DIRH in 2025 sealed 59 illegal apartments on the coast

While more than 125,000 legal landlords in Croatia regularly pay taxes and contributions to the state, illegal accommodation remains a reality of the tourist season. This represents unfair competition that not only avoids taxes but also undermines guest trust in the market. The State Inspectorate claims that this year they have intensified field activities, especially along the coast, and that the results are visible.

– The Tourist Inspection of the State Inspectorate has conducted inspection oversight of household service providers during this tourist pre-season and season. In the inspection oversight of household service providers – landlords, tourist inspectors primarily determine the legality of service provision, i.e., whether the individual providing accommodation services (landlord) has obtained a decision approving the provision of household hospitality services, which is issued by the competent administrative body in the county or in the City of Zagreb – they stated.

The numbers show that nearly a third of the inspections did not pass without irregularities. By September 1, 320 inspections were conducted in coastal counties, of which 104 revealed unregistered service provision or illegal advertising of accommodation. This means that every third verified advertisement or property lacked documentation, even though it was offered to tourists.

– Against the offenders who provided accommodation services unregistered in the coastal counties, misdemeanor measures were taken based on the Law on the Prohibition and Prevention of Unregistered Activity, with 34 indictments submitted to the competent municipal (misdemeanor) courts for initiating misdemeanor proceedings and the issuance of 70 misdemeanor orders imposing fines totaling €167,287.34 – they said.

Ineffective penalties

What stands out is the fact that penalties do not stop there, and inspectors increasingly propose the confiscation of property benefits obtained illegally.

– We particularly emphasize that property benefits obtained through unregistered provision of household services are confiscated from offenders, and in all 34 cases of submitted indictments to the competent courts, the confiscation of unlawfully obtained property benefits totaling €225,140.00 was proposed, while through 54 issued misdemeanor orders, unlawfully obtained property benefits totaling €81,846.07 were confiscated, thus the total unlawfully obtained benefit established in previous inspection procedures in coastal counties amounts to €306,986.07 – they reported.

In addition to financial penalties and confiscation of earnings, DIRH increasingly resorts to the most radical measure – closing facilities. Sealed apartments and holiday homes should send a clear message that the state will not tolerate unfair competition.

– Furthermore, due to violations of the provisions of the Law on the Prohibition and Prevention of Unregistered Activity, 62 administrative measures prohibiting unregistered provision of household services have been issued in coastal counties, as well as 27 administrative measures prohibiting the advertising of unregistered provision of household services. In this regard, 59 decisions prohibiting unregistered provision of household services in coastal counties were executed by sealing facilities (holiday homes, apartments, and rooms) until the identified deficiencies are rectified or a decision approving the provision of household services is obtained, for a minimum period of 30 days. We note that tourist inspectors continuously conduct controls of the execution of decisions prohibiting unregistered provision of household services, i.e., those executed by sealing facilities – they emphasized.

Although the numbers show that ‘black accommodation’ is still present to a significant extent, the Inspectorate believes that the trend is changing and that effectiveness is greater than last year.

– Compared to the previous season, during this year’s season, the sealing of facilities where unregistered provision of household services was established during inspections has increased, as preventing unregistered provision of household services is one of the key priorities in the work of the tourist inspection – they said.

For legal landlords, who have been promised better control of the gray zone for years, this is just a small signal that the state is trying to protect those who operate according to the rules. However, it remains to be seen whether these results will be sufficiently deterrent to actually reduce the number of ‘black’ apartments or if the penalties are still too low.