Controlled foreign company rule (implementation of ATAD 1 from 2019)  Croatian Tax Administration shall treat an entity, or a permanent establishment of which the profits are not subject to tax or are exempt from tax in other Member State of the EU, as a controlled foreign company where the following conditions are met: (a) in the case of an entity, the taxpayer by itself, or together with its associated enterprises holds a direct or indirect participation of more than 50 percent of the voting rights, or owns directly or indirectly more than 50 percent of capital or is entitled to receive more than 50 percent of the profits of that entity;