Excerpt from Small Business Stimulation Act

Excerpt from Small Business Stimulation Act, published in Official Gazette Narodne Novine 29/2002, 63/2007, 53/2012 and 56/2013.

Article 2

(1) Small business, as stipulated by this Act, are constituting entities which are:

  1. in average employing less than 250 employees per year
  2. independent in their operations, i.e. autonomous entities that are not classified as a partner entities and/or associated entities, in accordance with the Commission Recommendation 2003/361 / EC of May 6, 2003
  3. according to the financial statements for the previous year have an annual operating income of up to 50.000.000 EUR, or have value of total assets if they are profit tax payers, or long-term assets, if they are subject to income tax, up to 43.000.000 EUR.

(2) Small business entities are individuals or legal entities which are in dependant and continuous performing allowed activities with aim to generate profit or income on the market.

(3) Independence in operations, as stipulated by this Act, means that the other individuals or legal entities, which are not conformant with the criteria from the paragraph (1) of this Article, are not the owners, individually or together, of more than 25% of ownership share or decision taking rights in the small business subject.

(4) Independence in operations exists even when the 25% share from the paragraph (3) of this Article is exceeded if:

  • share in ownership or decision taking in small business subject has investment fund or some other institutional investor, in case that they don’t have control over the small business subject either individually or together with the others, or
  • distribution of ownership shares in small business subject could not be determined and therefore it is justified to assume, based on special written statement of small business subject that other individuals or legal entities which are not conformant with the criteria from the paragraph (1) of this Article, are not the owners, individually or together, of more than 25% share.

Article 3

(1)  According to the size, as stipulated by this Act, small business subjects are categorized as micro, small and middle sized.

(2)  Micro sized small business subjects are individuals or legal entities from Article 2 of this Act, which are:

  1. in average employing less than 10 employees per year
  2. according to the financial statements for the previous year have an annual operating income of up to 2.000.000 EUR, or have value of total assets if they are profit tax payers, or long-term assets, if they are subject to income tax, up to 2.000.000 EUR.

(3)  Small sized small business subjects are individuals or legal entities from Article 2 of this Act which:

  1. in average employing less than 50 employees per year
  2. according to the financial statements for the previous year have an annual operating income of up to 10.000.000 EUR, or have value of total assets if they are profit tax payers, or long-term assets, if they are subject to income tax, up to 10.000.000 EUR.

(4) Middle sized small business subjects are individuals or legal entities from Article 2 of this Act which have average number of employees, annual turnover or balance sheet value or long-term assets value higher of those defined in paragraph (3) of this Article.

(5) According to the size in terms of this Act investment projects are differentiated as micro, small and medium projects:

  1. Micro investment project is representing investment by the small business entity in the amount of up to 2.000.000 EUR
  2. Small investment project is representing investment by the small business entity in the amount of up to 10.000.000 EUR
  3. Medium investment project is representing investment by the small business entity in the amount of up to 2.000.000 EUR