment is to provide concessional financing to public entities to
stimulate public investment and improve the quality, efficiency and sustainability of public services
and reduce the cost of public sector financing.
Under this milestone, a financial instrument (hereinafter “Instrument”) for interest-rate subsidies is
established, that would benefit loans borne by the public entities (companies and institutions owned
by the State or local, regional government units) to develop necessary economic, municipal, transport
and social infrastructure, as well as investments in new technologies and systems.
Milestone #21 represents the initial step for completing the investment C1.1.1.R4-I4 “Financial
instrument for public sector entities”. The next and final step under this investment is the fulfilment
of target #22 that requires the provision of subsidised loans by HBOR for public sector projects in
accordance with the investment policy and eligibility criteria under milestone #21. It is expected that
the instrument will invest at least EUR 132 722 808 by end-June 2026.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the milestone (including all the constitutive
elements) was satisfactorily fulfilled (Cover note)
b) A copy of the Funding Agreement (Hereinafter “Agreement”) signed on 30 March 2022 by
the Ministry of Economy and Sustainable Development (MINGOR, in charge of the RRP
measure), the Ministry of finance (MoF, RRP authority) and HBOR, establishing the Financial
Instrument. It includes annexes related to the investment Strategy (referred to in below text
as “Strategy”), the list of applicable legal framework and legally relevant documents.

23

c) A “Model contract” to be signed between HBOR and other financial intermediaries (banks
and leasing companies). This contract includes provisions regarding the share of funds per
main investment priorities (Article 1 (7) of the model contract, and the compliance with the
DNSH principle (Article 5 of the model contract)
The authorities also provided:
d) HBOR DNSH methodology
e) HBOR self-questionnaire.
Analysis
1. Scope of support
In line with the description of the measure and milestone in the CID Annex, the national Bank for
Reconstruction and Development (HBOR) manages a grant interest subsidy financial instrument
(hereinafter “Instrument”) to reduce the ordinary interest on credit and leasing placements granted
to public sector entities (Strategy, introduction to Section 2).
The eligible final beneficiaries are companies and institutions owned by the State or local, regional,
and regional government units. Companies in difficulties are excluded (Article 9 of Agreement,
Section 2.3.1 of Strategy).
As per the description of the measure in the CID Annex, through the Instrument, investment stimulate
the development of economic, municipal, transport and social infrastructure, as well as the
acquisition of new technologies and systems necessary to increase the efficiency of public sector
entities, improve the quality of public services and reduce the cost of public sector financing (Article
1 of Agreement, Section 2.1 of Strategy).
More specifically, in line with the description of the milestone in the CID Annex, the Instrument will
support (Section 2.2 of the Strategy):
(i) Green transition actions including green technologies, business models based on circular economy,
renewables, energy efficiency,
(ii) Digital transition actions including the development/deployment of digital infrastructure and
technologies, digital change in all forms of business and processes, as well as digital research and
marketing,
(iii) Other investments meant to increase the efficiency of public sector entities, which include
economic, municipal, transport, social (and other) infrastructures, investments in new technologies
and systems as well as investments in long-term tangible and intangible assets (new technologies,
vehicles, and equipment; construction and/or extension and/or adaptation/upgrade/design of
infrastructure and/or business and/or manufacturing and/or service facilities; etc.)
2. Financial support
In line with the description of the Measure and the Milestone in the CID annex (Article 9 (17) of the
Agreement, Section 4 of the Strategy), the planned allocation of EUR 26 544 562 (HRK 200 000 000),
of
which:
(i) a minimum EUR 7 963 368 shall be aimed at supporting environmentally friendly projects, with the
expectation that at least EUR 3 185 347 shall be allocated to reduction of greenhouse gases.
(ii) EUR 18 581 193 shall be dedicated to investments aimed at enhancing the sustainability and
quality of infrastructure.

24

3. Compliance with the Do-No-Significant Harm (DNSH) principle: in line with the description of
the measure and the milestone in the CID Annex, and in order to ensure that the financial
instruments activities comply with the ‘Do no significant harm’ Technical Guidance
(2021/C58/01), the Agreements and Strategies provide that HAMAG BICRO and HBOR ensure
during the selection of projects that:
i. the Commission’s Technical Guidance on sustainability proofing for the InvestEU Fund
(2021/C280/01) is applied (Art 10 of Agreement).
ii. the activities and assets as listed in the description of the Measure in the CID annex are
excluded from eligibility (Section 2.3.2 of Annex 1 to the Agreement).
iii. a verification of legal compliance with the relevant EU and national environmental
legislation of the projects for all transactions, including those exempted from sustainability
proofing, is carried out (Art 10 of the Agreement).
As per provisions under the “further specifications” in the Operational Arrangements, the project’s
activities and assets under the EU Emission Trading System (ETS) achieving projected greenhouse gas
emissions that are not substantially below the relevant benchmarks have been excluded. Where a
supported activity achieves projected greenhouse gas emissions that are not significantly lower than
the relevant benchmarks an explanation of the reasons why this is not possible should be provided
(Section 2.3.2 of Annex 1 to the Agreement).
Section A DNSH methodology and questionnaire for the review and monitoring of investment has
been elaborated, to be also used by the financial intermediaries (Evidence d) and e)).
Final beneficiaries that derived more than 10% of their revenues during the preceding financial year
from activities or assets in the exclusion list are required to adopt and publish green transition plans
(Strategy 2.3.2).
4. The management of the Instrument is based on the applicable methodologies and procedures
of the HBOR, on contracts and/or agreements between the HBOR and the Financial Institutions,
and on additional agreements to regulate the use of the interest Subsidies (Section 2.3.3 of the
Strategy).
The Agreement signed enable cooperation with other financial institutions and crowding in private
sector effect (Article 12 of the Agreement, Section 2.3.3. of the Strategy). A “Model contract”
between HBOR and other financial intermediaries (banks and leasing companies) has been provided,
setting out similar provisions as the one’s of the Instrument’s Agreement, in particular as regards the
allocation of funds per priority (see point 2 above) (Article 1 (7) of the model contract) as well as the
DNSH provisions (Article 5 of the Model Contract). The “Model contract” stipulates ensures that the
relevant requirements from the measure and milestone description are to be respected by the
financial intermediaries implementing the Instruments.
Commission Preliminary Assessment: Satisfactorily fulfilled

Related Measure: 25 - HR-C[C111]-R[R6] Developing resilient cultural and
creative sectors
Name of the milestone: Amendments to the legal framework
Qualitative indicator: Entry into force of the Electronic Media Act and
Time: Q2 2022
Law on Copyright and Related Rights.
Context:
The objective of the reform is to foster the online business activity of the cultural and creative sector
by providing a stable legal framework, considering the need to remove obstacles to commercial
Number: 25

25

exploitation of protected content in the Digital Single Market. The reform is largely linked to the
recent modernisation of the Union copyright and audiovisual media services framework brought on
by Directive (EU) 2019/790 on copyright and related rights in the Digital Single Market, Directive (EU)
2019/789 on the exercise of copyright and related rights applicable to certain online transmissions of
broadcasting organisations, and Directive (EU) 2018/1808 amending Directive 2010/13/EU on the
coordination of certain provisions laid down by law, regulation or administrative action in Member
States concerning the provision of audiovisual media services (Audiovisual Media Services Directive)
in view of changes regarding the Digital Single Market.
Under this milestone, the legislative framework should provide effective legal protection of authors
and facilitate online licensing of copyright works, thereby incentivising creative industries to adapt
their business activities to the digital environment and supporting the development of new and
innovative cultural and creative offer (products and services) on the internet. The reform is also
expected to facilitate the cross-border distribution of television audiovisual media services and radio
programmes, and to ensure transparency of ownership and funding of media service providers. It
should be noted that ‘direct injection’ is the term used in the context of transmission of programmecarrying signals by broadcasting organisations, rather than ‘direct signal circulation’ as specified in the
CID Annex. The latter term is used in the analysis.
This milestone is the only one under this measure.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the milestone (including all the constitutive
elements) was satisfactorily fulfilled (Cover note)
b) Copy of the publication in the Official Gazette on 14 October 2021 of the Copyright and
Related Rights Act (No. 111/2021)
c) Copy of the publication in the Official Gazette on 14 October 2021 of the Electronic Media
Act (No. 111/2021)
Analysis:
In line with the requirements of the Council Implementing Decision annex, the amendments to both,
the Law on Copyright and Related Rights and the Electronic Media Act, were adopted by the
Parliament and published in the Official Gazette on 14 October 2021.
As specified in Article 315, the Law on Copyright and Related Rights entered into force the eighth day
following its publication in the Official Gazette on 14 October 2021, with the exception of Article 69,
which entered into force on 7 June 2022, and Articles 217(3)(2)(a) and 218(3)(4)(a), which shall enter
into force on 1 January 2023. These latter provisions concern collective management of copyright in
specific cases for print publications and do not relate to any of the elements of the CID.
The Council Implementing Decision requires that the amendments to the legal framework have
entered into force. As specified in Article 108, the Electronic Media Act (EMA) entered into force on
the day of publication in the Official Gazette on 14 October 2021, with the exception of Articles 51
and 101 which shall enter into force on 1 January 2023. These latter provisions concern cultural,
linguistic and media diversity. According to Article 51, television broadcasters must invest at least 5%
of their total annual gross income generated in the pursuit of their activity in the previous year in
audiovisual works of independent producers in the current year. According to Article 101, in the first
year of application (2023) this requirement is set at 2.5%. No further legal act is necessary and as such
there is legal certainty that these provisions will apply. The reason for the entry into force of these
provision in 2023 is that the broadcasters must first plan the distribution of their income (in 2022),
and in the following year (2023) realise this plan by using the funds to meet the threshold on their
total annual gross income invested in audiovisual works of independent producers. Moreover, the
26

delay between the adoption of this law and the actual application of the provisions is considered both
limited and proportional, notably as the delay is for a short duration and is proportional to the time
necessary for the television broadcasters to prepare to meet the required level of investments into
audiovisual works of independent producers in the current year (the first year of application), by
taking them into consideration in their total annual gross income in the previous year.
The assessment of the Copyright and Related Rights Act and the Electronic Media Act is solely done
for the purposes of implementation of the Recovery and Resilience Facility. It is without prejudice to
the Commission’s findings in the conformity assessment of the notified transposition measures with
Directive (EU) 2018/1808, Directive (EU) 2019/789, and Directive (EU) 2019/7903 by Croatia.
1. Amendments to the Law on Copyright and Related Rights
Amendments to the Croatian regulatory framework in the areas of the copyright and related rights
are based on the requirements of the milestone in the Council Implementing Decision Annex to
‘support businesses in the field of cultural and creative sectors in adapting their business models to
the Digital Single Market and the new EU and Croatian regulatory framework’, as further specified in
the analysis below.
i.

Removing obstacles to the successful commercialisation of protected content on the
internet
The Law on Copyright and Related Rights sets the regulatory framework on copyright and related
rights and introduces provisions on the use of protected content on the internet, addressing more
recent developments in the Digital Single Market such as online content-sharing platforms and
ancillary broadcasting services, and taking into account the need to remove obstacles to the
successful commercialisation of protected content on the internet. As explained in the summary
document, before the adoption of the amended Copyright and Related Rights Act, the cultural and
creative sectors faced legal uncertainty when engaging in digital activities. Legal uncertainty and lack
of detailed and coherent rules prevented cultural and creative industries in Croatia from rapidly
transforming into new business conditions, and from benefitting fully from digital technologies. The
amendments to the legal framework analysed below have brought clarity on the applicable rules for
the use of creative content in the digital environment, which is contributing to the competitiveness
of businesses in the cultural and creative sectors in the digital environment, as well as to their capacity
to tap the potential of that market.
ii.

Establishing the effective legal protection of the authors of creative, cultural and media
content on the internet and supporting the development of new and innovative products
and services
To provide a basis for effective legal protection of the authors of creative, cultural and media content
on the internet, new rules have been introduced on online content-sharing platforms, as required
under Directive (EU) 2019/790. Based on the Directive, Articles 50 to 53 of the Law specifically address
the licencing of content on online content-sharing platforms. The online content-sharing service
3

Directive (EU) 2018/1808 of the European Parliament and of the Council of 14 November 2018 amending
Directive 2010/13/EU on the coordination of certain provisions laid down by law, regulation or administrative
action in Member States concerning the provision of audiovisual media services (Audiovisual Media Services
Directive) in view of changing market realities. Directive (EU) 2019/789 of the European Parliament and of the
Council of 17 April 2019 laying down rules on the exercise of copyright and related rights applicable to certain
online transmissions of broadcasting organisations and retransmissions of television and radio programmes and
amending Council Directive 93/83/EEC (Text with EEA relevance.) Directive (EU) 2019/790 of the European
Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and
amending Directives 96/9/EC and 2001/29/EC (Text with EEA relevance.)

27

providers are required to obtain an authorisation from rightsholders and to ensure fair treatment of
authors in licensing agreements, when they make available to the public protected content uploaded
by their users (Article 50). This provision will reinforce the position of authors and creative industries
when negotiating with online content-sharing platforms for the use of the content uploaded by users,
as well as their opportunities to be remunerated. A provision sets out the liability of online contentsharing service providers in case of unauthorised use of protected content, taking into account the
business model of such services based on users’ uploads, by requiring that they make their best effort
to swiftly address unauthorised uses, while not unduly restricting their operations (Article 51). The
online content-sharing service providers are required to operate an effective complaint and redress
mechanism for their users (Article 53). This set of rules provides for a clear framework for the
operation of online content-sharing services, which can facilitate digital innovation in the cultural and
creative sectors.
iii.

Fostering the cultural and creative industries by providing a stable legal framework for the
creation of online platforms and applications, facilitating the online licensing of creative,
cultural and media content
The new rules mentioned above (Articles 50 to 53) are facilitating the conclusion of licensing
agreements between right holders and online content sharing platforms and stimulating the creation
and sharing of content in the online environment, contributing further to a stable legal framework for
the development of online platforms. In addition, the new rules provide for collective licensing with
an extended effect to enable users to obtain licences more easily, without the need to engage in the
process of concluding individual contracts with authors of potentially large amount of copyrightprotected content. Mandatory collective management of rights and related rights is stipulated in
Articles 216 to 218. As provided for in Directive (EU) 2019/790, press publishers are recognised as a
new category of rightsholder. Further rules were introduced on the management of their rights and
to facilitate conclusion of licenses for use of their publications, which are widely used by new online
services (Part III Related Rights, Chapter 6). In addition, there are provisions addressing copyright
works created under an employment contract and during the public and state service (Articles 100 to
110), as well as commissioned works (Article 96 to 99). In both cases, a legal presumption is
introduced stipulating that the employer or the commissioner as the rightsholder, respectively, unless
proven otherwise. These amendments improve legal certainty for the licensing of creative, cultural
and media content in the digital market.
iv.

Facilitating the re-use of public content for creation of new innovative products and services
on the Digital Single Market for creation of new innovative products and services on the
Digital Single Market
In light of new uses of works enabled by digital technologies, limitations and exceptions to copyright
and related rights in the field of research, education and preservation of cultural heritage are updated
or introduced (Articles 187 to 212), based on the new EU copyright framework. Such provisions allow
use of protected works under certain conditions, without the authorisation of rightsholders, thus
facilitating the re-use of protected content in the digital and cross-border environment. In particular,
use of orphan works (Article 189), out-of-commerce works (Article 192), preservation of cultural
heritage (Article 191), text and data mining for scientific purposes (Article 187), cross-border teaching
(Article 199) is addressed. These new limitations and exceptions contribute to strengthening the
possibilities for collaboration, research, and innovation in the digital environment, thereby
stimulating production of new cultural and creative content.
v.

Facilitating the cross-border distribution of television and radio programmes, by providing
clear rules on so-called direct injection
Based on Directive (EU) 2019/789 the Croatian legal framework has been amended to reflect new
ways of accessing television and radio programmes, including online, and to facilitate the cross-border
28

distribution of such programmes. New rules have been introduced on retransmissions, direct injection
(Articles 44 and 45) and ancillary online services of broadcasters (Articles 48 and 49). These provisions
are facilitating the clearance of rights when radio and television programmes are made available
online and across borders, through the broadcasters’ online services (e.g., catch-up TV services) or
through retransmission operators (e.g., cable, satellite, IPTV retransmission services).
2. Amendments to the Electronic Media Act
Amendments to the Electronic Media Act introduce notably changes regarding the regulatory
framework for audiovisual media services, as specified in the annex to the Council Implementing
Decision. Relevant amendments to the legal framework include rules on video-sharing platforms,
related definitions, the protection of minors, and investment obligations on European works for ondemand audiovisual media services. In addition, changes relate to the transparency of media
ownership structures. Overall, the revised Act aims at improving the possibilities for independent and
Croatian producers of audiovisual works and providers of audiovisual media services to achieve
competitiveness and tap the potential of the market, thus promoting cultural, linguistic and media
diversity in the Digital Single Market.
i.
Promoting cultural, linguistic and media diversity
The revised Act contains provisions, based on the EU framework, which are supportive of European
and independent audiovisual producers, thus promoting cultural, linguistic and media diversity. For
example, on-demand audiovisual media services are required to secure at least a 30% share of
European works in their catalogues and ensure prominence of those works (Article 27). Moreover,
such providers are required to invest 2% of their total annual gross revenue in the production of
Croatian audiovisual works by independent producers, or to purchase Croatian audiovisual works
produced by independent producers (Article 27). Television broadcasters are required to invest at
least 5% of their total annual gross income generated in the pursuit of their activity in audiovisual
works of independent producers (Article 51). These provisions improve the visibility and availability
of audiovisual works of independent producers in the internal market and strengthen the offer of
European works.
ii.

Ensure transparency in the publication of ownership structures linked to the Register of
Beneficial Owners and the publication of this information on the media service and
electronic publications provider’s website, and introduce more transparency with regard to
information on amounts and sources of funding
With the revised Electronic Media Act, media service providers and providers of electronic
publications are required to report to the national regulatory authority, the Agency for Electronic
Media (AEM) their yearly income and sources of funding and need to publish this information on their
websites (Article 25). Media service providers likewise have the duty to report to the AEM information
on their ownership structure, along with the evidence from the register of beneficial owners, as well
as to swiftly report any changes to the ownership (Articles 61 and 63). These obligations are expected
to ensure transparency of media ownership structures and to improve the transparency of
information on amounts and sources of funding, as specified in the Council Implementing Decision
Annex.
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 36 - HR-C[C12]-R[R1]: Decarbonisation of the energy sector
Number: 36
Name of the milestone: Publication of an assessment document with recommendations to alleviate
barriers and administrative procedures restraining to higher uptake of renewable energy sources
Qualitative indicator: Publication of an assessment document by the Ministry
Time: Q2 2022
of Economy and Sustainable Development
29

Context:
The objective of the measure is to facilitate the decarbonisation of the energy and transport sectors
and to support the national contribution to the EU renewable energy target and achieving the 2030
target of 36.6% share of renewable energy sources that was set by Croatian National Energy and
Climate Plan (NECP).
The milestone addresses the production and publication of an assessment document of the existing
bottlenecks and aims to provide recommendations to alleviate barriers and administrative
procedures restraining the higher uptake of renewable energy sources.
Milestone #36 is the first step in the implementation of the related measure and is the base for the
next steps, Milestone #37 C1.2. R1 “’Entry into force of legislation and/or regulation to improve
uptake of renewable energy sources, including introduction of a premium-based system for the
support of renewable energy sources’, due in Q4 2022, and Milestone #38 C1.2. R1 ’Entry into force
of the Act amending the State Assets Act, which will provide a legal basis for the complete separation
of the management of the gas transmission system operator (Plinacro) from state-owned production
and supply activities’, due in Q4 2023.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the milestone was satisfactorily fulfilled (Cover note),
including the link to the website where the assessment document can be accessed.
b) Copy of the published assessment document, including a Decision by the Minister on the
publication of the assessment document (Ref 391-01/22-01/221 / 517-07-1-2-22-9).
c) Explanatory report demonstrating how the actions foreseen in the assessment document
contribute to achieving the objectives of the reform.
Analysis:
As set out in the Council Implementing Decision, the assessment document with recommendations
to alleviate barriers and administrative procedures restraining to higher uptake of renewable energy
sources was published on the website of the Ministry of Economy and Sustainable Development on
30 June 2022. Revised versions of the documents were published on 19 September 2022 and on 10
October 2022.
As stipulated in the CID Annex, the assessment document identifies the overly complex
administrative set-up and other so called ‘process-related’ type of barriers, restraining the higher
uptake of renewable energy sources. It then proposes solutions on how to tackle them, providing
recommendations on policy measures that aim to alleviate barriers and administrative procedures
restraining the higher uptake of renewable energy sources.
The introductory part of the assessment document addresses the legal framework and
administrative procedures through which renewable energy projects go through, starting from the
early stages of project development such as amending spatial plans to the actual construction and
commissioning of the project (pp. 5 – 16).
The assessment document provides the analysis of the relevant legislative framework, i.e., the new
Act on Renewable Energy Sources and High-Efficiency Cogeneration and the new Electricity Market
Act, as well as relevant bylaws. The assessment of the administrative procedures restraining to the
higher uptake of renewable energy sources, i.e. the assessment of bottlenecks, is focused especially
on: spatial planning; environment and nature impact assessment; obtaining permits and decisions
under the new Act on Renewable Energy Sources and High-Efficiency Cogeneration, Official Gazette
(No. 138/2021) and the new Electricity Market Act, Official Gazette (No. 111/2021); connecting to the
electricity grid; self-consumption of renewable energy; renewable energy communities; other
30

administrative procedures; register of renewable energy sources and cogeneration; and on
preferential producers and regulatory alignment. On the basis of the administrative procedure
presented and on the estimate of the duration of each phase, steps and obstacles are identified that
significantly affect the length of administrative procedures (pp. 16 – 31).
For all identified barriers (i.e., bottlenecks) recommendations are proposed in a way that ensures the
acceleration of procedures, to create a positive investment climate in the field of renewable energy
sources. Recommendations address the key obstacles identified in terms of the necessary
simplification of procedures and the necessary capacity building of participants in administrative
procedures.
The complete list of all 43 barriers with proposed recommendations, and the entity responsible for
the implementation and the timeline, can be found in the Annex I of the document (pp. 49 – 53). In
addition, p. 45 of the document presents the 10 main measures, that need to be implemented to
ensure that the preparation and implementation of renewable energy projects in Croatia will be
accelerated. Annex II (pp. 54 – 55 in the assessment document) provides for more specific information
regarding the recommendations that aim to strengthen the administrative and technical capacity at
the level of line ministries.
Furthermore, as stipulated in the CID Annex, an emphasis was placed on measures for promoting the
renewable self-consumption and renewable energy communities. Chapters 8 and 9 are dedicated to
analysis, recommendations and measures for promoting the renewable self-consumption and
renewable energy communities (ppp. 31 – 39). Special attention is given to deployment of renewable
energy communities and uptake of renewable self-consumption, which includes promotional
activities and allocation of potential funds (through grants, tax reductions, financial instruments, etc.).
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 50 - HR-C[C12]-I[R1-I3]: Hydrogen use and new technologies
Number: 50
Name of the milestone: Adoption of the Hydrogen Development Strategy
Qualitative indicator: Entry into force of the Hydrogen Strategy for Croatia
Time: Q1 2022
Context:
The objective of this measure is to improve the use of hydrogen and new technologies in Croatia, to
decrease greenhouse gas (GHG) emissions in transport sector and industry.
This milestone consists of the adoption of the Strategy that creates a strategic framework for
production, storage, transportation, use and application of hydrogen by 2030 and beyond, up to
2050. This is the first national strategic document of the Republic of Croatia on hydrogen.
This Milestone #50 is the second step in the implementation of the related measure. The next steps
are the fulfilments of Target #51 C1.2. R1-I3, (New hydrogen production capacity installed), due in Q2
2025, Milestone #52 C1.2. R1-I3, (Public tender for additional hydrogen capacity), due in Q2 2026,
Target # 53 C1.2. R1-I3, (at least 6 hydrogen charging stations for cars, buses and heavy-duty vehicles
have been built), due in Q2 2026, and the final step Milestone #54 (Pilot carbon capture and geological
storage (CCS) investment with a capacity of 190 000 tonne CO2/year), due in Q2 /2026.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following evidence
was provided:
a) Summary document duly justifying how the milestone was satisfactorily fulfilled (Cover note).
31

b) Copy of the adopted Strategy and a link to the website where it can be accessed.
c) Copy of the publication of the Croatian Hydrogen Strategy until 2050, as adopted by the
Croatian Parliament on 25 March 2022, in the Official Gazette (No. 40/2022).
Analysis:
As set out in the Council Implementing Decision, the Strategy was adopted by the Croatian Parliament
on 25 March 2022 and published in the Official Gazette (No. 40/2022).
The Strategy envisages four strategic directions for the development of a hydrogen-based economy:
hydrogen production (pp. 9 - 11), storage and transport of hydrogen (pp. 11 - 14), hydrogen use (pp.
14 - 19) and education, research and innovation (pp. 19 - 23).
The framework provided by the Strategy is the basis for updating the National Energy and Climate
Plan, based on the Regulation (EU) No 2018/1999 on the Governance of the Energy Union and Climate
Action, which will thus become an action plan for this Strategy (pp. 26 – 27).
The Strategy includes quantified targets on the production potential of renewable hydrogen based
on electrolysis, by 2030 but also up to 2050 (pp. 23 - 26). In terms of production, the Strategy is
focused on renewable hydrogen, and the scenarios and quantification of the targets are based on
climate- neutrality assumptions. The Strategy addresses the potential role of renewable hydrogen in
the decarbonisation of the transport sector (pp. 15 – 17). In relation to the use in road transport, the
Strategy envisages the use of hydrogen primarily for heavy-duty vehicles (e.g., buses and trucks).
The Strategy provides a framework for hydrogen production and use with a focus on renewable and
green hydrogen as a substitute for fossil fuels, as well as for increasing the stability of the renewable
energy source-based electricity system for energy self-sufficiency, clean energy transition and
sustainable mobility.
The Council Implementing Decision states the ’Entry into force of the Hydrogen Strategy for Croatia’
as the qualitative indicator. It has to be taken into account that, in Croatia, strategies are adopted
and do not go into a legislative process that is finalised by entry into force. The strategy cannot enter
into force as it is not a law, but the adoption has the same effect in terms of implementation, meaning
that, by its adoption, the strategy becomes part of the strategic framework under which the public
authorities must make their policy choices and decisions.
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 63 - HR-C[C13]-I[R1-I1] Public sewage development
programme
Name of the target: Public sewerage network constructed or reconstructed
Quantitative indicator: Number of km Baseline: 0
Target: 115 Time: Q2 2022
Context:
The investment aims to achieve renovation and rehabilitation of 775 km of public sewerage
networks; and the construction and putting into operation of 12 wastewater treatment plants, to
ensure access to appropriate wastewater treatment for an additional 12% of the population. The
investment also helps to improve the public sewerage infrastructure, including purchase of
equipment, establishment of control management and geographical information systems and
works supervision.
Number: 63

This target consists of 115 km of constructed or reconstructed public sewerage network. It is the
initial phase of the public sewage development programme measure. Future targets, namely
targets #66 C1.3. R1-I1 (Public sewage network constructed or reconstructed) include at least 775
32

km of public sewerage (drainage) network being built or reconstructed by the end of Q4 2025 and
#67 C1.3. R1-I1 (Population benefitting from improved access to an improved wastewater
treatment system) which aims to reach 200 000 inhabitants benefitting from improved access to an
improved wastewater treatment system, due in Q2 2026.
The next steps also include target #64 C1.3. R1-I1 (Works contracts concluded for wastewater
infrastructure projects) which requires at least 60 signed work contracts for wastewater
infrastructure projects by Q4 2023 and target #65 C1.3. R1-I1 (Wastewater treatment plants
constructed and operational), which requires at least 12 wastewater treatment plants that have
been upgraded or built and are in operation by Q4 2025.
Evidence Provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the target (including all the constitutive elements)
was satisfactorily fulfilled (Cover note).
b) Package of supporting documentary evidence for the 39 project areas. The documentation
contains the following for each of the project areas:
a. The Grant Agreements with their supporting annexes,
b. Technical specifications,
c. Supervising engineer’s report/final report.
c) As an Annex, a detailed overview table on the achievement of the indicator by project.
Analysis:
As required by the Council Implementing Decision, the target requires at least 115 km of public
sewerage (drainage) network built or reconstructed. In addition, the target description requires
that the investment shall ensure compliance with the Urban Wastewater Treatment Directive
(UWWTD) in subject areas, in line with the Multiannual Water and Wastewater Construction
Programme.
At least 115 km of public sewerage (drainage) network built or reconstructed.
The authorities provided evidence that the target of 115 km has been met. Based on the evidence
provided, the target was exceeded, as in total 125.99 km of public sewerage network were built or
reconstructed in 39 project areas. Based on the evidence provided, the amount of built or
reconstructed kilometres per project is verified by the certificate of a supervising engineer and, as
such, marked in column L of the detailed overview table. In column K of the overview table, for each
project, the reference to the supervising engineer certificate (Evidence b and c.) confirming
completion or entry into service is further detailed by document name and concrete page where
the kilometre amount is indicated and confirmed by the supervising engineer.
Built or reconstructed investments shall ensure compliance with the Urban Wastewater
Treatment Directive, in line with the Multiannual Water and Wastewater Construction
Programme.
The Multiannual Water and Wastewater Construction programme (reform C1.3 R1, milestone #59)
provides a long-term investment framework for the development of water and wastewater systems
in Croatia, including methodology for prioritisation of investments. For wastewater investments,
the prioritisation is made based on Article 17 of the Urban Wastewater Treatment Directive,
focusing on mature projects in larger agglomerations (above 2 000 population equivalent, as
defined by the UWWTD Directive).
For constructed or reconstructed sewerage network, the Croatian authorities submitted
documentation in order to demonstrate that each of the 39 project areas have been selected in line
33

with the Directive (evidence earmarked in column G of the annexed overview table) and the
Multiannual Water and Wastewater Construction Programme (evidence earmarked in column D of
the annexed overview table). In order for a project to be approved, each beneficiary had to fill out
an application form, which is annexed to the Grant Agreement and legally binding. In the Grant
Agreements (with the supporting annexes), beneficiaries committed to achieving the requirements
prescribed in the UWWTD and the Council Implementing Decision. Also, the evidence provided links
each project area to the respective wastewater treatment plant to which sewerage networks are
or shall be connected to and notes the appropriate level of treatment of wastewater in line with
the UWWTD (columns M and N, respectively, of the Annexed overview table). All investments are,
therefore, aligned with the investment priorities of the water sector in Croatia and with CID
requirements. Additional investments would take place under target #66 (amounting to at least 775
km of public sewage (drainage) network built or reconstructed by the end of Q4 2025) and target
#67 (amounting to 200 000 inhabitants benefitting from improved access to an improved
wastewater treatment system by the end of Q2 2026).
In line with the investment description in the CID Annex, the cover note, and evidence provided
also show that this investment has been implemented through grants to municipalities, prioritising
projects in line with the requirements of the UWWTD. Concretely, grant agreements (Articles 3 and
9) and application forms (heading 8.4. Planned financing sources) state that financing was provided
jointly with the beneficiary and Croatian Waters. 80% of the total eligible costs have been financed
by the Ministry of Economy and Sustainable Development's budget line for implementing RRP
measures (07705-581), while 20% of the national project co-financing share is provided by Croatian
Waters (10%) and the recipient (10%). Part of the funding was earmarked specifically for the
development of rural areas, where the quality of water service provision is lagging behind the
national average. Such project areas have been earmarked in column F of the detailed overview
table and in respective Grant Agreements.
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 68 - HR-C[C13]-I[R1-I2] Public water supply development
programme
Name of the target: Public water supply network constructed or reconstructed
Quantitative indicator: Number of km
Baseline: 0
Target: 226
Time: Q2 2022
Context:
The investment aims to achieve renovation and rehabilitation of 956 km of public water supply
networks, especially in rural, mountainous, and demographically disadvantaged areas, and
purchase and installation of metering devices on water abstractions, to ensure drinking water and
improved public water supply systems for around 45 000 people. The investment helps reduce
water losses in the public water supply systems.
This target consists of 226 km of constructed or reconstructed public water supply network. It is the
initial phase of the public water supply development programme measure and, as such, contributes
to the achievement of future targets, namely targets #71 and #72 related to C1.3. R1-I2, which
require at least 673 and 956 km of public water supply network constructed or reconstructed, due
by Q4 2023 and Q4 2025 respectively.
Next steps also include targets #69 C1.3. R1-I2 (Water metering devices installed at water
abstraction sites) which plans at least 526 metering devices installed at water abstraction sites by
the end of 2022, #70 C1.3. R1-I2 (Works contracts concluded for water supply projects), which aims
to have at least 100 works contracts for water-based projects signed, due in Q4/ 2023, #73 C1.3.
R1-I2 (Population with improved access to water supply), which aims to improve access to water
supply for at least 45 000 inhabitants by Q2 2026 and #62 C1.3. R1, which aims to reduce water
losses in public water supply systems by 7% at national level by Q2 2026.
Number: 68

34

Evidence Provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the target (including all the constitutive elements)
was satisfactorily fulfilled (Cover note).
b) Package of supporting documentary evidence for the 48 project areas. The documentation
contains the following, for each of the projects:
a. The Grant Agreements with their supporting annexes.
b. Technical specifications and extracts from the Main Design.
c. Supervising engineer’s report/final report.
c) As an Annex, a detailed overview table on the achievement of the indicator by project.
The authorities also provided a package of supporting documentary evidence for a number of
projects for which parts of the water supply network are completely finalised, which includes a
report on performed water impermeability test (pressure test) of the water supply network.
Analysis:
As per the Council Implementing Decision (CID), the target requires at least 226 km of public water
supply network built or reconstructed. In addition, the target description states that the investment
consists in (i) building drinking water supply systems with an average energy consumption of ≤ 0,5
kWh or an Infrastructure Leakage Index (ILI) of ≤ 1,5, and (ii) renovating existing drinking water
supply systems to decrease the average energy consumption by more than 20% or decrease leakage
by more than 20% (efficiency criteria).
At least 226 km of public water supply network constructed or reconstructed.
The authorities provided evidence that the target of 226 km has been met. Based on the evidence
provided, the target was exceeded, as in total 255.53 km of public water supply network were built
or reconstructed in the period from 1 February 2020 until 30 June 2022 in 48 project areas. Based
on the evidence provided, the number of built or reconstructed kilometres per project is verified
by a certificate of supervising engineer and, as such, marked in column T of the detailed overview
table. In column S of the overview table, for each project, a reference to the provided copy of the
supervising engineer’s certificate (Evidence b) and c.) confirming completion or entry into service is
further detailed by the document name and reference to the page where the kilometre amount is
indicated and confirmed by the supervising engineer.
The description of the target additionally makes reference to requirements of the investment as
a whole. Investment HR-C[C13]-I[R1-I2] contains six targets, three of which directly concern this
public water supply network construction or reconstruction. Whilst these requirements apply to
the investment as a whole and will need to be assessed following the completion of the water
supply network under target #72, their application at this stage of the implementation of the
investment has been analysed. These requirements specify that the investment shall consist of
building drinking water supply systems with an average energy consumption of ≤ 0,5 kWh or an
Infrastructure Leakage Index (ILI) of ≤ 1,5, and in renovating existing drinking water supply
systems to decrease the average energy consumption by more than 20% or decrease leakage by
more than 20%.While evidence on the number of kilometres of water supply systems built or
renovated is fully available, it is only partially possible, at the time of the assessment of the target,
to measure and provide complete evidence as concerns the efficiency gains produced by the
investment.

35

The authorities state that pressure test results, which establish that there is no water leakage, are
essential to measure Infrastructure Leakage Index (ILI) and water leakage in general. However, the
authorities confirmed that water pressure tests can only be conducted following completion of the
construction/renovation of a network. Accordingly, compliance with the ILI coefficient and
percentages of energy consumption and water losses reduction can be proven through
measurements only when the water supply systems are completely finalised and in function. This
means when the entire measure is completed and the full length of the new or reconstructed water
supply network is in place. This is not yet the case for many of the pipelines accounted for in this
first target of the Investment R1-I2, as their reference network system includes additional
kilometres to be built/renovated as part of future targets #71 and #72 C1.3. R1-I2, due in Q4 2023
and Q4 2025 respectively.
In addition, as concerns the measurement of reduction in losses brought by renovation, the baseline
for the calculation is not always available, given the pervasive lack of measuring equipment in
Croatia. It should be recalled that to overcome this shortcoming in the Croatian water supply
system, the authorities are installing 526 metering devices at water abstraction sites (a measure to
be completed by the end of 2022 as set in target #69 C1.3. R1-I2).
While water pressure tests cannot be conducted in many cases yet and there is only partial historical
data available, there is nevertheless sufficient reassurance that the energy efficiency criteria in the
target have been fulfilled for the 226 km required by the target, given a combination of elements:
a. The conformity achieved by those pipelines constructed as part of this target under the required
technical standards for which pressure tests have been conducted as the network was already
completed. As evidenced in column L of the annexed overview table, all those pipelines for
which pressure tests have been conducted achieve an efficiency which is in line with the
requirements of the CID. This applies to 29 projects, representing 155,51 km.
b. The clear legal obligation in the project documentation to comply with the CID requirements
and to conduct pressure tests when the conditions are in place. The cover note and submitted
supporting evidence demonstrate that the CID requirements have been included in the project
documentation and are legally binding. In particular, the efficiency criteria are legally binding
for all project areas, as per contractual obligations within Grant agreements, signed with
beneficiaries (Articles 1 and 12). Concretely, Article 12 of every grant agreement confirms that
the application form is legally binding for beneficiaries, while every application form states the
respective main design in heading ’10.3. Project-technical documentation’, and specific pages
in the main design or technical specifications which confirm the obligation to conduct the water
pressure tests are referenced in column I of the annexed table.
c. The estimates made by the authorities about the quality of the pre-existing pipelines
(performing very poorly) replaced/renovated with new pipelines built according to the project
documentation, consistent with the CID requirement. Compliance with the improvement in the
efficiency criteria has been verified on the basis of estimations provided by the authorities,
comparing the situation before the investments with the targeted values to be reached
according to authorities. The authorities explained that out of 48 project areas under this target,
13 areas have detailed data on water losses, while in others water losses have been estimated
(based on the number of defects or breakages, with assessments of the volume of water lost in
that period). For the latter subset, the authorities have stated that the selected projects are
parts of drinking water supply systems which were identified as having the most critical water
losses, as well as other criteria. Concretely, the estimates have been made by the authorities
using the data provided for each of the 48 project areas in the annexed overview table. The
data includes the values of the ILI coefficient or electricity consumption (column K), the
percentages of total water losses or energy consumption values (columns L and N) and the
current annual real losses (column M). The available data indicates that at least 226 km of
36

constructed or reconstructed water supply networks concern water supply systems that have
either (very) high ILI or a (very) high percentages of total water losses. The table allows
comparing the baseline values available or estimated for each project area with the target
efficiency values (ILI coefficient or electricity consumption) for the water supply systems under
construction (column Q of the annexed overview table) and target values for the improvement
in efficiency (target reduction of water loss and energy consumption, column O of the annexed
overview table). On this basis, the authorities provide satisfactory evidence that the efficiency
target values for the pipelines built or renovated under the target are adequate to meet the
improvement in efficiency criteria as prescribed in the CID Annex.
In line with the investment description in the CID Annex, the cover note and evidence provided also
show that this investment has been implemented through grants to municipalities, several of which
are in rural areas. Concretely, grant agreements (Articles 3 and 9) and application forms (heading
8.4. Planned financing sources) state that financing was provided jointly with the beneficiary and
Croatian Waters. 80% of the total eligible costs have been financed by the Ministry of Economy and
Sustainable Development's budget line for implementing RRP measures (07705-581), while 20% of
the national project co-financing share is provided by Croatian Waters (10%) and the recipient
(10%). Part of the funding was earmarked specifically for the development of rural, mountainous
and demographically disadvantaged areas, where the quality of water service provision is lagging
behind the national average. Such project areas have been earmarked in column F of the annexed
overview table.
For the further implementation of this investment beyond this target, the authorities have indicated
in the cover note that they will update and upgrade the information relative to the efficiency of the
investment by the time of the second target (#71) related to this investment, making use of the
newly installed metering stations whenever relevant, and by further collecting information in areas
for which estimates had to be used for this assessment. They confirmed that all measurements will
be conducted in line with standards at EU level and that supporting evidence will be provided until
targets #62 and #72 are met, through a yearly report on conducted measurements of efficiency
requirements set in the CID in relation to those targets.
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 131 - HR-C[C15]-R[R2] Improving the agricultural land
restructuring and consolidation systems.
Name of the milestone: New Act on Agricultural Land Consolidation
Qualitative indicator: Entry into force of the new Act on Agricultural Land
Time: Q1 2022
Consolidation
Context:
The objective of the reform is to facilitate consolidation procedures and continuous monitoring of
agricultural land, which shall create preconditions for applying modern farming methods, for
building infrastructure (such as networks of field roads and melioration channels), and for dealing
with legal relations on agricultural land.
This milestone entails the entry into force of the new Act on Agricultural Land Consolidation, which
will, as a part of the reform, contribute to a more efficient use of agricultural land, increasing
productivity and sustainability of agricultural production with a focus on preserving the
environment and improving life in rural areas.
The next step under this reform is the fulfilment of target #133 which requires the upgrade of the
operational information system for monitoring agricultural land and the establishment of 90
permanent stations to monitor the condition of agricultural land, due in Q2 2025, followed by the
consolidation of 18 000 ha of agricultural land, as required by target #132, due in Q1 2026.
Evidence provided:
Number: 131

37

In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document justifying how the milestone was satisfactorily fulfilled (Cover note).
b) Copy of the publication in the Official Gazette (No. 46/2022) and reference to the relevant
provisions indicating the entry into force of the Act on Agricultural Land Consolidation
including a copy of the text of the Act on Agricultural Land Consolidation.
The authorities also provided:
c) A comparative table of the provisions from the new and from the old Act on Agricultural
Land Consolidation.
Analysis:
As set out in the Council Implementing Decision, the Act on Agricultural Land Consolidation was
published in the Official Gazette No.46/2022 and entered into force on 23 April 2022.
The Act:
1. Introduces conditions for simplifying the consolidation process.
Considering the provisions of the previous Land Consolidation Act the new Act introduces
conditions for simplifying the consolidation process, inter alia, through Articles 1, 5, 17 - 22, 25,
26, 29, 30, 32, 33, 35, 37, 39, 41 - 46, 49, 50.
For example, Article 1 introduces the concept of simple consolidation when administrative and
technical procedures are carried out on a smaller scale. According to Article 5, the Ministry
responsible for agricultural land prepares the Agricultural Land Consolidation Programme
(adopted by the Government), as an act of planning the implementation of land consolidation
on the approximate land area, for the implementation period proposed according to the
available funds. This is instead of the Annual (adopted by the Parliament) and Multi-annual
Programmes (adopted by the Government) that the former Agency for Agricultural Land (AAL)
was obliged to prepare based on the provisions of the previous Land Consolidation Act.
According to Article 6, point 8 and Article 11 para. 2, the consolidation holder (the authority in
charge of initiating and carrying out the consolidation procedure), can be a local government
unit represented by the municipal chief or mayor, the City of Zagreb represented by the mayor,
or the Ministry represented by the minister, while the provisions of the previous Act specified
that the decision on initiating the consolidation procedure had to be issued by the AAL.
Furthermore, according to the former Act, after publication of the final decision on the initiation
of the consolidation procedure, the contract on mutual rights and obligations had to be
concluded between the Agency and the local and the regional government unit, while the
implementation of the consolidation procedure was under the jurisdiction of the County
consolidation commission.
The procedures for complaints at different stages of land consolidation process have been
simplified and deadlines for resolving complaints have been clearly set (Articles 19, 30, 39, 42,
43).
Unlike the previous Land Consolidation Act, the new Act does not provide for the filing of
appeals but provides the possibility to initiate an administrative dispute before the competent
administrative court. In most cases the Act prescribes that the dispute does not delay the
execution of the decision in question.
Furthermore, the number of participating bodies involved in planning and the implementation
of the land consolidation has been reduced, thus ensuring a more streamlined consolidation
process. In particular, the Act prescribes the establishment of one Commission as an expert
body (Article 6, para. 1, item 9), instead of four Commissions, as was the case under the former
Land Consolidation Act procedure.
Additionally, Article 13 provides for the establishment of a Land Consolidation Information
System, with a module for implementing the consolidation procedure and for the purposes of

38

more efficiently implementing consolidation procedures and managing the consolidated land,
as indicated below. This contributes to the overall simplification of the process.
2. Reduces the number of participating bodies involved in planning and implementing the land
consolidation from 17 to 11 bodies, as set out in Articles 5, 9, 11, 17, 19, 21, 25, 27. For example,
the Land Evaluation Commission and Special Assets Commission are no longer participating
bodies in the process.
3. Shortens the time needed to carry out activities in the framework of the allocation.
Article 2 of the Act stipulates that all the procedures carried out for the purposes of
consolidation are considered urgent, which emphasises the importance of the consolidation
and the need to speed-up related processes conducted by the public administration bodies or
courts. Additionally, the overall result of introducing provisions simplifying the consolidation
process and reducing the number of participating bodies participating in the process is the
reduction of the time needed to carry out activities in the framework of the allocation.
4. Applies information technologies and connects to existing and new databases of various
stakeholders, while creating a soil quality database.
The Act establishes the importance of determining the quality of the land (Article 4).
Article 13 prescribes the establishment of a Land Consolidation Information System (LCIS) as an
interoperable multi-platform system linking information systems of individual public bodies for
consolidation purposes (Article 13, para 2).
The LCIS is established for the purposes of planning, implementing, supervising and permanent
monitoring of the condition of the consolidated land (Article 13, para. 1). According to Article
13 para. 4, the LCIS is to contain a module for the implementation of the land consolidation
procedure, for the purpose of simulating the formation of the consolidation blocks and land
allocation. The data used in the module is to be formatted in a way to enable exchange with
other existing land register and cadastre management information systems which are already
in use in Croatia (Article 13 para. 5).
A consolidation register is to be set up within the LCIS (Article 13, para 3) which ensures the
creation and connection of a database on soil quality in accordance with the state of the
agricultural land before and after the consolidation process (Article 13, para 7). Based on the
available data on physical, chemical and biological results of soil analysis and the spatial data
contained in soil samples, it should be possible to determine the soil quality of each cadastral
plot of agricultural land where the analysis was made.
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 138 - HR-C[C15]-R[R4] Improving food donation systems
Number: 138
Name of the milestone: The online platform for food waste prevention and upgraded food
donation IT system
Qualitative indicator: The online platform for food waste prevention and
upgrade of the technical solution for the IT system for food donation are Time: Q2 2022
operational and available to public
Context:
The objective of the reform is to promote the circular economy in the agri-food sector, reduce food
waste and increase food security by improving the food donation system.
The milestone entails launching an online platform on food waste prevention and reduction, to
disseminate best practice, raise awareness and educate about the issue of food waste and food
39

donation. The milestone also entails upgrading the food donation IT system, which is already in
operation with new functionalities, in particular by offering the possibility of regional governance
of the system and statistical representation of data.
It is the first out of two milestones in the implementation of the measure, followed by milestone
#139 which requires the implementation of the support scheme for the infrastructural equipping of
food banks and intermediaries in the food donation chain, due in Q4 2023.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document justifying how the milestone (including all the constituent parts) was
satisfactorily fulfilled (Cover note).
b) Copy of the certificates of work completion signed by the contractor and by the Ministry
of Agriculture, demonstrating that the Online platform for food waste prevention has been
completed and is operational and that the food donation IT system has been upgraded with
new functionalities.
c) Report by the Ministry of Agriculture proving that the online platform for food waste
prevention and the food donation IT system are aligned with the description of the
milestone and the investment in the CID Annex.
d) Links to the online platform and the system.
(https://edoniranjehrane.mps.hr/#/auth/login, https://hrana-nije-otpad.mps.hr/)
The authorities also provided:
e) Login details for the upgraded food donation IT system.
f) Contracts 87/2022/JN for food donation IT system upgrade, and 201/2022/JN for setting up
an online platform for food waste prevention, with project assignments.
Analysis:
The online platform for food waste prevention and reduction was launched to disseminate best
practices, raise awareness, and educate about the issue of food waste and food donation.
The certificate of completion was signed on 1 June 2022 by the contractor and the Ministry of
Agriculture. The modular platform was published under the domain of the Ministry of Agriculture
and consists of a publicly accessible internet portal and an administrative part of the portal for
entering and editing content, which is managed by the officials of the Ministry of Agriculture.
The platform main menu offers several tabs, including Share your knowledge tab and links to the
following pages:
- ’Food Waste Prevention’ page, with subpages on Activities and Implementation, Guidelines
and Instructions, Examples of good practice, Innovations and science, Education (for
children) and Tenders/Funds.
‘Food Donation’ page, providing access to E-donation, Register of intermediaries,
Legislation, Instructions and guides, and Examples of good practice.
‘For consumers’ page, with subpages on Recipes for using food surplus and Useful
information.
Based on the content of the pages and subpages it is concluded that the online platform contributes
to disseminating best practices, raising awareness and educating about the issue of food waste and
food donation, in line with the description of the milestone.
Link: https://hrana-nije-otpad.mps.hr/
The food donation IT system, which was already in operation, has been upgraded with new
functionalities, particularly through the adaptation of the IT system for regional management
(instead of having one central manager for all the counties), and through statistical representation
40

of data for better monitoring. The IT system is available to registered users. The registration can be
done by all subjects in the food business who are interested in donating food through the system,
as well as intermediaries in the food donation chain who are registered with the Ministry of
Agriculture.
The certificate of completion was signed on 27 June 2022 between the contractor and the Ministry
of Agriculture. According to the contract 87/2022/JN, new functionalities were introduced, inter
alia, in the Admin, Donator and Manager/County Manager roles.
More specifically, in the admin role, adding/creating new managers for every county in Croatia has
been enabled. Furthermore, the Reports module, as a new functionality for the admin role, enables
users to review data and prepare reports on donors and intermediaries for a selected time periods.
For example, data on the amount of food donated, number of users in the system, number of
donations made, etc.
An upgrade was also made for the donator role. If a donator creates a new donation, the county to
which they geographically belong is selected as a destination of the food donation by default, but it
is also possible for the donator to choose to send the donation to the manager of another county.
The existing format for entering donation items has been adapted for the donator role, by requiring
the donator to enter the mass or volume of donated food. This allows for an accurate collection of
information, which can ultimately be converted into kilogrammes of food.
New donation management options were introduced for the role of county managers, for example,
forwarding the donation to another county manager and dividing a donation into several parts.
Furthermore, the country manager is now automatically offered a list of three intermediaries to
whom they should offer the donation received. The list is created on the basis of an algorithm with
a combination of three criteria: distance to the intermediary, number of final recipients of the
intermediary and the date of the last donation to the intermediary, as well as two limiting factors:
intermediaries’ food transport and storage options and VAT criteria.
Considering that the already-operational food donation IT system did not contain these
functionalities, it is concluded that the new functionalities constitute an upgrade to the original food
donation IT system.
Link: https://edoniranjehrane.mps.hr/#/auth/login
Implementation of an information and education campaign on food waste prevention and food
donation
Several information and education campaigns on food waste prevention and food donation took
place, as part of the measure and a monitoring indicator for this milestone, as follows:
1. A thematic week dedicated to the prevention of food waste was organised in 2021.
2. An exhibition entitled ‘Food is not a waste, I can influence!’ took place in September 2021,
(Izložba "Hrana nije otpad, i ja mogu utjecati!", 2021. Hrana nije otpad > Novosti (mps.hr).
Furthermore, a cook book with recipes for optimal use of food leftovers (Objavljena
slikovnica Kako su Dora i Mario spasili hranu Hrana nije otpad > Novosti (mps.hr) was
distributed to first graders in all primary schools in the Republic of Croatia. The Minister of
Agriculture visited a primary school in Zagreb and handed out thematic picture books to
first graders, after which an educational workshop ‘Food is precious, not for garbage’ was
held.
The thematic week ended on 5th of October when an expert meeting entitled "Food is not
waste, together to the goal" took place (Ministarstvo poljoprivrede - Održan stručni skup
„Hrana nije otpad, zajedno do cilja“ (gov.hr). The conference gathered all the relevant
stakeholders (authorities, food business operators, academia, scientific community and civil
society organisations) who shared experience and best practice and also discussed possible
solutions for food waste prevention and food donation in Croatia.

41

3. During December 2021, a TV and radio campaign for food waste reduction
(https://www.youtube.com/watch?v=wOMQ8teDXFA) was held to raise awareness about
food waste prevention.
Considering that:
1. the online platform for food waste prevention and reduction was launched with the goal of
spreading best practice, raising awareness and educating people about food waste and food
donation,
2. the food donation IT system has been improved,
3. the authorities have implemented the information and education campaign on food waste
prevention and food donation,
4. it can be concluded that the milestone contributes to promoting the circular economy in
the agri-food sector, reducing food waste and improving the food donation system.
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 160 - HR-C[C21]-R[R2] Strengthening the capacity to prepare
and implement EU projects
Name of the milestone: Upgrading of the eFondovi IT system: Repository system for Audit and
Controls: information for monitoring implementation of RRF
Qualitative indicator: Audit report confirming repository system
Time: Q1 2022
functionalities
Context:
The reform aims to strengthen the capacity of the administration to prepare and implement EU
projects. As part of the reform, the IT system used for European Structural and Investment Funds
(ESIF) must be upgraded to be aligned with the Recovery and Resilience Facility Regulation and allow
for robust monitoring of the plan.
Number: 160

The milestone is covered by the second instalment for non-repayable support. However, it is
examined whether the information provided on this milestone demonstrates that it was satisfactorily
fulfilled at the time of the first payment request. This is because the measure C2.1-R2 stipulates that
the reform must have been completed before the submission of the first payment request. The
milestone consists of the upgrade of the IT system used for European Structural and Investment
Funds (ESIF) that allows for the collection of data and monitoring of the achievement of milestones
as well as collection, storage and access to data as required by Article 22(2)(d)(i) to (iii) of the
Recovery and Resilience Facility Regulation.
This milestone is the only one relating to this measure.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document/Cover note duly justifying how the milestone (including all constitutive
elements) was satisfactory fulfilled.
b) Final audit report of the IT system as carried out by the national Audit Authority (ARPA),
confirming the functionalities of the repository system (full report).
c) Follow-up report from the national audit authority confirming that the updates relating to
the safety and security risks were put in operation.
Other evidence:
d) Summary of audits as submitted by the authorities with the second payment request.

42

Analysis:
As set out in the Council Implementing Decision, the Audit report confirming repository system
functionalities has been completed. The repository system is an upgrade to the existing eFondovi IT
system, already used for European Structural and Investment Funds (ESIF) monitoring, with the
relevant functionalities to ensure collection, storage, monitoring and sharing of data on the
implementation of the Recovery and Resilience Plan, including at the level of final recipients.
The requirements to ensure collection, storage, monitoring and sharing of data on the
implementation of the Recovery and Resilience Plan, including at the level of final recipients,
stemming from the Recovery and Resilience Facility Regulation, were included in the existing as well
as newly developed modules of the eFondovi IT system. The upgrades to enable the functionalities
listed above were done in the second half of 2021 and first months of 2022 and include both updates
of existing modules of the system as well as additional, newly developed modules such as the module
dedicated to storage and monitoring of data on milestones and targets. These upgrades provide for
a thorough monitoring of the achievement of milestones and targets and data at the level of final
recipients through a newly developed, dedicated module in the eFondovi IT system, as well as data
aggregated at higher levels.
The authorities ensured that all required data are in the system and that the accesses related to the
first payment claim are provided. The audit report confirmed, on p. 7, that the IT system:
 allows data to be collected and the achievement of milestones and targets to be monitored,
 allows for the collection and storage of the information required under Article 22(2)(d)(i) to
(iii) of the Recovery and Resilience Facility Regulation, and that access to this data, by the
Commission, is ensured. This entails that the relevant bodies were granted access and
entered all the relevant information to monitor the progress related to the milestones and
targets relevant for the first payment request.
The dedicated audit report of the IT system reported several findings related to potential security
risks and deficiencies in the operation of the system. The Commission required the authorities to
address these findings – which were qualified as urgent by the National Audit Authority - and to
provide updates to the system by 8 April 2022. On 7 April 2022, the national audit authority
confirmed that the updates relating to the safety and security risks had been carried out.
It can therefore be considered that the IT repository system is in place and operational. It provides
for robust and adequate monitoring of the management and implementation of the Plan, and
collects, stores and ensures access to the data in accordance with article 22(2), point (d) of the
Recovery and Resilience Facility Regulation.
As set out in the Council implementing decision, the information provided on this milestone, clearly
indicates that the reform had been completed and the milestone satisfactory fulfilled at the time of
the submission of the first payment request on 15 March 2022.
Over the course of July and August 2022 the authorities implemented additional functionalities of
the system that go beyond the requirements set out in the milestone. These include a direct link with
the Registry of beneficial owners, granting access rights to further bodies involved in the
management and implementation, the input into the system of the data on retroactive projects (all
data relevant to the first and second payment requests has been included), and extra functionalities
(further development of modules for reporting, selection, and preparation of calls). The Summary of
audits submitted with the second payment request confirmed (on pp. 20 and 21) the implementation
of these additional functionalities.
Commission Preliminary Assessment: Satisfactorily fulfilled

43

Related Measure: 174 - HR-C[C22]-R[R4] Functional and sustainable local
government
Name of the milestone: Amendment of the legislative frameworks to encourage the voluntary
functional or actual merger of the local government units (LGUs) and adoption of a Decision of the
Croatian Government on the criteria for granting fiscal incentives for voluntary functional or actual
mergers
Qualitative indicator: Entry into force of the legislative framework
Time: Q1 2022
Context:
The reform under the component Functional and sustainable local government, aims to establish a
high quality and efficient system of local and regional government through incentivising both the
functional and actual integration of local government units. The reform is expected to contribute to
the improved, efficient and transparent provision of public services, providing them with equal
opportunities to meet their needs and interests, regardless of their place of residence.
Number: 174

The milestone itself requires the entry into force of the amendments to the legislative framework to
encourage the voluntary functional or actual merger of the local government units (LGUs) and
adoption of a Decision of the Croatian Government on the criteria for granting fiscal incentives for
voluntary functional or actual mergers.
This milestone is the first step in the implementation of the measure, and it is complemented by
milestone #175, C2.2.R4-I1, concerning the putting in place of a support mechanism for voluntary
functional and real connections and the establishment of a complete support system for functional
and effective coupling of units, due in Q2 2025.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Copy of the publication of the Act on Execution of 2022 State Budget of the Republic of
Croatia in the Official Gazette and link to the publication: Official Gazette (No. 62/2022, 2
June 2022), Article 68 (indicating the entry into force on 3 June 2022) and Article 30
(indicating that the state budget includes amounts to incentivise mergers and that the
subsequent Decisions on the incentives would be adopted - see point 2 below)
b) State budget for 2022 and projections for 2023 and 2024: Official Gazette (No 62/2022, 2
June 2022), Section III. Article 4 indicating the entry into force on the first day after
publication in the Official Gazette, on 3 June 2022, on p. 40, indicating that HRK 100.000.000
have been allocated for incentives to stimulate voluntary functional and actual mergers
c) Copy of the publication of the government’s decision on the criteria for granting fiscal
incentives for the voluntary functional or actual merger of local government units and link
to the publication: Official Gazette (No. 88/2022, 29 July 2022), Article XIII indicating the
entry into force on the first day after publication in the Official Gazette, on 30 July 2022 –
providing the legal basis for incentives to stimulate actual and functional mergers of the local
government units.
d) Report (summary document) explaining amendments that were made to the legislative
framework, including description of the financial support mechanism put in place to
encourage both functional and effective mergers of the local government units.
e) Copy and link to the public invitation to the local government units for expression of
interest in the voluntary functional or actual merger published on the official website
(Number 513-05-06-22-1 of 8 September 2022, link included in the Cover note, p. 1) :

44

f)

Calculation methodology for functional or actual mergers, pp. 1-2 showing how the amounts
allocated in the state budget were determined and how they would be sufficient to
incentivise the required share of mergers.
g) Cover note, summarising how the milestone requirements were met.
Analysis:
As set out in the Council Implementing Decision, the legislative framework and the financial support
mechanism were designed and put in force.
1. The Act on Execution of 2022 State Budget of the Republic of Croatia was adopted on 27 May
2022 by the Croatian Parliament, published in the Official Gazette on 2 June 2022 and entered
into force on 3 June 2022. Article 30 of the Act provides for the establishment of a financial
support mechanism to incentivise both functional and actual mergers of the local government
units in line with the CID description. Concretely, Article 30 of the Act ensures that sufficient
resources have been allocated in the State budget, under heading 025 falling under the Ministry
of finance, to financially encourage the actual merger of at least 20% of the local government
units, and a functional merger of at least 40% of the local government units in accordance with
the CID. On p. 40 of the State budget for 2022 and projections for 2023 and 2024 in the Official
Gazette (No 62/2022, 2 June 2022), HRK 100 million (EUR 13.3 million) has been provided as
incentives for the voluntary functional and actual mergers of local government units. The
authorities also provided the calculations, which confirm that the allocated amount is sufficient
to achieve the above percentage targets, in the form of an additional document (Calculation
methodology for functional and real mergers).
2. Pursuant to Article 30 of the Act on the Execution of the State Budget of the Republic of Croatia
for 2022 Official Gazette (No 62/2022, 2 June 2022), the government of the Republic of Croatia
adopted a Decision on the criteria for granting fiscal incentives for the voluntary functional or
actual merger of local government (Official Gazette, No. 88/2022, 29 July 2022), which lays
down the provisions for allocating incentives to stimulate local government units’ mergers,
differentiating between different types of mergers with higher incentives available for actual
mergers (Articles III to IX of the Decision).
3. Article VIII of the Decision on the criteria for granting fiscal incentives for the voluntary functional
or actual mergers of local government (Official Gazette, No. 88/2022, 29 July 2022) indicates that
the functionally merged units must retain the same budget resources available to them prior
to the merger, for a minimum period of two years. Article IV, VII and IX of the Decision on the
criteria for granting fiscal incentives for the voluntary functional or actual mergers of local selfgovernment (Official Gazette, No. 88/2022, 29 July 2022) prescribe the formulas for allocating
additional resources and blending costs, including maximum ceilings, in line with the CID
provisions calling for the incentives to also cover one-off blending costs and shall provide
additional resources based on the savings achieved over the next five years.
4. Article IX of the Decision on the criteria for granting fiscal incentives for the voluntary functional
or actual merger of local government (Official Gazette, No. 88/2022, 29 July 2022) stipulates that
the incentives for real local government units' mergers include one-off capital transfers over
five years. As indicated in the cover note, these amounts can only be used for infrastructure
projects, which is confirmed also by the fact that according to the budgetary classification in
Croatia, capital transfers can only be used for infrastructure projects.
5. The Decision on the criteria for granting fiscal incentives for the voluntary functional or actual
merger of local government (Official Gazette, No. 88/2022, 29 July 2022), indicates that different
levels of incentives would be allocated depending on the type of merger. Greater fiscal
incentives are envisaged for actual mergers (Article IX), while the incentives for functional
45

mergers depend on the number and type of functions merged. Specifically, the Decision
distinguishes between mergers of administrative functions, and a second type of functional
mergers, which relate to mergers of other functions, such as utility companies, waste
management companies, kindergartens, local tourist boards etc. For those kind of mergers,
different incentives are prescribed than for the mergers of the administrative functions.
6. The Cover note includes a link to the public invitation (Number 513-05-06-22-1 of 8 September
2022), a permanently open public call, to local government units for expression of interest in the
voluntary functional or actual merger, as also required in Article XII of the Decision on the criteria
for granting fiscal incentives for the voluntary functional or actual merger of local government
units (Official Gazette, No. 88/2022, 29 July 2022). This call is the operational part of the reform,
providing the possibility for the local government units to submit applications for receiving
incentives, with a view to undergo either a functional or actual merger.
It is considered that the amendments made to the legislative framework and outlined above
contribute significantly to the overall reform process of the systemic organisation of local
government in Croatia. The structure for incentives sets out different levels of incentives both for
different types of mergers and for different sizes of local government units merging, with levels of
incentives for functional mergers set based on the types of functions to be merged as well as the
population of the local units merging, providing higher incentives to local units with smaller
population. These incentives aim to improve the quality and efficiency of services provided to the
public, while also ensuring long-term savings for the national and local budgets.
Commission Preliminary Assessment: Satisfactorily fulfilled

Number: 202

Related Measure: 202 - HR-C[C23]-R[R4] Strengthening connectivity as a
cornerstone of the digital transition of society and the economy

Name of the milestone: Optimisation of the permit granting process for connectivity investments
Qualitative indicator: Entry into force of a revised legal framework

Time: Q2 2022

Context: The measure aims to further develop the availability of electronic (fixed, wireless, and
mobile) communications networks, including 5G networks, to the households and socio-economic
drivers in Croatia, in line with the objectives of the European Gigabit Society.
Through this milestone, three legal acts are adopted and have entered into force, providing
adequate conditions for the development of high-capacity networks, and addressing the
administrative burden and regulatory barriers hampering the construction, including streamlining
the licensing/authorisation process, as well as introducing a simplified and transparent presentation
of the electronic communication infrastructure in spatial plans.
The entry into force of the legal acts should help the implementation of the two RRP connectivity
targets by June 2026 (RRP targets 204 and 206): the access of 80% of the Croatian population to 5G,
and the broadband access for 486 000 households living in white Next Generation Access (NGA)
areas. This milestone is the only one under this reform.
Evidence provided: In line with the verification mechanism set out in the Operational
Arrangements, the following evidence was provided:
a) Summary document duly justifying how the target (including all the constitutive elements) was
satisfactorily fulfilled (Cover note).
b) The Electronic Communications Act (referred to below as “Act”), transposing Directive (EU)
2018/1972 establishing the European Electronic Communications Code. It includes provisions
aimed at encouraging investment and further development of connectivity and high-speed
46

electronic communications networks and creating preconditions for the introduction and
development of 5G networks.
c) The amended Decree on determination of buildings, other interventions in space and areas
of national and regional significance (referred to below as “Decree”) determines the national
importance of confirms the competence of national authorities of the entire electronic
communications infrastructure and associated equipment, therefore empowering the
jurisdiction of state-level bodies in the issuance of building permits and other acts, instead of
local-level bodies. It is meant to reduce unnecessary barriers and prevent obstructions and
delays in the construction.
d) The amended Ordinance on simple and other buildings and works (referred to below as
“Ordinance”) further regulates the construction of the electronic communications
infrastructure and other related equipment. It prescribes the inclusion of these infrastructures
in the spatial planning corridors of infrastructure buildings and the building plots of existing
infrastructure buildings and optimizes the licensing process by reducing the number of
procedures.
Analysis
Streamlined legal, administrative and frame conditions for the development of high-capacity
networks are set out in the Act (see reference to relevant articles below):
1. The National Regulatory Authority (HAKOM) identifies and addresses obstacles affecting the
development of broadband investments (Article 19 of the Act), provides assistance to public
authorities and businesses in the planning/implementation/monitoring of projects, coordinates
the public action, assists in/monitors/reports (on) the execution of the National Broadband
Plan. It adopts with the consent of the relevant Ministry(ies) the Ordinances prescribing the
conditions for spatial planning and construction (Art. 55) p.35).
2. HAKOM collects and makes available detailed information regarding the geographical mapping
of electronic communications networks to the authorities, the operators and citizens, for
transparency purposes and to promote investment („geographical review“, Art. 58 of the Act).
The mapping covers a maximum period of 3 years; operators and public authorities are required
to inform whether they intend to deploy very High-Speed Communication networks (VHCN) or
significantly improve/expand their network to achieve at least 100 Mbps.
3. HAKOM maintains and publishes a database on submitted statements of commercial interest in
the construction of broadband networks, ensures that the project is developed as per the initial
commitment and in line with the state-aid provisions (Art. 60of the Act. In case of public funding
support, HAKOM consider the results of a geographical survey of the availability of broadband
network; the expressions of market interest are provided when a sponsor announces its
intention or conducts a public consultation procedure on granting state aid, in line with the EU
broadband state-aid guidelines (2013/C 25/01).
4. The non-discriminatory access to physical infrastructure inside the building should be ensured
(Art. 55 of the Act)). All newly built building has access point and physical infrastructure for highspeed network (Art. 56-57 of the Act). The building investor constructs the high-speed
electronic communications network up to the building plot, as well as an access point and
physical infrastructure within the building. The operators build the network to an access point
at their own expense. The landlord or other right holders have access to the network on fair
and non-discriminatory terms. The provisions also apply to older buildings in which connections
are introduced upon request and in agreement with the tenants. The public owner should
respect the non-discrimination principle when giving access to its property. An agreement on
property issues with the operator should be reached in 60 days from the access request. The
Right of Way fee (RoW) represents the only fee due by the operator; it is calculated in a
47

proportionate way of the costs borne by the property owner and the operator (Art 61-66 of the
Act).
5. The technical, operational and other conditions for certain types of electronic communications
networks and infrastructure are set-out in the Act (Art. 55 of the Act), while details prescriptions
are elaborated by HAKOM. Specifically, the deployment and operation of small-area wireless
access points (SAWAP) is facilitated (Art. 88 of the Act). It is not conditioned by any construction,
urban or other prior permit, except in exceptional cases. The required physical and technical
characteristics of SAWAP points are determined by the implementing regulations of the
Commission on State-aid. HAKOM and other competent authorities ensure that operators have
access to public physical infrastructure for installation and can connect wireless access points
to the core network. The amount of the fee for setting up a SAWAP cannot exceed the
administrative cost for processing the request for its installation; no fee is requested for
buildings or premises owned or operated by public authorities.
Simplified & transparent presentation of the electronic communication infrastructure in spatial
plans:
Article 59 of the Act sets out the obligation to plan an electronic communication infrastructure and
related facilities in spatial planning documents. These are the spatial plans of local and regional selfgovernment units, which have not always favoured and supported the development of new
technologies. Therefore, a set of measures haven been taken:
1. The Ministry in charge ensures that HAKOM provides a preliminary opinion on the final spatial
plan proposal; it can suspend the application of the spatial plan or any other act from the local
authority, which is contrary to it, and challenge the suspended act before the High
Administrative Court4 (Art. 59 of the Act);
2. A project can be developed in contradiction to the current (regional and local) spatial plan for
works on the existing construction of electronic communications infrastructure, if it is meant to
maintain or replace existing equipment (new equipment and/or new technology) (Art. 1.4of the
Ordinance);
3. Provisions of spatial plans that do not allow the construction of new and replacement of existing
equipment according to the "Uniform plan on mobile communications operator" and which are
not in accordance with the regulations in the field of electronic communications become
irrelevant (Ordinance, Art 1.5 of the Ordinance);
4. Electronic communication infrastructure and associated equipment, control measuring stations
with a control-measuring system of passive antennas intended for protection and control
spectrum can be built in accordance with regulations in the field of electronic communication
infrastructure, in the spatial planning corridors of infrastructure buildings and within the
building plots of existing infrastructure buildings (Art 1.5 of the Ordinance).
Streamlined licensing/authorisation process
1. The revised Decree (Art. 2.1 and 4.1 of the Decree) establishes the national competence over
the entire electronic communication infrastructure and associated equipment, empowering
state-level authorities (instead of local-level authorities) in the issuance of building permits and
other acts, which should contribute to a more traceable and efficient procedure.

4

The Court confirmed recently the irregularity of decisions banning the 5G technology by local authorities, see
cases 63/21 https://narodne-novine.nn.hr/clanci/sluzbeni/2022_05_58_857.html ; 58/21 https://narodnenovine.nn.hr/clanci/sluzbeni/full/2022_05_58_856.html

48

2. The revised Ordinance reduces the number of existing procedures for the issuance of the
relevant licences; it includes new provisions determining in which cases a building permit is (no
longer) necessary (Art. 3.12-16 of the Ordinance).
Commission Preliminary Assessment: Satisfactorily fulfilled

Number: 214

Related Measure: 214 - HR-C[C25]-R[R1] Increasing the efficiency of the justice
system to increase citizens’ trust

Name of the milestone:
Electronic tools provided and adequate administrative capacities for
the State Judicial Council (Državno sudbeno vijeće, DSV) and the State Attorney's Council
(Državnoodvjetničko vijeće, DOV).
Qualitative indicator: Electronic tools and adequate administrative
capacities provided for the State Judicial Council (Državno sudbeno vijeće,
Time: Q1 2022
DSV) and the State Attorney's Council (Državnoodvjetničko vijeće, DOV)
Context:
The objective of the reform is to establish a legal, organisational and technological framework that
will contribute to reducing backlogs and shortening court proceedings, focusing on transparent and
efficient administration of the justice system.
The milestone requires the implementation of measures to improve the quality of the work done
by the State Judicial Council (Državno sudbeno vijeće, DSV) and the State Attorney's Council
(Državnoodvjetničko vijeće, DOV), by requiring electronic tools and adequate administrative
capacities for both Councils to be operational.
This milestone is the first of a set of milestones (milestones #214, #215 and #216) and represents
the initial step for completing reform C2.5.R1 ‘Increasing the efficiency of the justice system to
increase citizens’ trust’. The reform also includes other milestones (milestones #217 to #233), with
indicative time of completion at Q2 2026.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document justifying how the milestone was satisfactorily fulfilled (Cover note).
b) Detailed list of the new equipment and the location where it was installed or distributed:
1. Confirmation of 4 computers delivered to the State Attorney’s Council (DOV).
2. Confirmation of 4 computers delivered to the State Judicial Council (DSV).
3. Detailed list of the new equipment and description of the IKS Application (the property card
system of judicial officials' application (‘Sustav imovinskih kartica pravosudnih dužnosnika’).
c) Anonymised personnel records demonstrating the human resource increase:
4. Decision of the President of the State Attorney’s Council (DOV) on admission of a civil
servant into the state administration.
5. Decision of the President of the State Attorney’s Council (DOV) on assignment of a civil
servant to the workplace.
6. Bilateral Agreement and Decision on temporary transfer of a civil servant to the State
Attorney’s Council (DOV).
7. Public tender for one civil servant from 9 February 2022 State Attorney's Council (DOV).
8. Public tender for one civil servant from 4 March 2022 State Attorney's Council (DOV).
9. Decision of the President of the State Attorney’s Council (DOV) on suspending the public
tender for one civil servant from 2 March 2022 State Attorney's Council (DOV).

49

10. Decision of the President of the State Attorney’s Council (DOV) on suspending the public
tender for one civil servant from 24 March 2022 State Attorney's Council (DOV).
11 Order of Ministry of Justice and Public Administration on temporary transfers of two civil
servants to State Judicial Council (DSV) from May 2022.
12 Public tender for two civil servants from 6 May 2022 State Judicial Council (DSV).
13. Public tender for one civil servant from 13 April 2022 State Attorney’s Council (DOV).
14. Decision of the President of the State Attorney’s Council (DOV) on suspending the public
tender for one civil servant from 2 May 2022.
15. Decision of the President of the State Judicial Council (DSV) on admission of one civil
servant to the state administration from 21 June 2022.
16. Decision of the President of the State Judicial Council (DSV) on assignment of one civil
servant to the workplace from 16 August 2022.
17. Decision of the President of the State Judicial Council (DSV) on suspending the public
tender for one civil servant from May 2022.
18. Public tender for one civil servant from 18 July 2022- State Attorney's Council (DOV).
19. Decision of the President of the State Attorney’s Council (DOV) on suspending the public
tender for one civil servant from 30 August 2022.
20. Order of Ministry of Justice and Public Administration on temporary transfer of one civil
servant to State Attorney’s Council (DOV) from September 2022.
21. Order of Ministry of Justice and Public Administration on temporary transfers of two civil
servants to State Judicial Council (DSV).
d) Proof of the linking of the DSV and the DOV to the common land registry and cadastre (ZIS)
and tax administration information system and establishment of an effective mechanism for
verifying the asset declarations of state officials:
22. Requirements of State Attorney's Council (DOV) for merging with relevant registers through
the Government Service Bus (GSB).
23. Requirements of State Judicial Council (DSV) for merging with relevant registers through the
GSB.
24. Consent from the Central State Office for the Development of the Digital Society (HR:
Središnji državni ured za razvoj digitalnog društva – SDURDD) to the State Attorney's Council
(DOV) for merging with 10 registers.
25. Consent from the SDURDD to the State Judicial Council (DSV) for merging with 10 registers.
26. Consent from the SDURDD to the State Attorney's Council (DOV) for merging with Tax
Administration Information System (register of personal identification number (OIB) and
register of incomes and receipts, EDIP) and FINA web services (WS) (Single Register of Bank
Accounts - JRR).
27. Consent from the SDURDD to the State Judicial Council (DSV) for merging with Tax
administration information system (OIB, EDIP) and WS FINA web services (WS) (Single Register
of Bank Accounts -JRR).
28. Agreement on cooperation between the Ministry of Justice and Public Administration
(MJPA), Central Clearing Deposit Company and the contractor Ultima d.o.o.
29. Data Processing Agreement (DPA) between the Councils, MJPA and Central Clearing Deposit
Company.
30. Final Completion Report from the State Judicial Council (DSV).
31. Final Completion Report from the State Attorney's Council (DOV).
e) Certificate of completion from the contractor
32. Certificate of completion of contract No. 59/21 from the contractor Ultima d.o.o.
33. Report by Ultima d.o.o. on realized production connections made (update).
34. Screen image of IKS application with listed registers and retrieval dates.
Analysis:
50

As required by the Council Implementing Decision, by 31 March 2022 electronic tools and adequate
administrative capacities were in operation for the State Judicial Council (Državno sudbeno vijeće,
DSV) and the State Attorney's Council (Državnoodvjetničko vijeće, DOV), to improve the quality of
the work by both Councils. Their staffing levels were increased by 50% compared to the 2021
baseline (by recruiting 4 persons) and the DSV and the DOV have been linked to the common land
registry and cadastre (ZIS) and tax administration information system to establish an effective
mechanism for verifying asset declarations by state officials.
Adequate administrative capacity
Regarding adequate administrative capacities, the two Councils were provided with four
additional civil servants who deal with the verification of data from asset declarations. The
recruitment of 4 persons represents an increase by 50% compared to 2021 baseline, when the
number of employees was 8 (5 in the State Judicial Council and 3 in the State Attorney’s Council).
In May 2021 two permanently employed civil servants were transferred from the Ministry of Justice
and Public Administration (MJPA) to the State Judicial Council (DSV) to handler the verification of
data from asset declarations (evidence 11). The transfers are extended until permanent officials can
be employed through a public tender. After the expiration of the first transfer of civil servants, the
decisions on the transfers were extended for an additional year until 2 May 2022 (evidence point
21). In May 2022, the State Judicial Council (DSV) announced a public tender for employing 2 civil
servants on a permanent base for dealing with the asset declarations (evidence point 12). One
person was employed on a permanent basis (evidence 15 and 16). The second position continues
to be filled by a permanently employed civil servant transferred from the MJPA to the State Judicial
Council (DSV) until 2 May 2022 (evidence point 21).
In December 2021 the State Attorney’s Council (DOV) employed one civil servant on a permanent
basis by conducting a public tender (evidence 4 and 5). The second position is filled by a
permanently employed civil servant transferred from the MJPA until March 2023. Following four
unsuccessful public tenders (evidence points 7, 8, 13, 18), since no applications were received, or
the applicant(s) did not meet the job requirements (evidence points 9, 10, 14, 19), in March 2022
one person was temporarily transferred from the MJPA to the State Attorney’s Council (DOV)
(evidence point 6). After expiring in September, the transfer of the civil servant from the MJPA was
extended until March 2023 (evidence point 20).
Electronic tools: Linking the DSV and the DOV to the common land registry and cadastre (ZIS) and
tax administration information system and establishing an effective mechanism for the
verification of asset declarations of state officials
In January 2021, the asset declarations of judges and state attorneys were published online and
became publicly available. Since then, the State Judicial Council (DSV) and the State Attorney’s
Council (DOV) have taken steps to enable access and secure connections of their ICT systems with
the databases of the relevant authorities, to ensure effective and quick verification of asset
declarations. Both Councils first started the process of concluding bilateral agreements on sharing
data with each institution (e.g. the Tax Administration, Financial Agency FINA, Ministry of
Transport, Ministry of Agriculture, Land Registry, Cadastre, etc.) to gain access to their databases.
In parallel, the Central State Office for the Development of the Digital Society (HR: Središnji državni
ured za razvoj digitalnog društva - SDURDD) developed the Government Service Bus (GSB) as a
central system for secure exchange of data between public bodies. According to the Law on
Information Infrastructure (OG 92/14), all public bodies are obliged to connect their information
systems (public registers) to central systems of interoperability through GSB. Thus, the Councils
decided to start a procedure of merging the property card system of judicial officials' application
51

(‘Sustav imovinskih kartica pravosudnih dužnosnika’ also referred to as the ‘IKS Application’) with
the web services of other relevant public bodies through the GSB.
For the technical upgrading of the IKS Application to merge with other applications and registers of
the relevant bodies through the GSB, the Ministry of Justice and Public Administration (MJPA) as
the owner of the IKS application, together with the State Judicial Council (DSV) and State Attorney’s
Council (DOV) as users of the application, engaged an IT company Ultima d.o.o. as a contractor to
provide the requested services related to the upgrades and merger. They also signed an agreement
for the provision of these services (Contract No. 59/21 on services for upgrading the application
system for electronic management of asset cards of judicial officials IKS functional module for
connection with applications and registers of MJPA and applications and registers of other
institutions).
In February/March 2022 the SDURDD gave its final consent for connecting the live IKS Application
with the following registers (evidence 8, 9, 10, 11):
1. Ministry of Interior - Vehicle Register
2. Ministry of Interior - Register of (habitual) Residence
3. Access to Land Register and Cadaster System
4. Ministry of Justice and Public Administration - Register of Births, Marriages and Deaths,
Register of Partnerships, Register of Citizenship
5. Commercial Court Register
6. Ministry of Economy and Sustainable Development - Trade Register
7. Financial Agency - Register of (court and notary public) secured claims on movables and
rights
8. Paying Agency for Agriculture, Fisheries and Rural Development - access to Register of
Family Farms
9. Ministry of Transport and Infrastructure - Register of Vessels Owners
10. Croatian Civil Aviation Agency - Register of Aircraft Owners
11. Tax Administration Office - access to personal identification number (OIB)
12. Financial Agency - Single Register of Bank Accounts (JRR)
13. Tax Administration Office - access to Register of Incomes (EDIP)
After the final consent from the SDURDD was given, the IKS Application was connected with all the
above-mentioned registers and is ready/functional for verifying the asset declarations of judicial
officials. Consequently, as required by the Council Implementing Decision, the State Judicial Council
and the State Attorney’s Council were linked, among other registers listed above to the common
land registry and cadastre (ZIS) and the tax administration information system, and an effective
mechanism for verifying the asset declarations of state officials is now established. The tax
administration information system includes the register of personal identification number (OIB) and
a register of incomes and receipts (EDIP).
Since the Central Clearing Deposit Company, which is responsible for the Register of owners of
securities (dividends, stocks) is not on the GSB (not being a public body), an Agreement on
cooperation between the two Councils, the MJPA and Central Clearing Deposit Company was signed
in February 2022 (evidence point 28).
After signing the Agreement, the relevant data were exchanged, and the work in production
environment started, the property card system of the judicial officials' application (IKS Application)
was connected with the Central Clearing Deposit Company registers and is ready/functional for
verifying the asset declarations of judicial officials with respect to records of stock shares and
dividends.
A screen image of the IKS application also shows all connected registers and retrieval dates
(evidence point 34). The upgrades to the electronic tools, new equipment and the increase in staff
described above have all improved the quality of work by both Councils, which are now able to
52

effectively analyse and verify information from the common land registry and cadastre (ZIS), tax
administration information and other systems for verifying the asset declarations of state officials.
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 215 - HR-C[C25]-R[R1] Increasing the efficiency of the justice
system to increase citizens’ trust
Name of the milestone: Amendments adopted to the Bankruptcy Act and the Consumer
Insolvency Act
Qualitative indicator: Entry into force of the Bankruptcy Act and the
Time: Q2 2022
Consumer Bankruptcy Act
Context:
The objective of the reform is to establish a legal, organisational, and technological framework that
will contribute to reducing backlogs and shortening court proceedings and focusing on the
transparent and efficient administration of the justice system.
The milestone entails the entry into force of amendments to the Bankruptcy Act and the Consumer
Insolvency Act to (i) ensure greater efficiency of insolvency proceedings and (ii) improve the system
of organisation and appointment of insolvency practitioners and the supervision of the
performance of the service. The purpose of the milestone is to act as a deterrent against a potential
increase in the number of cases due to the conditions of the COVID-19 pandemic and to amend
Article 212 of the Bankruptcy Act relating to avoidance proceedings.
This milestone together with milestones #214 and #216 are part of the second payment request
and represent the initial steps for completing reform C2.5.R1: Increasing the efficiency of the justice
system to increase citizens’ trust. The reform also includes other milestones (milestones #217 to
#233), which have to be completed after 2022 and before Q2 2026.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the milestone was satisfactorily fulfilled (Cover
note).
b) Copy of the adopted amendments to the Bankruptcy Act and amendments to the
Consumer Insolvency Act and link to the Official Gazette website (No. 36/2022) where
these can be viewed:
https://narodne-novine.nn.hr/clanci/sluzbeni/2022_03_36_431.html
Number: 215

https://narodne-novine.nn.hr/clanci/sluzbeni/2022_03_36_432.html
Analysis:
As required by the Council Implementing Decision, the amendments to the Bankruptcy Act and the
Consumer Insolvency Act were adopted by the Croatian Parliament on 11 March 2022 and both
entered into force on 31 March 2022, in accordance with Article 117 of the Amendments to the
Bankruptcy Act and Article 13 of the Amendments to the Consumer Bankruptcy Act. They contain
the following provisions:
The acts (both published in the Official Gazette, No. 36/2022) were amended to ensure greater
efficiency of insolvency proceedings, improve the system of organisation and appointment of
insolvency practitioners and supervision of the performance of the service, implement Directive
(EU) 2019/1023 and act as a deterrent against a potential increase in the number of cases due to
the conditions of the COVID-19 pandemic and amend Article 212 of the Bankruptcy Act relating to
avoidance proceedings.
1. Ensuring greater efficiency of insolvency proceedings

53

To increase the efficiency of insolvency proceedings, the amendments to the Consumer Insolvency
Act introduce provisions (Article 58, paragraph 2 of the Consumer Insolvency Act - via Article 8 of
the Amendments to the Act) and Article 69, paragraphs 1 and 2 of the Consumer Insolvency Act –
via Article 9 of the Amendments to the Act).
These provisions ensure that the shortened period (3 years instead of 5 years) of consumer
behaviour testing after which insolvent consumers can be fully discharged from their debts is
applicable also to consumer insolvency proceedings which were initiated before the amendments
enter into force - but only if the decision of the court was still not reached by the time of the
amendments entered into force (this exception is regulated by Article 12 of the Amendments to the
Act).
With that change, the applicability of the Act is broadened, since it was originally planned to apply
only to the consumer insolvency proceedings which were initiated after the amendments entered
into force. This amendment therefore allows more consumers to benefit from this debt discharge.
Article 69, paragraph 2, item 3 of the Consumer Insolvency Act stipulates that the consumer will be
denied the right to be released from remaining obligations if in the last 6 years (instead of 10 years,
as previously) preceding the filing of a proposal to that affect (that is, in the last 3 years (instead of
5 years, as previously) preceding the submission of a proposal to open a simple consumer
bankruptcy procedure), they were released from remaining obligations or were denied the
exemption.
In accordance with Article 7.a of the Bankruptcy Act (Article 4 of the Amendments to the Act) early
warning tools have been introduced to signal promptly to entrepreneurs experiencing financial
difficulties, what action is needed to avoid bankruptcy and to be able to start restructuring troubled
businesses in a timely manner.
With the amended Article 24 of the Bankruptcy Act (Article 11 of Amendments to the Act), during
the pre-bankruptcy procedure, the trustee is now obliged to provide assistance to the debtor in
drawing up or negotiating a restructuring plan, which reduces the time and improves the efficiency
of the pre-bankruptcy procedure.
Article 373 of the Bankruptcy Act (Article 93 of the Amendments to the Act) stipulates that the
proposal for release from the remaining obligations may be submitted by the debtor together with
the proposal for the opening of bankruptcy proceedings, which enables them to continue their
business.
2. Improving the system of organisation and appointment of insolvency practitioners and
supervision of the performance of the service
Amendments to the Bankruptcy Act have strengthened the framework for the work of insolvency
practitioners by regulating, among other areas, the following changes:
a) Article 82 of the Bankruptcy Act (Article 54 of the Amendments to the Act) redefined the
conditions for appointing insolvency practitioners. According to this article, only legal or
economic professionals with at least three years of experience in the legal and/or the
economics profession will be able to take the professional exam.
b) The conditions for removal from the list of insolvency practitioners have been amended, by
stipulating that insolvency practitioners will be removed from the list when they reach the
age of 70. Exceptionally, insolvency practitioners who reach the age of 70 will be exempt
from assigning new cases and will be removed from the list on completion of all proceedings
in which they have been appointed before the age of 70 (Article 53 of the Amendments to
the Bankruptcy Act, amending Article 81 of the Bankruptcy Act).

54

c) The categorisation of the insolvency practitioners' system and system for assigning cases to
bankruptcy trustees have been redefined. Insolvency practitioners will be entered on the
list of highly qualified insolvency practitioners and the list of qualified insolvency
practitioners. Article 51 of the Amendments to the Act, (Article 79.a of the Bankruptcy Act)
added the criteria for appointing insolvency practitioners to the list of highly qualified
insolvency practitioners; according to these criteria, practitioners must have been on the
list of insolvency practitioners for at least seven years, must have been appointed as
insolvency practitioners in at least two bankruptcy proceedings related to medium or large
businesses or must have successfully completed at least two bankruptcy proceedings by
confirming the bankruptcy plan.
d) With Article 56 of the Amendments to the Bankruptcy Act, Articles 83.a, 83.b and 83.c
ensuring greater efficiency of the supervisions of the performance of the service of
insolvency practitioners were added.
In this way, the role of insolvency practitioners will be further professionalised, better
implementation of bankruptcy proceedings will be enabled, and the case allocation system will be
improved.
3. Deterring against a potential increase in the number of cases due to the conditions of the
COVID-19 pandemic
To prevent a potential increase in the number of cases generally and due to the COVID-19 pandemic
the Bankruptcy Act stipulates a system of early warning tools to signal promptly to entrepreneurs
experiencing financial difficulties, what action is needed to avoid bankruptcy, so they can start
restructuring troubled businesses in a timely manner (Article 4 of the Amendments to the
Bankruptcy Act, that is Article 7.a of the Bankruptcy Act).
4. Amendment of Article 212 of the Bankruptcy Act relating to avoidance proceedings:
According to the previous Article 212 of the Bankruptcy Act, plaintiffs/ bankruptcy creditors had the
right of priority settlement from the benefits returned to the bankruptcy estate in proportion to
the amount of their established claim.
In accordance with the amendments to Article 212, a bankruptcy creditor who has successfully
rebutted a legal action by which they have been damaged is entitled to priority settlement only for
the costs necessary for the litigation (Article 69 of the Amendments to the Bankruptcy Act)
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 216 - HR-C[C25]-R[R1] Increasing the efficiency of the justice
system to increase citizens’ trust
Name of the milestone: Adopted amendments to the Code of Criminal Procedure
Qualitative indicator: Entry into force of amendments to the Code of
Time: Q2 2022
Criminal Procedure
Context:
The objective of the reform is to establish a legal, organisational and technological framework that
will help to reduce backlogs and shorten court proceedings, focusing on transparent and efficient
administration of the justice system.
The milestone entails the entry into force of amendments to the Code of Criminal Procedure Act to
allow for the use of information and communications technology (ICT) in criminal proceedings,
including the introduction of remote hearings, the extension of the possibility of giving online
testimonies for victims of crime, the possibility to communicate with lawyers via a secure video link
Number: 216

55

the preparation of hearings for accused people in pre-trial detention, and the introduction of ecommunication.
This milestone together with milestones #214 and #215 are part of the second payment request
and represent initial steps for completing reform C2.5.R1: Increasing the efficiency of the justice
system to increase citizens’ trust. The reform also includes other milestones (milestones #217 to
#233), which have to be completed after 2022 and before Q2 2026.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document justifying how the milestone was satisfactorily fulfilled (Cover
note).
b) Copy of the adopted amendments to the Code of Criminal Procedure and link to the
Official Gazette website (No. 80/2022) where it can be viewed:
https://narodne-novine.nn.hr/clanci/sluzbeni/2022_07_80_1169.html
Analysis:
As required by the Council Implementing Decision, the relevant amendments to the Code of
Criminal Procedure were adopted by the Croatian Parliament on 1 July 2022 and entered into force
on 19 July 2022, in accordance with Article 49 of the Amendments to the Criminal Procedure Code.
The amendments to the Code of Criminal Procedure contain the following provisions:
1. Allowing the use of ICT in criminal proceedings
Article 8 of the Act, adding Article 78.a, provides for the possibility of filing submissions through the
established information system. Moreover, state authorities, public prosecutor’s offices, lawyers,
court experts, court interpreters and legal persons are obliged to communicate with the court in
electronic form.
2. Further extension of remote hearings
The Act further expands the use of virtual participation in criminal proceedings by providing the
possibility of allowing parties to the session of the indictment panel and the preliminary hearing to
connect remotely via an audio-video link subject to a decision by the president of the panel,
depending on the specific circumstances of each case (Article 28 and Article 29 of the Act).
3. Extension of the possibility of giving on-line testimonies for victims of crime
Article 4 of the Act expands the catalogue of victims' rights provided for in Article 43 (1) of the
Criminal Procedure Code in such a way that the victims of any criminal offense are given the right
to propose that they be examined via audio-video link. This will be decided by the court in each
specific case, considering also the interests of the criminal proceedings, the reasons why the victim
proposes to be examined remotely, etc. This is a right for the victim regardless of the findings arising
from the individual assessment of their situation and does not jeopardise the right of victims of
certain crimes to request remote online interrogation.
4. Possibility to communicate with lawyers via a secure video link and the preparation of hearings
for accused persons in pre-trial detention
Article 15 of the Act lays down the possibility to ensure free, undisturbed, and confidential
communication between an accused person in pre-trial detention and his defence counsel by
means of an audio-video link. This will depend primarily on the consent of the defendant.
5. The introduction of e-communication

56

Article 8 of the Act, adding Article 78.a, prescribes the possibility of submitting briefs and
documents that exist in electronic form through the information system to the body conducting the
proceedings. For certain participants in the proceedings, it is mandatory to submit documents that
exist in electronic form to the court through the information system.
The article also stipulates that the ministry in charge of justice must establish an information system
with high security standards in accordance with the provisions the Criminal Procedure Code and
other regulations governing the protection of personal data. The Act stipulates that ecommunication will be regulated in detail by an ordinance which was adopted on 22 August 2022
(https://narodne-novine.nn.hr/clanci/sluzbeni/2022_08_97_1441.html) and entered into force on
30 August 2022.
The Ordinance on Electronic Communication in Criminal Procedure set out the prerequisites for
submitting submissions and delivery in electronic form, the forms of records of electronic
submissions and the organisation and operation of the information system. With this Ordinance, ecommunication in criminal procedures became fully applicable.
Article 11 of the Act stipulates that where a submission is filed by means of an information system
(Article 78.a), the official time of receipt by the authority conducting the proceeding will be the time
the information system sent the applicant confirmation of receipt.
It is considered that anyone sending a submission who acted within the time limit has not missed
the deadline if the system did not send the receipt confirmation or the sender did not receive a
court statement of receipt for their submission, due to a malfunction of the information system,
which the sender did not know about.
Articles 17, 18, 19 and 20 of the Act enable court decisions and documents to be served on parties
via the information system. This is mandatory for participants who are obliged to communicate
through the system. However, if they consent to it, other parties in the procedure who are not
obliged to use e-communication will receive court decisions and documents through the
information system. They must give this consent in writing or orally on the record and can withdraw
it at any time during the proceedings.
Article 19 of the Act (adding a new Article 172a) prescribes how decisions/documents are to be the
manner of performing served via the information system. Decisions or correspondence are served
by being delivered to the recipient's secure electronic mailbox. The information system shall
simultaneously send the same addressee a separate e-mail informing them that the documents
have been served, containing a warning on the presumption that the decisions/documents will be
considered to have been served eight days after they were received in the recipient’s secure
electronic mailbox.
Paragraph 4 of Article 172a lays down the possibility to scan decisions and documents that have
originals in physical form and to serve them to the participants through the information system, if
the scanned decision or document has been attested by the qualified electronic seal of the court.
It is also stipulated that servicing through the information system is considered to be direct service,
i.e., it is presumed that the decision or document was served to the addressee in person.
The amendments to the Code of Criminal Procedure strengthen the legislative framework by
introducing e-communication, expanding remote hearings and strengthening the rights of all
participants. As such, the amendments to the Code of Criminal Procedure help reduce of the
duration of criminal proceedings and improve the overall quality of delivering justice in criminal
proceedings.
Commission Preliminary Assessment: Satisfactorily fulfilled

57

Number: 266

Related Measure: 266 - HR-C[C31]-R[R1] Structural reform of the education
system

Name of the milestone: Comprehensive analysis of secondary education needs
Qualitative indicator: Publication on the website of the Ministry of Science
and Education of the results of the comprehensive analysis conducted on
Time: Q1 2022
secondary education needs
Context:
Structural reform of the education system under the education component aims to support access
to education, as well as its quality, at all levels of education. This reform is subdivided into four
areas corresponding to different levels of education. The first area deals with early childhood
education and care, and the second one concerns primary schools. The third one, assessed herein,
is the reform whose aim is to increase the relevance of secondary education. And the fourth one
covers adult education. To increase the relevance of secondary education, the reform foresees an
increase in students’ enrolment in general secondary education (‘gimnazija’ programmes), while
reducing the share of surplus vocational education and training (VET) enrolments and improving
the labour market relevance of vocational programmes.
Milestone #266 requires the publication of the Comprehensive analysis of secondary education
needs, which comprises the relevant elements that will support the achievement of the abovementioned measures, namely: 1) to increase the share of students enrolled in general secondary
education programmes; 2) to reduce the share of students enrolled in surplus vocational
programmes; and 3) to align vocational programmes with labour market needs. These measures
will, among other things, contribute towards reaching Target #272 (Enrolment in general secondary
education programmes) due by Q2 2026, which relates exclusively to the first measure (to increase
the share of students enrolled in general secondary education programmes). However, there are
no specific milestones and targets that would provide a basis for the follow up of the other two
measures (i.e., to reduce the share of students enrolled in surplus vocational programmes and to
align vocational programmes with labour market needs).
Furthermore, in line with the description of the measure in the Council Implementing Decision
following the Comprehensive analysis of secondary education needs related to secondary schools
by Q4 2023 the following actions will be implemented: a) introduction of a new curricula based on
qualification and occupational standards of the Croatian Qualifications Framework; b) development
of new teaching material; and ensure c) professional training of vocational education teachers. This
set of actions will be considered under the assessment of milestone #268 (Adoption of the
amendments for a full-day teaching model).
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Copy of the Comprehensive analysis of secondary education needs (Studija SO V1.1,
September 2022).
b) Document duly justifying how the milestone (including all the constitutive elements)
was satisfactorily fulfilled, with links to the underlying evidence and with a link to the
study published on the Website of the Ministry of Science and Education (Cover note).
‘The authorities also provided:’
c) Annexes to the Comprehensive analysis of secondary education needs (background data
used in the Comprehensive analysis of secondary education needs) (Prilozi Tablice Excel
file, 19 September 2022)
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Analysis:
As set out in the Council Implementing Decision, the Comprehensive analysis of secondary
education needs addresses the necessary requirements that are part of the structural reform of the
education system.
The Comprehensive analysis of secondary education needs, along with its Annexes, was published
on the website of Ministry of Science and Education on 19 September 2022.
The following elements were addressed by the Comprehensive analysis of secondary education
needs and its Annexes:
First, regarding increasing the relevance of secondary education and the increase in the share of
students enrolled in general secondary education programmes, the Comprehensive analysis of
secondary education needs directly contributes to achieving this objective of the reform (deciding
on the appropriate policy interventions), as it provides the following in-depth analysis and main
findings:
1. The demographic trends (chapter 1) - identifies and interprets the trends and helps to predict
the total size of enrolment in all relevant programmes. The trends show that at national level,
by 2024 the enrolment cohort will increase by 4-8%, and by 2029 it will be 4-10% lower than in
2021.
2. The enrolment in certain types of secondary education and regional differences in their
availability (chapter 2) - helping to decide how to distribute capacities per each type of general
education programme – indicating that in the school years from 2013/2014 until 2021/2022
there was a decrease in the number of enrolled students in the general education programmes
(which is also largely the case also for VET programs), and that the number of students enrolled
in individual gymnasium programmes decreased between 2013 and 2021 for all four of the
most represented types of gymnasiums (general, science-math, language and classical), where
the decline was most pronounced in general gymnasiums (21%);
3. The utilisation of secondary education capacities and regional differences in capacities (chapter
3) - to show to what extent capacities are full and to understand where there is potential to
increase the existing capacities. It indicated that, despite the downward demographic trend
described above, the share of enrolment capacities filled is highest in general secondary
education (92-96%), a persistent pattern in most counties.
4. The different instruments and rules that regulate the capacities in secondary schools (Chapter
7) - shows the available instruments, how they are applied in practice, and how this could be
used to increase the share of student enrolment in general secondary education programmes.
The analysis includes changes in enrolment quotas and scholarship programmes among the
main instruments.
5. The interest for all different types of secondary education programmes and VET sectors within
VET secondary education (Chapter 6) - helps explain the preferences of students (as sometimes
their preferences do not necessarily match the enrolment or the capacities available) and to
use it for enrolment capacities transformation. The findings show that, historically, each time
capacities in general secondary education programmes were expanded, there was a
corresponding demand to utilise them to a large extent.
6. The aspirations and patterns of transition from VET to higher education, including the frequency
and suitability of higher education enrolment in comparison to attended VET sectors (Chapter
4) - to use it for enrolment capacities transformation (VET to general secondary education).The
findings show that a higher rate of participation in gymnasium programmes should have a
positive effect on enrolment in higher education, and that there is an additional pool of
students in VET to benefit from increased capacities, as they aspire to enrol in higher education;

59

Based on all of the above, the Comprehensive analysis of secondary education sets the following
recommendations (Chapter 9) for increasing the capacity of general secondary education
programmes to 40% of the total public offer of regular secondary education: (1) not to reduce the
number of classes in publicly funded gymnasium programmes; (2) to increase the number of
enrolment places in existing gymnasium classes to 26 (as is currently the case in the City of Zagreb);
(3) to reactivate the gymnasium capacities of schools that have successfully experimentally
implemented vocational gymnasium programs for several years; and (4) to introduce 28 gymnasium
classes in 13 counties during the current decade. The Comprehensive analysis also recommends
producing a more in-depth analysis of the existing priorities and enrolments in the central student
enrolment system (NISPUSŠ database). This would allow for a better understanding of the
boundaries and patterns of general secondary school preferences, including at sectoral level.
Furthermore, it sets out other available tools to increase general secondary education enrolment,
namely: 1) changing the relevant quotas adopted by the Ministry of Science and Education for every
school year; 2) transforming of surplus VET programmes into general secondary education
programmes in dialogue with founders; and 3) allocating funds as an incentive to the founders to
increase the share in general secondary education (their share in large cities is more than 40% while
it is under 20% in less developed regions).
Second, the Comprehensive analysis of secondary education needs has analysed the following
parameters which support the measures to reduce the share of students enrolled in surplus
vocational programmes, to be set out by Q4 2023:
1. Comparison of the share of the 14 most relevant sectors on the labour market with the
structure of vocational education and analysis of recommendations by the Croatian
Employment Service in a decennial perspective (Chapter 5). This gives information on trends in
alignment of VET programmes with labour market needs on sector and county level, based on
which a decision on optimisation of capacities could be made. The comparison shows that there
are surplus enrolments in several sectors, which are identified in the analysis, and that there is
variation between counties for most sectors.
2. The enrolment between 2013 and 2022 in: a) VET programmes, b) newly developed VET
programmes and c) schools designated as VET centres of competences (Chapter 2). This analysis
contributes to optimising capacities at local level respecting current trends per type of
programmes/sectors. The findings show that the introduction of new vocational curricula
resulted in a higher number of enrolled students, and that interest among students to enrol in
schools designated as VET centres of competences is expected to increase.
3. The development of capacities, enrolment patterns in different sectors, tracking where surplus
programmes are located and regional differences in capacities (Chapter 3) help explain the
historical trends in terms of relation between capacities and enrolment patterns, which is
important for deciding on capacity changes. The findings corroborate the evidence on surplus
programmes as elaborated under point 1.
4. The aspirations and patterns of transition from VET to higher education, including the frequency
and suitability of higher education enrolment in comparison to attended VET sectors (Chapter
4) – help decide where to intervene in surplus vocational programme quotas. The findings
demonstrate that a large share of VET students from most sectors where recommendations
indicate ’surplus supply’ proceed directly to higher education institutions.
5. The interest for all different types of secondary education programmes and VET sectors within
VET secondary education (Chapter 6) can explain the ratio between interests and enrolment
places per each VET sector, which is necessary information for further planning of quotas in VET
system. The findings show that no improvement in interest for sectors with surplus capacity
have been identified over the past decade.
6. The different instruments and rules that regulate the capacities in secondary schools (Chapter
7) - show the available instruments, how they are applied in practice, and how this could be
60

used to adjust the number of enrolment places in accordance with the interests of students
with the aim of optimising the VET system. The findings as described above under point 4 of
the analysis show an increase in the share of students enrolled in general secondary education
programmes.
Based on all of the above, the Comprehensive analysis of secondary education recommends the
modalities that could help reduce the share of students enrolled in surplus vocational programmes
beyond the existing trends that already work in this direction (Chapter 9), which are already
reflected above in the recommendations for increasing the capacity of general secondary education
programmes, as the two objectives are aligned.
Third, regarding the alignment of vocational programmes with labour market needs, to be achieved
by Q4 2023, the Comprehensive analysis of secondary education needs has included the following
research findings:
1. The demographic trends (Chapter 1) - to optimise the enrolment structure capacities at regional
level – indicating that the negative demographic trends which have been reflected in the
decrease of enrolment cohorts in the secondary education system (the size of the generation
in 2021/2022 was more than 16 % lower than 2013) was not equally distributed at the level of
different counties.
2. The enrolment between 2013 and 2022 in a) VET programmes, b) newly developed VET
programmes and c) schools designated as VET centres of competences (Chapter 2) – helps to
contribute to the optimisation of capacities at local level, respecting current trends per type of
programme/sector, and to help with decisions on further introduction of new curricula at the
local level. The findings are as already mentioned above under point 2 of the analysis of support
for the measures to reduce the share of students enrolled in surplus vocational programmes;
3. The comparison of the share of the sector on the labour market with the structure of vocational
education and analysis of recommendations by the Croatian Employment Service in a decennial
perspective (Chapter 5) shows trends in alignment of VET programmes with labour market
needs ta sector and county level, based on which decisions on optimisation of capacities and
modernising the curricula for deficit programmes could be made. The comparison identifies
sectors with positive employment trends and areas of insufficient capacity in the regular VET
system;
Based on all of the above, the Comprehensive analysis of secondary education recommends the
modalities that could ensure the capacity of deficient programmes mentioned under point 3 is not
negatively affected, and that could help prevent the expansion of surplus programmes (Chapter 9).
This can be done by improving the quality of relevant VET programmes and thereby increasing their
attractiveness. Improvements are recommended by developing new VET programmes (based on
the Croatian Qualification Framework (CROQF) standards and procedures), by applying a modular
approach, by increasing the quality of teaching (professional training of vocational education
teachers and development of new teaching material), as well as by improving learning conditions
(fully functioning, innovative and well-equipped centres of competences).
Based on the analysis and research supporting each of the requirements, as presented above, the
Comprehensive analysis of secondary education also includes in Chapter 8 a simulation of future
changes based on the projection of demographic changes, analysing the additional capacities
needed to achieve the target increase in the percentage of pupils attending general secondary
education programme and projected enrolments per sector and per county until 2029. This will
facilitate informed decision-making for the necessary sector-level intervention.
As explained above, the Comprehensive analysis of secondary education contains the necessary
elements to support measures to increase the share of students enrolled in general secondary

61

education programmes, to reduce the share of students enrolled in surplus vocational programmes
and to align vocational programmes with labour market needs, as specified in the CID.
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 286 - HR-C[C41]-R[R1] Development and implementation of
new targeted active labour market policies for the purposes of green and
digital transition of the labour market
Name of the milestone: Supplementing active labour market policies
Qualitative indicator: Three new active labour market policy measures
Time: Q1 2022
adopted.
Context:
The objective of this measure is to adopt new active labour market policies (ALMP) to boost
employment and self-employment linked to the green and digital transitions and increase the
competitiveness and employability of the labour force in line with labour market needs and with a
particular focus on the activation of the long-term unemployed and less employable people from
vulnerable groups. The distribution of grant funding to support employment shall amount to 70%
of the total allocation to jobs related to the green transition and 30% to jobs related to the digital
transition.
Number: 286

This milestone consists of the adoption of three new ALMPs related to the twin transitions and is
the only milestone related to measure C.4.1.R1 - Supplementing active labour market policies.
Specifically, it includes: i) grant support for employment, where special attention is given to
disadvantaged groups and people with disabilities; ii) grant support for traineeships, with a focus
on unemployed people with no prior work experience in the Croatian Employment Service (CES);
and iii) grant support for self-employment for the unemployed.
This is the only milestone related to measure C.4.1.R1. The next and final step includes Target #287
- Number of beneficiaries of the new active labour market policy measures, with time of completion
at Q4 2025.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the milestone was fulfilled (Cover note).
b) Copy of the Green-jobs guidelines approved (CES webpage, April 2022).
c) Copy of the Croatian Employment Services’ decision adopting the Terms and Conditions for
the implementation of the new active labour market policies (ref. 344-70/1-21-2/7, 28
December 2022).
d) Copy of the Croatian Employment Services’ decision amending the Terms and Conditions for
the implementation of the new active labour market policies (ref. 344-70/1-22-A, 7 March
2022).
e) Copy of the Conditions and methods of using funds for the implementation measures in
2022, containing the conditions, criteria and descriptions of the three new active labour
market policies (CES webpage, 30 March 2022).
Analysis:
The Conditions for the new active labour market policies (ALMPs) were adopted by a decision of
the Croatian Employment Services (CES), entering into force on 28 December 2021. After
consultations with the Commission, the definition of green and digital jobs included in the
conditions was amended on 7 March 2022 through a new decision of the CES.

62

As set out in the Council Implementing Decision (CID), the CES adopted three new ALMPs to
support job creation in the green and digital transitions:
1. The first ALMP provides for grant support for employment in jobs related to the green and
digital transitions (pp. 25-27 of the Conditions and methods for the implementation of ALMPs).
These jobs were defined in close cooperation with the Commission to ensure that appropriate
standards are met. The standard used to define green jobs is in line with best practices, in
particular the International Labour Organization’s standards to help improve energy and raw
materials efficiency, limit greenhouse emissions, minimise waste and pollution, protect and
restore ecosystems and support adaptation to climate change. Moreover, as established in the
guidelines, all entities must contribute through their activity to one or more environmental
objectives as set out in Regulation (EU) 2020/852 on the establishment of a framework to
facilitate sustainable investment without harming other environmental objectives. The
definition of green jobs required special attention as this measure contributes with a 100%
climate tag to the green transition (p. 11). As mandated by the CID, special attention is given to
prioritise reactivation and self-employment of disadvantaged groups. This is done by defining
specific disadvantaged target groups for this measure, as established in p. 18 of the Conditions.
In particular, eligible groups include: (i) people who have not been employed on a regular basis
during the last 6 months; (ii) people aged between 15 and 24; (iii) people over 50; (iv) people
who have not a completed high-school education; (v) Roma people; and (vi) people who do not
have working experience and are employed in jobs for which they have not been trained.
People with disabilities registered as unemployed in CES are also to be considered a target
group.
2. The second ALMP focuses on grant support for traineeships related to the green and digital
transitions, following the definitions of green and digital jobs set out in the Conditions for green
and digital jobs (pp. 11-12). The target group of this measure are people registered as
unemployed in the CES with no prior work experience thereby catering to young people not in
employment, education or training (NEET). The intensity of support varies depending on the
educational level of the beneficiary.
3. The third ALMP deals with grants in digital and green jobs for unemployed people who decide
to start a business (become self-employed). As per the CID, CES defined a variable amount, on
top of a fixed one, which is assigned to those self-employees who successfully presented their
business plans (pp. 40-41), taking into consideration a set of criteria relevant for the consistency
of applicants’ business plans with the green and digital transitions. Each application is assessed
by applying scores to a set of criteria as defined in pp. 42-44 of the Conditions, such as: (i)
professional experience in the activity in which the person wants to be self-employed; (ii) the
education level or further training in the activity to which they intend to dedicate themselves;
(iii) whether it is their first entrepreneurial experience; (iv) the occupancy and
comprehensibility of the business plan; (v) the development index of the local government unit
in which the business entity is established; (vi) additional advantages and disadvantages of the
plan in terms of sustainability and competitiveness; (vi) innovativeness of the project; or vii)
whether it is an investment in missing activities.
4. All these measures have been put in place through the adoption by CES of the ’Conditions and
modalities for the use of funds for the implementation of measures in 2022’.
To increase the coverage of ALMPs, the CID mandates that the duration of these measures should
be extended for up to 2 years (24 months) for severely disadvantaged groups. In this sense,
employment grants duration is extended for up to 2 years for people with disabilities as registered
in CES and unemployed self-employees.
Moreover, the inclusion of vulnerable groups –inactive, long-term unemployed and young not in
education, employment or training (NEET)– is a priority in all active labour market policies, including
63

these three new measures, as defined in the specific target groups mentioned above. At the same
time, lifelong career guidance centres (CISOK) are to provide support in attracting NEETs through
better informing about new ALMPs.
According to the Council Implementing Decision, the new measures for the long-term unemployed
and less employable people from vulnerable groups are combined with the use of skills vouchers.
According to the Conditions (p. 66), CES advisors, through the necessary profiling of the
unemployed, determine whether the person benefiting from ALMPs also needs additional training
to ensure a better match in the labour market.
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 291 - HR-C[C41]-R[R3] Setting up a voucher system for adult
education, training and upskilling
Name of the milestone: Developing skills according to market needs
Qualitative indicator: Voucher system in use
Time: Q1 2022
Context:
The objective of this reform is to increase employability of workers and better match supply and
demand on the labour market by supporting lifelong learning and the acquisition of new skills,
particularly green and digital skills.
Number: 291

This milestone provides for the set-up of a new voucher system for adult education, training,
upskilling and reskilling as defined in C.4.1.R3 - Developing skills according to market needs. This is
the only milestone in this reform. Complementary target #292 –Use of education vouchers– is the
following step, which is due in Q2 2026.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the milestone was fulfilled (Cover note), with
appropriate links to the underlying evidence.
b) Copy of the decision of the Croatian Employment Service instituting the voucher system
(Annex I; ref. 344-70/1-22-62, 30 March 2022).
c) A factsheet containing all information about the design and operational aspects of the
measure, as contained in Annex X (Conditions and ways of using funds for the
implementation of education for the acquisition of competencies required for work
through vouchers; CES webpage, April 2022) and XII (Ordinance on the criteria for
selecting competencies required for work, for selecting service providers and for awarding
vouchers to participants in formal or non-formal adult education; ref. 524-04-02/1-22-1,
18 March 2022).
d) The list of the eligible educational programmes and certified educational institutions
under the CROQF, Annexes VII (list of the eligible educational programmes), VIII (list of
certified educational institutions) and XI (list of educational programmes developed in line
with the Methodology for developing adult education programmes).
e) The skills catalogue, Annexes IX (Methodology of mapping the skills needed for digital
and green transformation / transition of the economy; procured by the Ministry of
Labour, Pension System, Families and Social Policies, 7 March 2022), V (list of all green
and digital skills) and VI (list of green and digital skills for which educational programmes
have been developed).
f) Brief description and link to the platform, as established in the cover note.

64

g) A copy of the certificate of completion issued in accordance with the national
legislation¸ Annex II and III (certificates of completion of the voucher platform, listing all
deliverables completed, contract 344/03-3/21 JN 94).
h) Extract of the relevant parts of the technical specifications, as in Annex IV (description of
the technical specifications of the voucher platform).
The authorities also provided:
i) Adult Education Act, published on 27 December 2021 in the Official Gazette (NN
144/2021)
Analysis:
The adoption of the new voucher system was approved by the Governing Council of the Croatian
Employment Service (CES) on 30 March 2022, and it became operational as of 1 April 2022.
According to the CID, the voucher system should be operational and used to finance participation
exclusively in educational programmes developed on the basis of the Croatian Qualifications
Framework (CROQF). This is done by the adoption of the new Adult Education Act (article 12,
paragraphs 5 and 6), which obliges adult educational institutions to harmonize any formal
educational programme with the CROQF. This is further defined in Article 2(2) of the ‘Ordinance on
the criteria for selecting competencies required for work, for selecting service providers and for
awarding vouchers to participants in formal or non-formal adult education’.
Moreover, the CID mandates that at least 25 educational programmes should be involved in the
provision of education through vouchers. There is evidence that there are currently over 39
different educational programmes developed for the acquisition of green and digital skills, as can
be seen in the voucher system webpage and the lists provided by the authorities (Annex XI). These
programmes are at the moment offered by more than 51 accredited institutions certified under
CROQF along the territory.
With respect to the voucher system, it contains a skills catalogue that maps existing and needed
skills in the labour market, as well as an IT application for managing and awarding vouchers based
on the comprehensive assessment of the potential beneficiaries’ skills. The skills catalogue was
developed following a mapping analysis as set out in the ’Skills mapping methodology’ (Annex IX).
The initial mapping of green and digital knowledge and skills was done according to a methodology
based on a five-step process, separately for green and digital skills. Afterwards, the skills catalogue
was integrated in the IT platform, so that users and educational institutions can select the green
and digital skills available for funding. The IT application has been developed and is operational, as
shown by the working webpage and certificates of completion.
Finally, the CID states that the voucher system shall benefit employed and unemployed people,
with a particular focus on vulnerable groups (long-term unemployed, inactive or young NEETs).
The ‘Ordinance on the criteria for selecting competencies required for work, for selecting service
providers and for awarding vouchers to participants in formal or non-formal adult education’
establishes, in its Article 10, the conditions of the beneficiaries of the voucher system, where it is
required that the eligible person: (i) is out of the regular education system; (ii) out of the system of
higher education and science; and (iii) is not a beneficiary of a pension under the general legislation.
Special attention is paid to the inclusion of vulnerable groups through counselling sessions with CES
advisors, while the number of beneficiaries from vulnerable groups involved in the voucher system
can be monitored at any time through the voucher platform.
Commission Preliminary Assessment: Satisfactorily fulfilled

65

Related Measure: 303 - HR-C[C43]-R[R1] Transparency and adequacy of social
benefits in the social protection system
Name of the milestone: Adoption of the new Social Welfare Act
Qualitative indicator: Entry into force of the new Social Welfare Act
Time: Q1 2022
Context:
The objective of this reform is to increase the adequacy of the main social benefits targeted at the
most vulnerable groups in society, contribute to reducing inequalities, and the administrative
burden and to increase the transparency of the system. The reform will also allow for faster and
more efficient provision of benefits by merging existing social benefits into a single benefit. Some
aspects of this reform are envisaged to be phased in gradually over a longer period, while others
can be implemented more promptly. For this reason, the reform will require changes to the same
legislative act at two points in time.
Milestone #303 consists of the adoption of the new Social Welfare Act that would, among others,
introduce changes related to the guaranteed minimum benefit, combining heating and housing
allowance and introducing a new social mentoring service.
The adoption of C4.3 R1-M#303 new Social Welfare Act represents a middle step in measure C4.3
R1 - Transparency and adequacy of social benefits in the social protection system. The following
steps are milestone R1-M#305: Adoption of a normative rule on functionally integrated social
benefits as a final step of the reform, accompanied by targets C4.3 R1-T#306: At-risk-of-poverty
rate after social transfers and C4.3 R1-T#304: Beneficiaries of the guaranteed minimum benefit.
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
Number: 303

a) Summary document duly justifying how the milestone was satisfactorily fulfilled (cover
note).
b) Copy of the Social Welfare Act and a link to the Official Gazette (No. 18/22).
c) Copy of the Minister Decision on the Guaranteed Minimum Benefit and a link to the
Official Gazette (No. 23/22).
Analysis:
The Social Welfare Act was adopted by the Croatian Parliament 28 January 2022, published in
Official Gazette, No. 18/22 and entered into force on 17 February 2022. The accompanying Decision
of the Government of the Republic of Croatia on the basis for calculating the amount of the
guaranteed minimum benefit (Official Gazette No. 23/22) entered into force on 26 February 2022.
Both documents adequately address all the elements from the description of the milestone in the
Annex to the Council Implementing Decision and the relevant parts of the measure description.
The new Social Welfare Act introduces a number of changes, which are set out below:
1. Heating allowance and existing housing costs have been combined into one integrated
allowance. Articles 41 and 42 provide for the integration of the housing and heating allowances
(Art 41(2)), and for the right to a housing allowance to be granted to a beneficiary of the
guaranteed minimum benefit. The articles also define exceptions. The local government unit or
the City of Zagreb will decide on the recognition of the combined allowance as set in Article
126(3). Article 289, paragraphs 2, 3 and 4 of the Social Welfare Act stipulates that local
government units are obliged to allocate funds in their budgets to exercise the right to housing
allowance as prescribed by the Act and envisages compensation from the state budget.
2. The existing provision on the Guaranteed Minimum Benefit has been changed by raising the
basic amount to HRK 1 000 and establishing an increase of at least 25% for households with
children by relaxing the most difficult eligibility criteria, including through an increase of the
income threshold to HRK 1 000 (Decision of the Government of the Republic of Croatia on the
basis for calculating the amount of the guaranteed minimum benefit; and Articles 27, 22(1),
66

29(1), (2) and 23 to 40 of the Social Welfare Act which relate to Guaranteed Minimum Benefit).
By the decision of the Government on the basis for calculating the amount of the guaranteed
minimum benefit (Narodne Novine 23/22) the basis for calculating this amount is now HRK 1
000. Article 22 recognises the same amount as the basis (income threshold) for calculating
allowance, and Article 27 sets the percentages to be applied for various recipients. As opposed
to the previous provisioned cap of 100%, the new Social Welfare Act stipulates that the
guaranteed minimum benefit for households cannot exceed 150% of the gross amount of the
minimum wage in the Republic of Croatia.
3. Introduction of a new social mentoring service. Articles 71, 85 and 86 define social mentoring
as a social service, while also setting out key elements of the service. To expedite beneficiaries’
integration on the labour market Article 35(4) of the Act prescribes the obligation of notification
to the competent employment service on the approved social mentoring service and the
obligation to involve representatives of the employment service in the social mentoring
process. Furthermore, the manner of cooperation between services is further regulated by
paragraph 6 of the same Article. Lastly, Articles 126(2), 134, 178(2), 194 and 232 provide
operational provisions necessary for quality implementation of the social service.
4. Structural changes introduced to long-term care ensuring facilitating deinstitutionalisation
and transition to home and community-based services. Article 15(27) defines beneficiary of
long-term care, while Article 74 provides that when developing social services, priority is placed
on the development of missing services. The aim is to ensure that users primarily receive
services in their homes and in the local community that allows them (as long as possible) to stay
in their own home. The accommodation service is provided exceptionally, or only if it is not
possible to provide care in the user's own home. Further contribution to deinstitutionalisation
is provided by elaborating and defining non-institutional services in Article 71(1) to (14), with
further explanation in Articles 79 to 109. Finally, Article 110 prescribes who cannot be entitled
to accommodation services, and Article 111 prescribes who provides accommodation services
to a child, especially in relation to a child under the age of seven. Articles 112 to 116 further
develop the recognition of the right to accommodation services in cases prescribed by Article
74 (2). These provisions provide structural change that facilitate deinstitutionalisation by
prioritising development of home and community services in areas where the services are
missing and by providing new definitions of non-institutional services that enable transition to
home and community -based services.
5. Provision to mandate the cooperation and regular exchange of information between
institutions providing social services and social benefits to ensure a coordinated approach
across the range of delivered services. The obligation on data exchange between the Social
Welfare Institute, the Family Centre and other providers of social services and units of local and
regional government is laid down in Article 117, while the obligation on annual data exchange,
records and documentation keeping is set out in Article 118. Further obligations on assuring
data input and other operational aspects are provided by Articles 168, 178, and 250.
6. As set out in the measure description, this milestone increases the adequacy of the main social
benefits targeted at the most vulnerable groups of society by increasing the amount of the
guaranteed minimum benefit to HRK 1 000 established in the Ministerial Decision on the
Guaranteed Minimum Benefit (Official Gazette No. 23/22). Furthermore, by merging the
housing and heating allowances the milestone allows for a faster and more efficient provision
of services. The eligibility and adequacy in the application of the benefits is improved by adding
and simplifying the criteria in Articles 41-50, and 55.
Commission Preliminary Assessment: Satisfactorily fulfilled

Number: 309

Related Measure: 309 - HR-C[C43]-R[R2] Development of social mentoring
service
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Name of the target: Training of social mentoring professionals
Quantitative indicator: Number of
Baseline: 0
Target: 220
Time: Q2 2022
trained professionals
Context:
The objective of this reform is to ensure sufficient human capacity to provide social services,
through better cooperation and data sharing, to beneficiaries of guaranteed minimum benefits and
disadvantaged groups of beneficiaries. The reform introduces a new social mentoring service
targeted at individuals at risk or already in a marginalised position in society. It makes the new social
mentoring service available to all potential beneficiaries, in particular beneficiaries of Guaranteed
Minimum Benefit, persons with disabilities, victims of violence, the homeless, migrants, Roma,
young people departing from the social welfare system, persons serving prison sentences and
members of other socially vulnerable groups.
Target #309 requires the training of 220 existing social welfare professionals to gain necessary skills
for providing a service of social mentorship.
The training of social mentoring professionals (C4.3-R2-T309) represents an initial step in C4.3 R2
and is the necessary precondition for investment C4.3 R2-I1 - Introduction of social mentoring
services. The following steps in the measure are target Employment of social mentoring
professionals (C4.3-R2-T310) and as a final step, target Social mentoring services provided to
beneficiaries (C4.3-R2-I1-T311).
Evidence Provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the milestone was satisfactorily fulfilled (cover
note).
b) An annex with the following documentary evidence:
1) Annex 1 Curriculum social mentoring
2) Annex 2a Programme of education of social mentors
3) Annex 2b Annex to the contract JN-M-2021-21
4) Annex 3 Report of the implementer of the education of social mentors
5) Annex 4 Table with data of trained social mentors
6) Annex 5 List of providers of social mentor education
7) Annex 6 Example of a certificate of completed education for social mentors
8) Annex 7 Guide for experts of the Croatian Institute for Social Work - Social mentoring
9) An Annex 8 Final evaluation report
10) An Annex 9 Programme of the Expert meeting Sheraton_07072022
11) An Annex 10 Rulebook on Standards and Licensing Procedure
c) The following documentary evidence based on a sample selected by the Commission:
1) regarding a copy of the official document on the initiation of education on social
mentoring:
i. Agreement on public procurement of education of social mentors
ii. The Ministry's invitation to the social welfare centres for regarding the
implementation of education and expression of interest of employees
iii. The Ministry's invitation to the Croatian Employment Service regarding the
implementation of training and expression of interest of employees
2) regarding a copy of the official document by which the candidate (identity
determined by an identification card) is accepted for education:
i. Agreements concluded between the participants and the social welfare
centres, which regulate the mutual rights and obligations of the centre and
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the professional worker resulting from professional training for social
mentors
ii. Decision on sending representatives of the Croatian Employment Service
to train for the provision of social mentoring services
3) regarding the official certificate proving that the candidate has completed
education:
i. certificates of participants from the selected sample
ii. record lists with marked participants from a random sample - confirmation
of attendance at the training of social mentors.
iii. in addition, authorities provided the signed lists of training attendance.
Analysis:
1. The training of social mentoring professionals was conducted between 9 May and 29 June 2022,
through 15 modules in 9 towns: Varaždin, Karlovac, Zagreb, Slavonski Brod, Split, Osijek, Zadar,
Rijeka and Pula (Annex 2a and Annex 3). The aim of the training was to strengthen the
competencies of professionals in the social welfare system to support the implementation of a
social mentoring service as successfully as possible when working with individuals at risk or
already in a marginalised position in society.
2. The training was attended by 256 experts, social workers from the social welfare centres and
employees of the Croatian Employment Service who work with vulnerable groups of users. It
was fully completed by 253 employees, 21 of whom were from regional services/offices of the
Croatian Employment Service (Annex 3, Annex 4). The training was conducted by 15 experts
from the social welfare system, civil society organisations and the academic community with
completed training in social mentoring and practical experience of applying this model of
professional work with beneficiaries. Upon successful completion of the training of social
mentoring professionals, the participants were given certificates.
3. During the training, the social welfare professionals went through all the contents of the
curriculum on social mentoring that are aligned with the learning outcomes (Annex 1). The
CID requirement to cooperate with other community-based social service providers and the
need to actively engage the beneficiaries of social welfare systems in overcoming their own
social exclusion was covered in the first part of the training by implementing the curriculum
featuring the educational content that covers this requirement. That curriculum includes
content on "Social integration of users of social mentoring", "Mapping in the local community"
and topics "Coordination of services - Integrated approach" and "Roles and cooperation of
centres for social welfare, Institute for employment, civil society organisations and other service
providers". The requirement on following the principles of the social work profession and
complement already existing activities of social welfare centres was fulfilled by providing
training on applying all phases of social mentoring (initial phase, building relationships,
determining direction, monitoring progress, etc.). This guides the beneficiaries of the service
and encourages them by building a cooperative relationship to actively include and overcome
their own social exclusion (Annex 2, Annex 7 pp. 14-45). The training also covered skills and
guidance on implementing of the social mentoring service. These included how regular
documentation and monitoring of success is planned, preparation of the social mentoring
professional's quarterly report on the work (Annex 7, p. 54), the social mentoring professional’s
final report (Annex 7, p. 56) and evaluation of the mentoring process and relationship by the
mentored person (Annex 7, pp. 50-51).
Following the training, the participants will be able to create, monitor and evaluate the user’s
individual plan through the building of a collaborative relationship, guided by the principle of an
individualised approach to the user/mentored person. The aim is to encourage the active
engagement of the user in overcoming social exclusion and plan and implement the needed
cooperation with the local community/service providers in the local community.

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Following the selection of a random sample of 60 trained social mentoring professionals, Croatia
submitted a package of documents consisting of initiation of the education, agreements on
education and certificates on completed education. The analysis of the documentation shows that
the evidence presented corresponded to the sample of trained social mentoring professionals
selected by the Commission. Specifically:
1) The agreements for education have been established for 60 trained social
mentoring professionals on the basis of the Ministry’s call for education.
2) In the case of 53 observations, the employees of social welfare centres had
individual mutual agreements for training, while for 7 observations, Croatian
Employment Service employees had a collective agreement.
3) 59 sampled social mentoring professionals fully completed the training (18 hours)
as stated on their certificate, while one sampled case did not complete the training,
also indicated on the certificate. This case was one of the three that Croatia had
already declared as not having completed the training and, as such, matched the
expectations of the sample.
The evidence provided for the sample of 60 social mentoring professionals confirmed that training
was implemented and resulted in the certification of social mentoring professionals. Furthermore,
as both reported by Croatia and resulting from sampling a limited number of cases have not
completed the entire educational programme. However, the analysis showed that the target has
been over-achieved, so it can be concluded that a sufficient number of social mentoring
professionals fully completed the training.
Commission Preliminary Assessment: Satisfactorily fulfilled
Related Measure: 352 - HR-C[C61]-R[R1] Decarbonisation of buildings
Number: 352
Name of the milestone: Adoption of the Programme for the Energy renovation of public sector
buildings for the period 2021-2030
Qualitative indicator: Publication on the official website of the Ministry of
Time: Q2 2022
Physical Planning, Construction and State Assets
Context:
The objective of this reform is to contribute to the renovation wave initiative of the existing
buildings and to the transformation of the existing building stock into a highly energy efficient and
decarbonised building stock by 2050.
This milestone refers to the adoption of the Programme for the energy renovation of public sector
buildings for the period 2021-2030.
The adoption of this programme is the first milestone in the implementation of the measure, to be
followed by the signing of contracts for the energy renovation of public and multi-dwelling buildings
by Q4 2022 (target #353), the energy renovation of public buildings by Q2 2026 (target #355) and
the energy and post-earthquake renovation of public buildings by Q2 2026 (targets #357).
Evidence provided:
In line with the verification mechanism set out in the Operational Arrangements, the following
evidence was provided:
a) Summary document duly justifying how the milestone was satisfactorily fulfilled – Cover
note.
b) Copy of the Programme for the Energy renovation of public sector buildings for the period
until 2030.
c) Copy of the Government Decision from 31 March 2022 on the adoption of the Programme
for Energy renovation of public sector buildings for the period until 2030.
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d) Link to the Government Decision on the adoption of the Programme for Energy renovation
of public sector buildings for the period until 2030, published in Official Gazette 41/2022
on 1 April 2022.
e) Link to the Programme for Energy renovation of public sector buildings for the period until
2030 published on the official website of the Ministry of Physical Planning, Construction
and State Assets on 31 March 2022.
Analysis:
As required by the Council Implementing Decision, the Programme of energy renovation of public
sector buildings for the period until 2030, adopted by the government on 31 March 2022 and
published on the official website of the Ministry of Physical Planning, Construction and State Assets
on 31 March 2022:
1. Contains provisions to encourage comprehensive renovation of public sector buildings as a
combination of energy-efficiency and seismic renovation that will have a lasting impact on
reducing energy consumption in buildings and increasing their safety (pages 9-11, 30, 38-45).
o Chapter 6.1 (pages 38-40) sets priorities for energy and comprehensive renovation of
public sector buildings, putting the focus on buildings with the worst energy properties
and the use of renewable energy sources (RES).
o Chapter 6.2 (pages 41-43) defines eligible activities, including energy and resource
efficiency measures, for energy and comprehensive renovation of public buildings.
Eligible activities also include measures to support smart and sustainable mobility, and
measures supporting motorised transport (installation of recharging points for electric
vehicles and channel infrastructure) that go beyond the requirements set by the
relevant legislation.
o Chapter 6.3 (pages 43-45) defines three different scenarios for implementation of the
energy and comprehensive renovation of public sector buildings, depending on the
types of renovation and available and planned financing sources and models.
2. Maps out planned reductions of thermal needs and energy consumption for public buildings
(pages 25, 33 and 79-80) and the consequent reduction of CO2 emissions (pages 25 and 80).
The cumulative savings in energy consumption in the period until 2030 are estimated to 494,4
GWh, which is a significant contribution to the full energy saving potential reflected in the Longterm strategy for national building stock renovation by 2050 (1,671.4 GWh by 2030). Expected
reduction in CO2 emissions in the period until 2030 is 30.9 kt.
3. Encourages the use of RES by giving it a high score when setting priorities for energy and
comprehensive renovation (page 39) and defining eligible measures for co-financing (pages 4142 and 80-81).
4. Fosters decarbonisation and contributes to achieving a decarbonised building stock by 2050
through the requirement that each renovation requires a reduction in energy consumption for
heating of at least 50% compared to the annual energy consumption for heating before
renovation (pages 38-39, 44, 46-47).
From the evidence provided, it can be concluded that the adoption of the Programme for the Energy
renovation of public sector buildings for the period until 2030 also satisfactorily fulfils the measure
description. The programme estimates that 50% of all renovated buildings will require
comprehensive renovation, which will encourage in-depth renovation of buildings, while paying
particular attention to ensuring healthy indoor climate conditions, fire safety and addressing the
risks related to increased seismic activity.
Commission Preliminary Assessment: Satisfactorily fulfilled

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