Dealing with Construction Permits in
Croatia
Listed below is detailed summary of the procedures, time and costs to build a warehouse —including obtaining necessary licenses and permits, completing required notifications and inspections and obtaining utility connections.
The information appearing on this page was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 183 economies. The most recent round of data collection for the project was completed in June 2011.
-
Building a warehouse
-
Estimated Warehouse Value:
HRK 3,000,000
- City: Zagreb
| No. |
Procedure |
Time to Complete |
Associated Costs |
| * 1 |
Obtain excerpt from the Land Registry for subject and bordering lands
The company must obtain preliminary approvals from various authorities. Such approvals are issued based on the preliminary project design drawings and other documents needed to process the location permit. They are applied for before the application for the application for the issuance of the location permit;however these applications can be filed simultaneously. Land Registry Department of the Municipal Court in Zagreb has transferred a significant portion of Land Registry data into electronic form, as a result, excerpts can be obtained immediately upon request or in a shorter term. Also, as the backlog of cases has reduced due to increased number of staff and other reform efforts, general improvements in the efficiency of the Land Registry Department in Zagreb can be noted. The procedure takes now on average 1 day.
Agency: Land Registry
|
1 day
|
HRK 20
|
| * 2 |
Obtain possession list for subject and bordering lands from the Ministry of Justice
The company must obtain preliminary approvals from various authorities. Such approvals are issued based on the preliminary project design drawings and other documents needed to process the location permit. They are applied for before the application for the issuance of the location permit; however, these applications can be filed simultaneously. The validity of such approvals is 2 years.
Possession list from the Ministry of Justice can be obtained now in 7 days. Before this would take 15 days.
Agency: Ministry of Justice
|
3 days
|
HRK 70
|
| * 3 |
Obtain copy of cadastre plan
This copy can be obtained from the County Office for Cadastre and Geodetic Activities.
Cadastre plan copy can be obtained from the Country Office for Cadastre and Geodetic Activities now takes only 1 day. Previously it used to take 1 week.
Agency: County Office (cadastre and geodetic activities)
|
1 day
|
HRK 110
|
| 4 |
Obtain decision from the municipal authority regarding utilities
The company must obtain a decision from the municipal authority on utility fees, based on the construction permit. The amount of the fee depends on the building size (in cubic meters) and on the location. (Zagreb is divided into seven zones. In the case considered here, the warehouse is in an industrial zone, assumed to be zone 6). The fee can be paid in full or in installments. When BuildCo believes that infrastructure projects (utilities or public roads) need to be undertaken around the plot, the constructor can negotiate with the municipality to finance part of these investments through utility fees. The utilities fee is set from HRK 20 to HRK 180 per cubic meter, depending on the zone (e.g., HRK 37 for zone 6). The volume of the warehouse is calculated according to the methodology provided in the regulation, by using the data (heights) from the project documents. (1300 sq. m. x HRK 37 x 3 m. [height of each story] = 7,800 cubic meters x HRK 37 = HRK 144,300).
Agency: Municipal Authority
|
22 days
|
HRK 144,367
|
| 5 |
Pay water contribution to the state company Croatian Waters (Hrvatske Vode)
Water contribution is paid to finance the management of water resources and protection from floods. The cost is determined based on the zone the new construction is in (Zones A, B, and C – Zone A is Zagreb and the protected coastal area, Zone B is the rest of the country, and Zone C are areas subject to special Government care), the purpose of the construction (residential, industrial, public interest), and the volume of the construction. The cost for the warehouse described in the questionnaire would be 650 m (base)* 6 m (height) * 70 HRK according to the price list of Hrvatske Vode (www.voda.hr).
Agency: Hrvatske Voda
|
15 days
|
HRK 273,000
|
| 6 |
Obtain a final building resolution from the Municipality of City of Zagreb
The construction permit allows the investor to begin construction.
According to the Law on Physical Planning and Construction (Official Gazette Nr. 76/2007., entered into force on October 1, 2007) the building permit is no longer necessary in most cases. It is only required for the construction of infrastructure objects and other buildings provided for by special regulation. The construction of a building with a combined (brutto) surface area under 400 sq meters (600 sq meters for buildings of agricultural use) requires a decision on the construction conditions, which replaces the building permit. The construction of a building exceeding these parameters requires a confirmation of the main project design. It is to be issued by the same body competent for the issuance of the location permit (in this case, Municipality of the City of Zagreb), and replaces the building permit. The request for confirmation of the main project design must be accompanied by the following documents:
- location permit,
- written report on the control of the main project design,
- section on the identity of designer used in the drawing up of the project design,
- certified parcelation for the new land plot.
Project clearances from fire department, sewage and water, telephone, labor inspectorate, and sanitary inspection need to be obtained only when a building permit is required. This would not be the case in regard to BuildCo intended construction. This resulted in elimination of five procedure and accelerated and simplified procedure in that respect.
The project design must comply with the conditions provided for in the location permit and with conditions set out in special laws and regulations. The project designer is liable for compliance. The confirmation of the main project design (as opposed to the building permit and the decision on the construction conditions) is not an administrative decision in legal sense, meaning that interested third parties have no right of appeal - in general, this reform thus eliminates one potential ground for delay.
Provided that all the necessary document have been attached to the application, the competent body is obliged to issue the main project design clearance (confirmation) within 30 days upon submission of the application. However, significant increase in work load resulted in increase backlog and delays in time. In practice the permit is issues in 3-4 months.
The costs amount from HRK 800 (for constructions of 400 sq. m.), 0.50% of the estimated construction costs (for constructions over 400 sq. m.), 0.35% of the estimated construction costs (for constructions over 1,000 sq. m.), and 0.25% of the estimated construction costs (for constructions over 5,000 sq. m. and other unspecified constructions).
Agency: Municipality of City of Zagreb
|
45 days
|
HRK 1,050
|
| 7 |
Obtain water and sewage connection
Agency: Water & Sewage Authority
|
20 days
|
HRK 8,000
|
| * 8 |
Obtain telephone connection
Agency: T-Hrvatski Telekom (T-HT; T-Croatian Telecom)
|
15 days
|
HRK 650
|
| 9 |
Apply for occupancy permit
Under new Law occupancy permit remains mandatory for the use of a completed building. The procedure of issuance has not changed substantially, differing only in the documents which must be enclosed to the request for issuance. Those are the following: (1) confirmation of the main project design, (2) information on the participants in the construction (investor, designer, performer of construction works, supervisory engineer), (3) report of the construction firm which built the object, and (4) final report of the supervisory engineer.
The Municipality forms an evaluation committee within 30 days after the submission of the application for the issuance of the occupancy permit, and determines the date of the on-site inspection. The investor submits various documents which substantiate that the construction has been conducted in accordance with the regulations (e.g. construction diary, licenses of the construction firm which executed the works, technical certificates for the material used in the construction, etc.) to the evaluation committee not later than on the day after the inspection. If any of the member of the evaluation committee finds that the building does not comply with a specific requirement, the investor may be given additional 90 days to make the necessary corrections (if the error is, in fact, corrigible). If all requirements have been met, the Municipality should issue the occupancy permit within 30 days after the inspection.
Agency: Municipality of City of Zagreb
|
90 days
|
HRK 20
|
| * 10 |
Receive on-site inspection and signature of completion statement
Agency: Municipality of City of Zagreb
|
1 day
|
HRK 700
|
| 11 |
Inform tax authority about new building
To pay the real estate tax, the company should notify the tax authority about the new building.
Agency: Tax Authorities
|
1 day
|
no charge
|
| 12 |
Register new construction with Land Registry
Registering the new construction is not mandatory, but without registration the owner cannot take out a mortgage. Having an occupancy permit is a precondition for registering the new construction.
The procedure takes at least 4-5 months assuming we have an experienced lawyer and there are no hindrances of legal nature on the property, and there is a constant follow up. The reality is however, nearly all land plots have some sort of claim disputing the ownership. The Land Registry Court has a major backlog of cases (over 46,000) from previous years. The Court will consider BuildCo’s case based on the order it came, and hence will review papers once other prior documents are reviewed.
Agency: Land Registry Court
|
120 days
|
HRK 500
|
* Takes place simultaneously with another procedure.