Croatia has made great strides in strengthening its regulatory policy framework. Improving
the entire regulatory policy cycle will ensure that regulations are built on a foundation
of solid evidence and public participation and are designed to improve the security,
health and well-being of citizens at a reasonable cost. This report assesses the country’s
regulatory management capacity by taking stock of regulatory policies, institutions
and tools, including administrative simplification policies, ex ante and ex post evaluation
of regulations, stakeholder engagement practices, multi-level regulatory governance
arrangements and tax regimes for small businesses. The review describes trends and
recent developments, identifies gaps in relation to good practices and offers policy
recommendations based on best international practices to strengthen the government’s
capacity to manage regulatory policy.
This document was produced with the financial assistance of the European Union. The views expressed herein can in no way be taken to reflect the official opinion of the European Union.
The Government of Croatia has introduced a set of useful and important reforms to strengthen regulatory policy, including a legislative framework for Regulatory Impact Assessment (RIA) and stakeholder engagement. A whole-of-government policy bringing together these provisions is still missing.
Implementation of regulatory policy remains a challenge. A lack of analytical capacities for regulatory quality in the Government Legislation Office and line ministries compromises the quality of regulatory management tools.
A number of line ministries, centre-of-government offices and other institutions are involved in regulatory policy oversight. The Government Legislation Office is well-situated at the centre of government. However, the GLO’s mandate allows for scrutiny of RIA for primary legislation only. As a result, high burdens stemming from subordinate regulations go unchecked.
All the necessary elements of RIA exist for primary laws in Croatia. RIA starts relatively early in the process and looks at a wide variety of impacts. However, policy makers have not used RIA to its full potential in part due to a lack of expertise and the actual information provided in RIAs seems to be relatively underdeveloped.
The government should relaunch Better Regulation to bring evidence-based policy back into focus. At the core of this effort should be the introduction of an explicit and binding whole-of-government regulatory policy with clearly identified objectives and a clear communication strategy.
The scope of better regulation efforts should be extended by moving beyond the current focus on administrative burden measurement and reduction to the effective implementation of regulatory management tools. A central part of this effort is the promotion of analytical capacities in line ministries, for example by further investing in targeted staff trainings.
The Government of Croatia should promote oversight and quality control of regulatory management tools. The Ministry of the Economy could consider extending the scope of its scrutiny to regulatory costs other than administrative burdens to address the substantial burdens stemming from secondary legislation.
Croatia could improve the quality of RIA by targeting RIA and analytical resources to those major legislative initiatives that will have a major impact on Croatian citizens. RIA should also be applied to subordinate regulations with significant impacts.