Croatia
Answer ... Investment restrictions and allowed investments are discussed in the Ordinance on the Types of Alternative Investment Funds (AIFs). Investment restrictions in general determine the maximum percentage of net value of the AIF’s assets that must be invested in certain assets and/or instruments. Special rules govern restrictions with respect to:
- index replication;
- securities or financial market instruments issued or guaranteed by public bodies;
- shares or units of investment funds; and
- the prevention of a significant impact on investors.
Different criteria apply depending on the type of AIF.
With regard to private equity, at least 70% of the AIF’s assets must be invested in equity or equity-like interests, while no more than 30% can be invested in other assets. The AIFM can borrow and issue debt securities or guarantees only if the types and restrictions thereof are prescribed by the AIF’s rules.
With respect to venture capital, at least 70% of the AIF’s assets must be invested in:
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equity or equity-like instruments issued by entities that fulfil certain conditions prescribed in the ordinance;
- secured or unsecured loans issued by AIFs to entities (provided that these do not exceed 30% of the AIF’s value);
- company shares acquired by existing shareholders; and
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shares of other venture capital AIFs (provided that those AIFs themselves have not invested more than 10% of their capital in other venture capital AIFs).
At least 70% of the net value of specialised AIFs must be invested in the specific area determined as the object of the AIF’s investments.
Croatia
Answer ... There are no specific rules in the legislative and regulatory provisions governing AIFs. However, when making a particular investment, the rules applicable to the respective assets must be observed.