In Slovenia, the Commercial Companies Act (“CCA”) specifies the following types of corporations:
All the above-mentioned corporations, with the exception of the silent company, are legal entities. Similar to other jurisdictions, the most common types in Slovenia are the limited liability company and the joint stock company. More and more popular nowadays are Economic Interest Groupings, also recognized as associations with legal entity status by the CCA.
There is no founding capital required apart from Limited liability companies (2.100.000,00 SIT, appox. 9.000 EUR), Joint stock companies: 6.000.000,00 SIT (approx. 26.000 EUR).
Establishing formalities would include notarial deed signed by the founder, excerpt from the court (original or certified/apostiled copy) accompanied by a certified translation in Slovene language. The court registration is a condition for establishment of corporations and for obtaining legal entity status. The entry into the register is of constitutive nature. The members of the Management Board and Supervisory board shall sign a statement that they have not been convicted and no criminal procedure has been initiated against them nor have they been banned from attending to their duties for the period of two years after the finality of the judgment.
A new text of the Industrial Property Act (“IPA”) was adopted in 2001 in order to comply with EU Law and numerous international treaties to which Republic of Slovenia is a party. These include TRIPs, Paris Convention, WIPO Convention, Patent Cooperation Treaty, Hague Agreement, Locarno Agreement, Nice Agreement, Madrid Agreement and Protocol.
Very recently Slovenian Parliament ratified the European Patent Convention, which is applicable as a legal base from December 1, 2002.
The IPA provides for patents, marks and industrial design protection. Since the Slovene legislation is to a great extent harmonized with international rules, the application made according to provision of PCT or EPT would satisfy the formalities. Foreign natural and legal persons must be represented by a patent agent.
In the field of copyright law, the Republic of Slovenia is a party to the Berne Convention, Universal Copyright Convention, WIPO Copyright Treaty as well as many others.
Domestic legislation consists of the Copyright and Related Rights Act (“CRRA”), which is an up to date legislative act, corresponding to the regulation established within the EU and the Council of Europe, and several bylaws. It provides for the conventional protection of works, protection of computer programmes and databases as well as for new economic rights (such as satellite broadcasting and cable retransmission).
The Takeovers Act (in force from 1997) represents a legal base for corporate acquisitions of public joint-stock companies and securities which are traded on the organized securities market. The Act requires an obligatory takeover bid in cases where the acquirer purchases shares exceeding 25 per cent of voting rights. The provisions of the Act regulate also the contents of the takeover bid and the prospectus, prohibited activities of the target management, possible events at successful or unsuccessful bids, competitive bids and possibilities to withdraw from the bid.
The Act provides for a compulsory notification by any person or legal entity who acquires a qualified stake (5 per cent of voting shares) and each subsequent acquisition of 5 per cent is to reported to the Securities Market Agency and the issuer of such securities.
The same rules apply to takeovers by foreign or domestic persons or legal entities.
The competition field is mainly covered by the Prevention of Restriction of Competition Act (“PRCA”), which came into force on July 1, 1999. Although very complex, the PRCA still leaves in place provisions of the old Competition Protection Act from 1993 regarding unfair competition, dumping and subsidized imports and the establishment of the Competition Protection Office (“Office”).
PRCA provides for usual anti-trust regulation including the prohibition of restrictive agreements and abuse of dominant position as well as for the legal base for individual and block exemptions.
PRCA regulates also consolidations, by prescribing compulsory notification of transactions which meets either of the following thresholds
The parties to a transaction must notify the transaction to the Office not more than one week after the conclusion of the agreement or the announcement of the public bid, or acquisition of a controlling interest, whichever occurs first. Notification should be made by the entity/entities acquiring control or jointly by both parties.
The concentration may not be implemented before a clearance decision or the issuing of an order commencing proceedings due to serious doubts. If a serious doubts order is issued, the Office may issue a further order suspending implementation until a decision has been issued. However, in the case of a public bid, implementation is permitted provided the acquirer does not exercise the voting rights attached to the securities or does so only to maintain the full value of those investments and on the basis of an approval granted by the Office.
Among many types of taxes levied in Slovenia we only focus on those of most interest to foreign investors.
Corporate income tax is levied on the taxable profit of private companies at a rate of 25%. The law allows for the deductible of depreciation, investment transactions etc.
Dividend tax is levied on profit gained by dividends received from securities. The issuer is obliged to make an advance tax payments during the tax period at a rate of 25% for Slovene resident and 15% on dividends transferred abroad. The recipient’s tax basis is increased for the amount of dividends received and the advance payment.
Personal income tax applies to incomes of individuals. It covers several types of income including salaries, pensions, property rights and capital gains. The final amount is taxed at progressive rates (17%-50%) and is offset by advance payments made during the tax period. The difference shall be paid by the tax payer or – if negative - reimbursed by the state after each fiscal year.
Value added tax (VAT) is a usual consumption tax, paid by consumers indirectly. A general rate of 20 % and a reduced rate of 8,5% are applied.
According to the provisions of the Foreigners’ Employment and Work Act (“FEWA”), foreigners may be employed in Slovenia on the basis of a work permit. Issue of such is subject to the following conditions:
There are three different types of work permits.
Work permits for management persons differ according to their status within the company. A management person who has concluded a management employment contract may be employed on the basis of an employment permit issued for the time of his term in office. If the manager is not in a contractual relationship with the company, though entitled to represent the company, he/she shall apply for a personal working permit as a self-employed person.
Special provisions of FEWA regulate employment of workers who are temporary sent to branch offices or subsidiaries of the foreign companies in Slovenia. These provisions only apply for persons that are of crucial importance or possess particular knowledge (key personal) but are not part of management (not registered to represent the company). The employer must apply for an employment permit that may be obtained notwithstanding that this might result in exceeding the quota.
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Last modified May 05, 2008
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