In the two and a half years since the entry into force of the Consumer Bankruptcy Act which introduced personal bankruptcy proceedings, from early 2016 to mid-2018, 1,204 Croatians filed for bankruptcy with the Financial Agency (Fina), with 69.9 percent of these cases resulting in failed out-of-court settlements.

In the period between 1 January 2016 and 18 June 2018, Fina said on Tuesday, a total of 1,201 individuals and three small businesses formally filed for out-of-court settlements, with their total debts amounting to almost 874 million kuna (€118 million).

The majority of requests were filed with Fina’s office in Zagreb, which accounted for more than half of all cases. It is followed by Osijek, with 97 requests for out-of-court settlements, Pula (79), Split (55), and Rijeka, where 52 people filed for bankruptcy settlements.

In terms of debts, Zagreb also leads the way, with around 650 filings accounting for 427 million kuna of debt (€58 million).

The law regulating consumer bankruptcies took effect on 1 January 2016. For a consumer bankruptcy procedure to be launched, the applicant must be unable to pay one or more claims exceeding 30,000 kuna (€4,070) in total for a period of at least 90 days.

Such a procedure may also be launched by a small business owner, on the condition they do not have more than 20 creditors, do not owe more than 100,000 kuna (€13,500), do not have labour-related obligations and against whom pre-bankruptcy or bankruptcy proceedings have not already been launched.

Consumer bankruptcy proceedings are conducted by courts, but the law stipulates that before they are launched, the debtor and the creditor should try to reach an out-of-court settlement.

(€1 = 7.37 kuna)

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