There is a high risk of encountering corruption in the Croatian judiciary. Businesses perceive that irregular payments and bribes in return for favorable judicial decisions do occur (GCR 2015-2016). Businesses express low levels of confidence in the judiciary’s independence and very low levels of trust in the efficiency of the legal framework in relation to settling disputes and challenging regulations (GCR 2017-2018). The long duration of proceedings, the possibility of political influence on judicial officials, and the possibility of bias in decisions of judges all lead to low levels of trust in courts and prosecutors (GRECO 2016). One in ten surveyed judges reported having been under inappropriate pressure to decide a case in a certain way (ENCJ 2017). About two out of five judges believe that appointments within the institution are made on the basis on factors other than experience and merit; more than half of judges believe the same regarding promotions (ENCJ 2017). The inefficient and at times unpredictable legal system is one of the greatest challenges facing companies seeking to invest in Croatia (ICS 2017). Even simple matters can take a long time to resolve, due to the courts’ backlog of several hundreds of thousand cases (ICS 2017). The judiciary has general and specialized courts, including four courts responsible for adjudicating corruption and organized crime cases in Zagreb, Rijeka, Split, and Osijek. The cases receive high priority in the justice system (ICS 2017). Croatia recognizes binding international arbitration, which may be included in investment agreements (ICS 2017). Enforcing a contract in Croatia takes longer than the regional average, but the costs involved are significantly lower (DB 2017).
In 2016, the Security and Intelligence Agency (SOA) identified twenty judges who posed a potential threat to national security and were believed to be engaged in potentially corrupt practices (NiT 2017). The judges were not named, and the report was largely ignored (NiT 2017). In a bid to downplay the report, the Minister of Justice suggested that this indicates that corruption in the judiciary is only a minor problem (NiT 2017). The report was released in the context of several allegations of inappropriate contacts between judges, including some belonging to the Constitutional Court, and parties with a stake in the cases (NiT 2017).
Croatia has signed the New York Convention of 1958 and is party to the International Center for the Settlement of Investment Disputes (ICSID).