The government on Thursday submitted the final proposal of the new law on strategic investment projects to parliamentary procedure, aimed at accelerating the process of obtaining the documentation necessary for the realization of strategic investment projects, which has also halved the investment value criterion from 150 to 75 million kuna.
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Deputy Prime Minister and Minister of Economy, Entrepreneurship and Crafts Martina Dalić emphasized that the aim of the law is to simplify the procedure provided by the law, especially concerning private investment projects. The previous application of the existing law has shown that there is a misunderstanding of certain provisions in implementation, certain legal-technical deficiencies, and the complexity of prescribed procedures has proven to be an obstacle, and the new law aims to simplify and accelerate the preparation processes for investment projects, said Dalić.
The existing law has been in force since 2013 and has been amended twice in the meantime. Since the application of the existing law, 29 strategic investment projects have been included on the list, of which 13 have been added in just over a year.
Dalić noted as a novelty of the law the reduction of the financial limit or investment value criterion for a project to be declared strategic from the current 150 million kuna to 75 million kuna, and for projects realized in supported areas, islands, and those from the field of agricultural production, fisheries, and forestry from 20 to 10 million kuna.
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The amendment also relates to proof of secured sources of financing – now the investor must prove that they have 10 percent of the total project value in a term deposit or bank guarantee, and with the proposal of the new law, this amount is reduced to 5 percent. This proof can be submitted either in the form of a dedicated deposit, a letter of intent from the bank to finance the project, and funds that the investor has already invested in the realization of the project will also be recognized as proof of secured sources of financing.
This amendment is important to make the entire procedure more attractive for private projects.
Dalić emphasized that in practice this provision has proven to be a significant obstacle for private projects given that it involves relatively large amounts.
It is also proposed to redefine the disposal of real estate in state ownership, such as forests, agricultural land, public roads, etc.
According to the existing law, the government disposed of real estate in state ownership without public bidding and public collection of offers for the implementation of public strategic projects, and now the government would dispose of real estate for the implementation of private strategic projects according to the same principle. In this case, the private investor must own at least 50 percent of the land for the realization of the project, and if they lack the remaining maximum of 50 percent for the formation of a building plot, they can obtain that plot from the government without a public tender or through direct agreement. If they need state land that constitutes more than 50 percent of the project, such land can only be allocated through a public tender, explains Dalić.
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The obligation to sign an agreement with the investor on the implementation of the strategic project is also introduced, which would be signed before the project is declared strategic, to provide investors with greater security.
According to the new law, energy investment projects that are already on the list of strategic projects of common interest at the EU level, as well as projects financed from European structural and investment funds, would be directly included on the list of strategic investment projects.
One of the novelties is the introduction of a penalty of 0.1 percent of the project value if the investor exceeds the deadline for realization due to their fault or withdraws from the project after completion without valid reason.
“No investment project will be declared strategic if it is not in accordance with the valid spatial plans,” emphasized the Deputy Prime Minister and Minister of Economy, adding that the law stipulates that all projects declared strategic will be processed through an expedited administrative procedure.
