Tihomir Duplic
Partner

Tihomir Duplić is a partner at Duplić Strukić Šarić Law Firm with extensive experience in shipping, maritime, and transport law, as well as aviation, finance, and international commerce. He advises clients on ship arrests, ship finance and registration, marine insurance, P&I, yachting, shipbuilding, maritime casualties, and carriage of goods by sea, oil and gas, providing practical, business-minded legal support aligned with clients’ objectives. Tihomir holds a law degree from the University of Zagreb and has completed specialised maritime training at Lloyd’s Maritime Academy, bringing in-depth industry knowledge to each engagement. He has developed strong working relationships with shipowners, insurers, shipyards, and financial institutions, delivering clear, strategic advice across sectors. Tihomir is a member of the Croatian Bar Association and Croatian Maritime Law Association and lectures on legal aspects of nautical tourism at University College Aspira in Split, sharing his expertise with future professionals in the maritime sector.

Martina Strukić Šarić
Partner

Martina Strukić Šarić is a partner at Duplić Strukić Šarić Law Firm with over 15 years of experience in corporate, commercial, real estate, energy, M&A, and maritime law. She advises clients on mergers and acquisitions, joint ventures, complex real estate transactions, and renewable energy projects, ensuring practical, business-oriented solutions that align with clients’ goals. Martina also handles maritime matters, including ship arrests and marine insurance, providing clear, strategic guidance across sectors. She holds a law degree from the University of Zagreb and is a certified court interpreter for English, fluent in French and Russian, with working knowledge of German and Spanish, allowing her to effectively support international clients. Martina is valued for her client-focused approach, strong negotiation skills, and ability to navigate complex legal challenges with precision. Her commitment to aligning legal strategies with business objectives has earned her the trust of leading Croatian and international clients across industries.

Ship Arrest in Croatia: From Urgent Security to Effective Recovery

For a lender, the value of a ship mortgage is ultimately measured at enforcement. Its practical strength depends on whether the vessel can be located, prevented from sailing and converted into recoverable value before competing claims and operating costs consume the equity. Ship arrest is therefore not simply a litigation remedy. In a distressed credit, it often preserves the lender’s negotiating position and prevents a mobile asset from leaving the jurisdiction.

Croatia is particularly relevant in that context. Its ports, shipyards and marinas regularly receive foreign-flagged commercial vessels and yachts, while its courts operate within a developed framework shaped by the 1952 Brussels Arrest Convention, the Croatian Maritime Code and general enforcement rules. A properly prepared arrest can often be obtained within one working day. That speed is commercially valuable, but arrest is only the beginning of recovery. Decisions taken before filing will often determine whether it produces security, payment or a judicial sale.

Arrest is security, not satisfaction

Under Croatian law, arrest takes the form of a temporary measure prohibiting the vessel from leaving port. It does not determine the merits of the claim and it does not, by itself, entitle the claimant to payment. Its immediate purpose is to preserve the asset or to compel the provision of substitute security while the substantive claim or enforcement proceeds in the competent forum.

That distinction matters in finance transactions. A bank may have an acceleration notice, a first-ranking mortgage and a quantified debt, but still face three separate questions: whether the claim qualifies for arrest in Croatia, whether the correct vessel is available for arrest, and whether the documents permit immediate enforcement or require a judgment or award first. Treating those questions as interchangeable causes delay.

The legal gateway: the Convention and the Maritime Code

Croatia is a contracting state to the 1952 Brussels Convention for the Unification of Certain Rules relating to the Arrest of Seagoing Ships. Where the Convention applies, a vessel flying the flag of another contracting state may be arrested only for a maritime claim within the Convention’s scope. Where the Convention does not apply, the Croatian Maritime Code governs, including its reciprocity rule for foreign vessels.

The Croatian list of arrestable claims is broad and commercially familiar. It includes collision damage, personal injury, salvage, contracts for the use of a vessel, general average, towage, pilotage, operational supplies and services, construction and repair, crew claims, disbursements, brokerage and agency fees, and port, canal and dock charges. Arrest is also available to enforce a maritime lien, ship mortgage or comparable foreign-law security right.

For banks, the last category is decisive. A mortgage claim is not forced into the same analysis as an ordinary unsecured trade debt. However, the claimant must still establish, at least on a prima facie basis, the existence of the secured claim, the mortgage and the event of default. The court will not reconstruct a financing transaction from incomplete extracts or assume that a payment default automatically triggered acceleration under the governing documents.

Identifying the right debtor and the right ship

The ownership analysis must be completed before the application is filed. For most maritime claims under the Maritime Code, a vessel owned by the personal debtor at the time of filing may be arrested, which creates scope for a sister-ship arrest. The personal debtor is the person liable for the claim.

The rule is narrower for claims secured by a maritime lien or mortgage, and for ownership claims. In those cases, the arrest attaches to the particular vessel affected by the right. A mortgaged vessel may remain arrestable while the mortgage continues to encumber it even if ownership has changed, but the mortgage does not provide a basis for arresting an unrelated vessel in the same group.

Group charts, beneficial ownership information and commercial branding are therefore not enough. The court will look to registered ownership and the legal identity of the debtor.

What a lender should have ready before the vessel arrives

An effective arrest application should be prepared as part of enforcement planning, not assembled after AIS shows the vessel approaching a Croatian port. The core package will normally include the mortgage deed and covenants, relevant facility and security provisions, evidence of registration and priority, default and acceleration notices, and a lender-issued statement of account showing principal, interest and costs.

Corporate authority is equally important. Croatian lawyers require a power of attorney executed by an authorised signatory and evidence of that authority. Where a security agent or trustee acts for a syndicate, the documents must show why it may enforce in its own name. Any transfer, novation or amendment of the mortgage must be documented through a complete chain of title.

All documents filed with the court must be accompanied by a Croatian translation prepared by a sworn court interpreter. In urgent cases, translation is often the critical path. Banks that maintain an enforcement set of key documents, already translated or capable of immediate certification, are in a materially better position than lenders that first need to locate final signed versions across several deal platforms and jurisdictions.

The vessel’s current position must also be verified. Before substantive proceedings have begun, territorial jurisdiction generally follows the place where the vessel is located when the arrest application is filed. A technically strong application submitted to the wrong court is of little use if the vessel sails while the file is being transferred or corrected.

The evidentiary threshold and the importance of timing

The claimant must make the existence of its claim probable and show a risk that recovery will be prevented or materially hindered without the measure. Under Croatian enforcement law, that risk is presumed where the claim would have to be pursued abroad. This frequently assists a foreign lender proceeding against a foreign shipowning company, but it does not remove the need to establish the claim itself or its maritime character.

Croatian courts may determine the application without first hearing the owner. In a complete case, the vessel may be stopped within a working day. The practical variables are the evidence, identification of vessel and debtor, translations and confirmation that the ship remains within the court’s reach.

Once the arrest is granted before proceedings on the merits or enforcement have been commenced, the claimant must prove within 15 days that it has commenced the appropriate litigation, enforcement or other underlying proceeding before the competent forum. If it fails to do so, the owner may seek discharge of the arrest. The merits forum may be Croatia, but it may equally be a foreign court or arbitral tribunal selected in the finance documents. The arrest strategy must therefore be coordinated with the dispute resolution clause from the outset.

Release against security: often the commercial objective

Most arrests do not end in judicial sale. The vessel’s earning capacity gives the owner, charterer and insurers a strong incentive to arrange release. Croatian law permits the court to release the vessel where security acceptable to the claimant is provided, or, if the claimant refuses the proposed security, where the court determines that the security is sufficiently reliable and covers the claim together with interest and procedural costs. Security may take the form of a cash deposit, bank guarantee, P&I club or other insurer’s undertaking, or another transferable asset. Where liability may be limited, the security need not exceed the applicable limitation amount.

Providing security is not an admission of liability and does not waive a right to limit liability. It may convert a mobile, depreciating asset into a more manageable claim against a bank, insurer or cash deposit. The wording, governing law, expiry and payment triggers of substitute security deserve the same attention as the arrest itself.

Counter-security is not automatically required. The owner may ask the court to order security for losses resulting from the measure, and the court has discretion to do so. Croatian law also recognises liability for damage caused by an arrest later found unfounded or not duly justified. Arrest should not be used solely as pressure where the claim, debtor identity or mortgage enforceability remains uncertain.

From arrest to enforcement: the document must do the work

For a Croatian mortgage, the shortest route to recovery is created at the drafting stage. If the mortgage agreement bears the debtor’s notarised signature and contains both an express consent to registration and an express consent to direct enforcement after maturity, it can constitute an enforceable instrument under the Maritime Code. The mortgagee may then seek judicial sale without first bringing a full action to establish the debt.

The position must be examined more carefully where the vessel and mortgage are registered abroad and the security documents are governed by foreign law. Registration of a mortgage proves the existence and priority of the security, but it does not necessarily make every underlying covenant directly enforceable before a Croatian court. Depending on the governing law and wording of the instrument, the lender may first need a judgment in the agreed jurisdiction or an arbitral award, followed by the steps required for enforcement in Croatia.

This is a material credit point. Strong substantive rights without an efficient route to an enforceable title can add months to recovery. At origination or refinancing, lenders should test the mortgage and covenants against likely enforcement jurisdictions, not only the flag state, and consider a parallel locally enforceable instrument.

Judicial sale and the real priority waterfall

Once sale is ordered, the court records the enforcement, secures the vessel, appoints a maritime expert to determine market value and sets the terms. Sale is generally by oral public auction, although a private sale may be agreed within the statutory framework. The first auction cannot ordinarily conclude below one half of the determined value; a second may proceed down to one third. Bidders normally provide security equal to one tenth of that value, subject to exemptions for the enforcing creditor and adequately covered secured creditors.

The economic outcome depends less on the mortgage’s label than on the claims ranking ahead of it. Costs incurred in the sale and preservation of the vessel are paid first. The statutory order then places certain public or wreck-related liens, maritime liens, possessory claims and only then ship mortgages ahead of unsecured creditors. Maritime liens may include crew wages and repatriation costs, death and personal injury claims, salvage, port and pilotage charges, and certain non-contractual damage claims. A shipbuilder or repairer retaining possession may also have a priority right of retention.

In an international case, the law of the flag may be relevant to determining whether a claim constitutes a maritime lien, while Croatian law governs the procedural order of distribution. This can expose a mortgagee to claims that were never visible in the registry. Pre-enforcement diligence should therefore go beyond a mortgage transcript. Crew arrears, port and marina accounts, recent casualties, salvage events, repair yard possession and unpaid operating expenses can all affect the recovery analysis.

The arresting creditor may have to advance custody, maintenance, crew or valuation costs. Those amounts are generally recoverable with priority, but create a liquidity requirement during the case. Four to six months for an uncomplicated Croatian judicial sale is achievable, although objections, foreign service, ranking disputes, deterioration or a failed first auction can extend the timetable.

It is not necessary under the laws of Croatia (i) in order to enable the Lender to enforce his rights under the mortgage agreement or (ii) by reason of the execution, delivery and performance of the mortgage agreement that the lender be licensed, qualified or otherwise entitled to carry on business in Croatia.

Any moneys payable under or in connection with the mortgage agreement and the proceeds of any judgment obtained in respect of the mortgage agreement in the courts of Croatia may be remitted out of Croatia without limit or restriction and without the need to obtain any consent, permit, licence, approval, authorisation or exemption from any person.

The purchaser will normally acquire the vessel free of existing registered encumbrances, which are deleted through the court process. That clean-title effect is essential to attracting bidders. Its recognition outside the state of sale, however, has historically depended on domestic law and conflict-of-laws rules. This is precisely the issue addressed by the Beijing Convention on the Judicial Sale of Ships.

The Beijing Convention: important for the exit, not the arrest

The United Nations Convention on the International Effects of Judicial Sales of Ships entered into force internationally on 17 February 2026. It does not harmonise arrest law, determine creditor priorities or replace domestic sale procedures. Its function begins later: where a judicial sale confers clean title under the law of the state of sale and the Convention’s notice requirements are met, that effect should be recognised in other contracting states.

The Convention introduces a standardised certificate of judicial sale, notice requirements for owners, registries and known secured creditors, and a framework for deleting existing charges and registering the purchaser. It also protects the purchaser against later arrest for claims extinguished by the sale. For financiers, this should reduce title risk, broaden the bidder pool and improve recoveries throughout the creditor waterfall.

The position in Croatia requires precision. Croatia signed the Convention on 19 June 2024 but, as at 17 August 2026, has not deposited its own instrument of ratification. The European Union signed on 14 March 2024 and deposited its approval on 18 June 2026; the Convention will enter into force for the EU on 15 December 2026. That EU approval is limited to matters within the Union’s exclusive competence, principally aspects of notice and service under Article 4 and jurisdiction under Article 9. Member States retain competence over the Convention’s remaining core matters and their own decision whether to ratify them. Accordingly, the Convention cannot yet be described as fully operative in Croatia as a complete domestic clean-title regime.

Even before Croatian ratification, the Convention sets a useful benchmark for sale notices, identification of mortgagees and preservation of the procedural record. Courts and creditors that follow those standards will be better placed to defend the sale internationally and to maximise bidder confidence.

Conclusion: enforcement readiness begins at closing

Croatia offers a credible and comparatively fast forum for arresting commercial vessels and yachts. Its legal framework can provide rapid security, release against a bank or insurer’s undertaking, and a structured route to judicial sale. Yet speed at the arrest stage does not cure weaknesses in the underlying finance documents or gaps in the lender’s evidence.

The practical lesson is straightforward. Mortgage enforceability, debtor identity, dispute resolution, translated documents and likely priority claims should be reviewed before distress becomes visible. A lender that knows where it will sue, what it must file and which claims may outrank it can use arrest as part of a controlled recovery strategy. Starting that analysis only after the vessel reaches port may be too late.