From July 1, 2023, and 10 years after Croatia's accession to the EU, it will be possible for foreigners to acquire agricultural land in Croatia on the basis of a legal transaction. This represents a significant change as previously only Croatian citizens and companies registered in Croatia could purchase agricultural land. This new regulation provides an interesting opportunity for foreigners who wish to engage in agriculture or invest in this sector in Croatia.
Croatia has a total area of approximately 2.7 million hectares of agricultural land, of which about 67% (1.8 million hectares) are privately owned and 33% (approximately 890,000 hectares) are owned by the state.
The law on agricultural land, last amended in May 2022 (Official Gazette Narodne noivne2008/15 as amended by 2022/57), has raised legal and political discussions in the past due to concerns about selling to foreigners, which is why the 10-year transition period was set up to liberalize foreign ownership. The law has also led to discussions due to the frequent division of small plots and their conversion into weekend homes. Agricultural land owned by the state can be leased on the basis of a public tender for a period of 25 years, with the possibility of renewal for the same period if there is permanent planting. All other types of agricultural land owned by the state can be leased for a period of 15 years.
Legal Aspects to consider
However, current legislation requires certain legal aspects to be considered, including the considerable number of areas where the Croatian state claims off-book ownership, that is, property rights that are not registered in the land register. In addition, foreigners can only acquire certain types of agricultural land, namely land used for the cultivation of crops and/or animal husbandry. The acquisition of forest and pasture land remains unavailable for foreigners. There are also restrictions on the size of the land that can be acquired, with a maximum of 10 hectares for natural persons and 100 hectares for companies registered in Croatia. For foreign companies not registered in Croatia, the maximum limit is only 10 hectares.
Interesting Prospects for Foreigners
It is also important to note that foreigners must obtain approval from the Ministry of Agriculture to acquire agricultural land in Croatia. To obtain approval, foreigners must meet certain conditions, including registering a company in Croatia or being a natural person residing in Croatia. There are also some exceptions to the approval requirement. For example, EU citizens residing in Croatia do not need approval to purchase agricultural land. It is also important to note that foreigners who purchase agricultural land in Croatia must meet certain legal requirements, such as complying with Croatian environmental standards and labor laws.
Overall, the opportunity to purchase agricultural land in Croatia, which will come into force in July 2023, offers interesting prospects for foreigners.