Friday, 23 August 2019

Croatian Gaming Companies Protest US-Croatia Double Taxation

As Novac writes on the 22nd of August, 2019, the double taxation between the USA and Croatia cuts sales revenue by a significant 30 percent over in the US. This was rightfully complained about by Roman Ribarić, the CEO of Abest, the company behind gaming studio Croteam, which created the most popular Croatian video game, Serious Sam. Abest, along with eight other home gaming studios, is currently participating in the world's largest digital entertainment fair Gamescom in Cologne, Germany.

From that location, they warned that Croatia is the only European Union member state which still has no double taxation agreement with the United States of America, which makes more than twrenty Croatian gaming companies, which are almost 100 percent exporters not only less competitive on the world market, but have significantly lower revenues.

''The biggest challenge is that we don't have a double tax treaty with the US. This is a problem for every studio, especially for young people who want to start doing something and get the most out of their income,'' said Andrej Levenski, the CEO of Pandora studio (Gamepires), the creator of the popular SCUM computer game, which has sold an incredible 1.5 million copies worldwide.

Just like Gamepires, Exordium Games exports almost one hundred percent of its products, meaning that it generates the bulk of its sales abroad through digital game distribution platforms. Until recently, they were focused on the computer market, but with the help of an American publisher, their latest Bear With Me title was placed on all consoles mobile platforms. The last Pottery mobile game was played by over sixteen million players in June and July 2019.

Exordium Games' CEO Andrej Kovačević said that this was their fifth appearance at Gamescom.

''The Croatian stand is getting better and better every year, and the continued presence of local creators is a great testament to the seriousness of the Croatian scene in the international context,'' said Kovačević.

For the sixth consecutive year, the Croatian Chamber of Commerce (HGK) has been organising the presence of the Croatian computer game industry at the Cologne-based fair, which brings together over one thousand exhibitors.

This year, Digital Adventure, Twice Two, Intercorona, Iron Ward, Exordium Games, Pandora studio, Abest, Games Revolted and Soap Interactive, all of which are known worldwide for 2x2, Reboot, LGM Games, Ironward, Exordium Games brands, Gamepires, Croteam, Games Revolted and Soap Interactive, were showcasing Croatian innovation in Germany.

Make sure to follow our dedicated Made in Croatia and business pages for much more.

Wednesday, 21 August 2019

Gaming Companies Call for Reaching USA-Croatia Double Taxation Avoidance Deal

ZAGREB, August 21, 2019 - Computer gaming is the most propulsive segment of the IT industry worldwide, and this trend is present in Croatia, too, where local gaming companies export all their products, however the biggest challenge in doing business is the absence of a Croatia-USA double taxation avoidance agreement, which affects their revenues and negatively impacts their competitiveness, representatives of the Croatian exhibitors at the Gamescon fair in Cologne have said.

The fair in that German city is open to visitors from 21 to 24 August.

According to a press release from the Croatian Chamber of Commerce (HGK), Croatian exhibitors are participating in the fair for the sixth consecutive year.

A survey of Croatian creative and cultural industries, which was conducted by the Zagreb-based Institute of Economics, show that a score of Croatian gaming companies employ some 250 employees, and they export their products worldwide.

Gamepires/Pandora Studio executive Andrej Levenski was quoted as saying that companies specialised in the production of computer games practically export all what they produce.

This company has so far sold 1.5 million copies of its games. However, the biggest challenge affecting the financial results is that Croatia has no agreement with the USA on double taxation avoidance, according to Levenski.

More news about relations between Croatia and the USA can be found in the Politics section.

Saturday, 3 August 2019

US General Attending Events Marking Operation Storm Anniversary

ZAGREB, August 3, 2019 - US General Sandra Best, the Chief-of-Staff of the Minnesota Air National Guard, will attend events marking the 24th anniversary of the Croatian military and police operation Storm as part of her visit to Croatia, to last several days.

The US general on Saturday visited Croatian Air Force units at the "Colonel Mirko Vukušić" barracks at the Zemunik air base near Zadar, where she was informed of the Croatian Air Force's mission and tasks and visited the premises of the Wings of Storm aerobatic team and the Zemunik air base fleet.

One of Gen. Best's hosts, the Croatian Air Force Chief-of-Staff, Brigadier General Michael Križanec, said the very good cooperation between the Croatian Army and the Minnesota National Guard had been going on for more than 20 years.

Križanec said the talks with General Best focused on the continuation and ways of strengthening the cooperation through joint exercises and defence activities.

The Minnesota National Guard is our strong and loyal partner and we appreciate and are grateful for all the support it has offered to help develop the Croatian Army's new capabilities, Križanec said, adding that the two sides would continue developing their cooperation and friendship.

During her stay in Croatia, General Best will also visit the Croatian Navy.

More news about relations between Croatia and the United States can be found in the Politics section.

Monday, 1 July 2019

Visa Regime and Dual Taxation Hamper Croatia-US Cooperation

ZAGREB, July 1, 2019 - The visa regime and the non-existence of an agreement on dual taxation is preventing more intense cooperation between Croatia and the USA, it was heard on Monday at a signing ceremony of a cooperation agreement between the Association of Croatian-American Professionals (ACAP) and the Croatian Exporters (HIZ) association.

The USA could mean a lot more to Croatia in the economic field, however, considering the potential of the two countries, these relations are not as good as we would like them to be, HIZ president Darinko Bago said.

He believes that relations are a lot stronger in some other segments than they are in the economy and finance, underscoring that there are two main reasons for this: the non-existence of a dual taxation agreement and the fact that Croatian citizens require a visa to go to the USA.

Today's agreement provides exporters with yet one more partner to lobby for those problems to be resolved sooner, Bago said.

ACAP's vice president and head of a task force within that organisation working on avoiding dual taxation, Tomislav Krmek, said that ACAP is involved in several activities for an agreement to be signed.

"We are aware that Croatia is the only EU member state that still does not have such an agreement. That presents a big problem to a lot of people, primarily individuals and SMEs who do business between Croatia and the USA, who earn their income in one country and want to return it to their own country," Krmek said.

He said that the task force has prepared a draft dual taxation agreement and a memorandum explaining all the details and steps concerning that agreement, adding that the association has informed several relevant institutions of the arguments in favour of the agreement.

ACAP president Darko Don Markušić said that the association has identified several possibilities for further cooperation with HIZ, emphasising that ACAP intend to connect Croatian-American professionals with Croatian professionals throughout the world.

ACAP was founded in Washington in 2014. It has more than 1,000 members and 15 branches throughout the USA and one in Zagreb. Its members represent all facets of the international professional community, such as scientists, doctors, engineers, attorneys, artists, journalists, business executives, accountants, etc.

Markušić announced a conference that will be held in Cleveland in September where the Zagreb branch will present a panel discussion on business cooperation with Croatian war veterans.

More news about relations between Croatia and the United States can be found in the Politics section.

Tuesday, 25 June 2019

State Department: Croatia Faced with Rise in Religious Intolerance

ZAGREB, June 25, 2019 - The U.S. State Department says in its annual report on religious freedoms worldwide that an increase in religious intolerance, particularly online was perceived in Croatia in 2018.

"The Council of Europe and the national ombudsperson reported an increase in religious intolerance, particularly online," reads the report's section on Croatia.

"In May, the Council of Europe released a report saying religious intolerance, including pro-Ustasha graffiti and online speech, were on the rise in the country.

"Minority religious communities reported occasional instances of verbal harassment and physical assault, including of religious workers.

"The ombudsperson’s report said comments on various online portals accused Jews of undermining democracy, freedom, and financial institutions," reads the report.

The paper also notes that Croatia's Constitution provides for freedom of religious thought and expression and prohibits incitement of religious hatred. All religious communities have the same religious protections under the law, and are free to worship, proselytize, own property, and import religious literature."

The U.S. government estimates the country's total population to be 4.3 million (July 2018 estimate). According to the 2011 census, 86.3 percent of the population is Catholic, 4.4 percent Serbian Orthodox, and 1.5 percent Muslim. Nearly 4 percent self-identify as nonreligious or atheist. Other religious groups include Jews, Protestants, and other Christians. According to the Coordination of Jewish Communities in Croatia, there are between 2,000 and 2,500 Jews.

There are 54 registered religious communities. Besides the Catholic Church, 19 religious communities have agreements with the state.

"Nongovernmental organizations (NGOs) and international organizations reported instances of border police subjecting migrants to treatment inconsistent with their religious beliefs. The government denied these reports."

Atheist and Jewish organizations complained that non-Catholic children were discriminated against in public schools.

On the other hand, leaders of the Islamic community reported overall good relations with the government.

"Following an April meeting with Prime Minister Andrej Plenković, Metropolitan Porfirije Perić, leader of the SOC (Serb Orthodox Church), publicly stated he was satisfied with the legal status of the Church.

"According to the Office of the Commission for Relations with Religious Communities, the government budgeted 288.2 million kuna (45.67 million dollars) during the year for the Catholic Church for salaries, pensions, and other purposes, compared with 299.5 million kuna (47.46 million dollars) in 2017.

"The government offered funding to other religious communities that had concluded agreements with the state, a portion of which was based on their size, in addition to funds provided to support religious education in public schools, as well as the operation of private religious schools. The government provided 21.4 million kuna (3.39 million dollars) to these groups," reads the report.

The State Department released its annual report on religious freedoms across the world last week.

This annual Report to Congress on International Religious Freedom – the International Religious Freedom Report – describes the status of religious freedom in every country.

The paper covers government policies violating religious belief and practices of groups, religious denominations and individuals, and U.S. policies to promote religious freedom around the world. The U.S. Department of State submits the reports in accordance with the International Religious Freedom Act of 1998.

U.S. embassies prepare the initial drafts of country chapters based on information from government officials, religious groups, nongovernmental organizations, journalists, human rights monitors, academics, media, and others.

More news about religion in Croatia can be found in the Lifestyle section.

Friday, 21 June 2019

USA: Croatia Fails to Meet Standards for Elimination of Human Trafficking

ZAGREB, June 21, 2019 - The U.S. State Department has issued a report on human trafficking in 2019 which says that Croatia does not fully meet the minimum standards for the elimination of trafficking but is making significant efforts to do so.

The latest "Trafficking in Persons Report", however, praises the Croatian government for demonstrating "overall increasing efforts compared to the previous reporting period; therefore, Croatia remained on Tier 2." The countries are grouped in three tiers.

As for the Croatian efforts to counter human trafficking the report reads that they "included investigating, prosecuting, and convicting more traffickers and identifying more victims, particularly victims of forced criminality."

"The government conducted operations to proactively screen for trafficking indicators, increased funding to NGO-run shelters, and adopted the 2018-2021 national action plan."

"However, the government did not meet the minimum standards in several key areas," reads the report.

"Despite conducting operations to proactively identify victims, the government did not consistently screen migrants and asylum seekers, and alleged police abuse strongly discouraged victims within this population from cooperating or self-identifying.

"Judges continued to issue light sentences and dismissed victim testimony as unreliable due to a lack of understanding of trafficking, while a large backlog of criminal cases caused long delays and police experienced difficulties in encouraging victims to cooperate with investigations.

Croatia is advised to "institutionalize and implement screening procedures for migrant flows, including asylum seekers and unaccompanied minors."

Zagreb is urged to "increase capacity and training to accurately screen for victims and consistently implement screening procedures for vulnerable populations, particularly migrants, refugees, asylum seekers, seasonal workers, and Roma."

One of recommendations is to "vigorously investigate, prosecute, and convict traffickers, and impose strong sentences."

Judges are supposed to be trained at all levels of the judiciary to understand the severity of trafficking when issuing sentences, and sensitize judges to the issue of secondary trauma.

As for other countries in the region, Serbia is also included in the Tier 2 group, whereas Montenegro and Bosnia and Herzegovina fall into the group labelled "Watch List".

Bosnia and Herzegovina's authorities are criticised for failing to show additional efforts to address this issue.

The State Department underscores that "human trafficking is one of the most heinous crimes on Earth."

"Right now, traffickers are robbing a staggering 24.9 million people of their freedom and basic human dignity—that’s roughly three times the population of New York City. We must band together and build momentum to defeat human trafficking. We must hold the perpetrators of this heinous crime accountable. We must achieve justice for survivors as they rebuild their lives. We must reinvigorate our shared commitment to extinguish human trafficking wherever it exists. There is no time to waste," the Secretary of State, Michael R. Pompeo, was quoted as saying.

More news about relations between Croatia and the United States can be found in the Politics section.

Thursday, 13 June 2019

United States Donate Two Vans to Croatia to Detect Hazardous material

ZAGREB, June 13, 2019 - Interior Minister Davor Božinović on Wednesday signed a grant agreement with United States Ambassador William Robert Kohorst setting out the conditions for the U.S. donation of two vans with top-notch equipment for the early and efficient detection of hazardous substances.

According to the agreement, the USA will donate the two vans with equipment for the early and efficient detection of hazardous substances including chemical, biological, radioactive and nuclear material.

The document also defines conditions for cooperation between Croatia's Interior Ministry and the US Department of Energy regarding the prevention of illegal trade of nuclear and other radioactive substances, the Interior Ministry has reported.

The US will also conduct training courses in the use of that equipment which will improve the capacities of Croatia's police in combating that form of smuggling, the Interior Ministry said in a press release.

The value of the donation which will be implemented by the end of the year is about $ 400,000.

The ministry said that over the past two years it had developed cooperation in different security areas - combating terrorism, crackdown on smuggling rings, suppressing organised and grave crime and all with the aim of developing capacities and better exchange of information to facilitate effective responses to contemporary security challenges.

More news about relations between Croatia and the United States can be found in the Politics section.

Saturday, 8 June 2019

US Ambassador Donates Rescue Equipment to Civil Protection Directorate

ZAGREB, June 8, 2019 - US Ambassador William R. Kohorst on Friday handed over rescue equipment to Croatia's Civil Protection Directorate worth 170,000 dollars, as a donation from the US European Command.

The donation is yet another example of the excellent US-Croatia cooperation and it is especially important because this is humanitarian equipment that will help in providing security for Croatian citizens, Kohorst said.

Thanking the US ambassador for the donation, Minister of the Interior Davor Božinović said that the cooperation between the two countries was traditionally good and was being constantly advanced.

Civil protection is an area with great potential in the US-Croatia cooperation. The newly donated equipment is very valuable and builds on previous donations. The newly donated sensors for search and rescue operations in collapsed structures are state-of-the-art equipment for which we are very grateful to the USA, Božinović said.

More news about relations between Croatia and the United States ca ne found in the Politics section.

Wednesday, 5 June 2019

US Secretary of Energy: LNG Terminal in Croatia Will Be Profitable

ZAGREB, June 5, 2019 - New gas sources in Southeast Europe, such as potential exploitation in the Romanian Black Sea, do not endanger the profitability of building an LNG terminal at Krk island, Croatia as the demand for this energy source will only grow, while its price will fall, US Secretary of Energy Rick Perry said in Ljubljana on Wednesday.

Croatia's Večernji List daily said recently the potential exploitation of gas in the Romanian part of the Black Sea, in which the US company ExxonMobil has the lead role, would make the already modest capacities of the LNG terminal in Croatia irrelevant for the broader region.

The paper also said that Hungarian Prime Minister Viktor Orban, whose country has submitted a bid for a 25% stake in the Croatian LNG project, said upon returning from Washington that the US project in Romania had been the "first and most important topic" of his talks with President Donald Trump.

Critics of the construction of the LNG terminal in Croatia also note that the 20 or so such terminals already existing in Europe work at 25% capacity.

I think those arguments are not legitimate, said Perry, who arrived in Slovenia to attend a Three Seas Initiative summit. You will need much more gas than we will be able to deliver, he said, adding that the appetite for cleaner energy sources was increasing in Europe.

If Europe wants an economic transition, it will need more energy, Perry said, adding that Germany planned to abandon nuclear energy.

Either the lights will go out or they will use LNG. There is no third option, he said about Germany, adding that the US supported the construction of the Krk terminal. Not necessarily for the purchase of US gas, he said, but because more routes and suppliers are a good formula for Europe which cannot be free and sovereign if it depends only on Russian gas.

Russia currently sells gas at a lower price, but Perry said the price of US gas was constantly falling, that this would continue and that US natural gas reserves were massive.

He also said climate change could not be fought without nuclear energy free of harmful emissions. He announced a forum for next month between the European Commission and his department on Small modular reactors.

A panel discussion on energy on Wednesday afternoon marked the start of a business forum in Ljubljana, which is being held parallel to a summit of leaders of countries participating in the Three Seas Initiative, the largest international event held in Slovenia over the past decade with more than 600 participants from some 40 countries, including Croatia's President Kolinda Grabar-Kitarović.

Opening the business forum, Slovenia's Prime Minister Marjan Šarec said that only better connectivity in Europe, not just north-south but east-west as well, can secure a better and more successful future for new generations. Investment and cohesion funds that would be used for better digital and energy connectivity of Central and East Europe would also benefit the Western part of the continent.

Croatia's delegation in the energy panel included Environment and Energy Minister Tomislav Ćorić and an executive at the national electricity provider HEP, Robert Krklec.

Ćorić said that within the framework of the Three Seas Initiative, Croatia is focused on diversifying sources and routes of energy procurement. He also spoke about plans for the construction of an LNG terminal on the island of Krk, which should be operational in 2021.

US Secretary of Energy Rick Perry, who had met with Slovenia's President Borut Pahor and Prime Minister Šarec earlier in the day, attended the energy panel too.

There seemed to be some divergence of opinion between Perry, who said he was speaking on behalf of US President Donald Trump, and Miguel Berger from the German Economy Ministry concerning the Russian-German South Stream II gas pipeline and the EU's independence from Russia for energy supply.

Berger said that Germany supports the construction of an LNG terminal on Krk island, Croatia and that gas be imported from the USA as a means of diversifying supply routes, but that that has to be based on market principles. He also dismissed US claims that South Stream II jeopardises Europe's energy independence.

More LNG terminal news can be found in the Business section.


Monday, 27 May 2019

U.S. Ambassador: Croatia Should Improve Judiciary and Tax System

ZAGREB, May 27, 2019 - U.S. Ambassador to Croatia, Robert Kohorst, said on Monday that Croatia was on the right track, however, it should upgrade its judiciary and tax system and reduce excessive red tape.

During his lecture at the Zagreb School of Economics and Management (ZSEM) within the International Consulting Project, the U.S. Ambassador, who addressed a group of foreign students, said that there was a lot of similarities between Croatia and his country, however, he underscored that the capitalist system in the U.S.A was more developed.

He said that risks for doing business in Croatia were connected with excessive red tape, insufficiently transparent and slow judicial system and occasional arbitrariness in the tax system.

The ambassador praised the current Croatian government for detecting those problems and starting to eliminate them.

The diplomat notes that about 100 U.S. companies are doing business in Croatia, highlighting IBM and Microsoft.

As for deficiencies in the tax system, Kohorst pointed to absence of property tax, which he finds to be wrong, given that there are many properties whose ownership structure is not clear and they are in a dilapidated condition.

In that context he cited the tourist sector where unsettled ownership rights prevent the construction of golf course facilities or the expansion of hotel capacities.

Kohorst also mentioned successful local companies: Rimac Automobili, Adris, Atlantic Grupa and Podravka.

Kohorst believes that the biggest difference between Croatia and the USA is in optimism, or rather the lack of it, and considers that Croatians are significantly more pessimistic.

The dominant attitude in the USA is that if I work hard and with dedication, I can succeed, and even if that doesn't happen, I will try again and optimism, regarding the view of the future and opportunities, prevails, Kohorst explained.

Kohorst noted that security is Croatia's advantage and that it in that sense, it is a forerunner in the region, followed by the stability of the government, educated labour force and its membership to the EU.

There are a lot of reasons why companies should come and do business in Croatia and expand their market, Kohorst said however he believes that it is necessary to take that last step and that people and youth have to truly believe that they want to stay and build their country.

More news about relations between Croatia and the United States can be found in the Politics section.

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