Financial Crime World

Croatia’s Banking Regulations: A Guide for Compliance

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As the financial services landscape continues to evolve, regulatory bodies must adapt to ensure stability and security. In Croatia, the Croatian National Bank (CNB) and the Croatian Financial Services Supervisory Agency (HANFA) play a crucial role in overseeing the banking sector.

Challenges in Regulatory Clarity and Consistency

Despite its relatively developed economy, Croatia still faces challenges in terms of regulatory clarity and consistency. However, the country is making efforts to harmonize its laws with EU standards, which has created opportunities for fintech companies to establish themselves in the market.

Harmonization with EU Standards

The CNB has been working closely with the European Central Bank (ECB) to implement EU regulations, including:

  • Payment Services Directive (PSD2)
  • Electronic Money Directive (EMD)
  • Markets in Financial Instruments Directive (MiFID2)

Regulatory Environment for Foreign Passported Financial Institutions

For foreign passported financial institutions looking to establish a presence in Croatia, understanding the regulatory environment is crucial. The country’s laws allow for the provision of banking services through agents or representatives, but certain limitations apply.

Outsourcing and Externalisation

Outsourcing (or externalisation) is explicitly regulated by several pieces of legislation, requiring:

  • Notification to the regulator
  • Adequate risk management
  • Direct supervision over the externalised business

Seeking Expert Advice

The lack of developed regulatory sandboxes or hubs means that interested parties should seek specific advice from legal advisors and the regulator before proceeding with any implementation.

Contact Us for Expert Guidance

If you’re looking for expert guidance on Croatia’s banking regulations, our team at Kinstellar is here to help. With our unique blend of legal acumen and commercial expertise, we can provide valuable insights and guidance every step of the way.

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