Company Law in Slovenia
Company Law in SloveniaUpdated on Wednesday 07th August 2019
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Slovenian businesses are regulated by the Companies Act. The act clearly specifies the rules for all economic and commercial activities in Slovenia. This includes commercial companies, sole proprietors, related parties, and subsidiaries of foreign companies. The Companies Act (ZGD -1) transposes the European Community Directives into the laws of Slovenia that all legal entities must follow. Our team of Slovenian lawyers can provide in-depth assistance on the main regulations prescribed by this act.
Types of companies subject to Company Law in Slovenia
The Companies Act in Slovenia mentions the exact activities that are subject to the country law. Generally, a company has the status of a legal person if it has a profit-oriented market activity. The types of structures that are governed by Company Law in Slovenia are of two types: partnership forms or companies limited by shares. A partnership can be an unlimited company, a limited partnership or sleeping partnership, while a company limited by shares can be a limited liability company, public limited company, or a European public limited-liability.
The mentioned types of companies subject to the Company Law in Slovenia are considered legal entities regardless if their activity is a non-profit one. They can be established by a natural or by legal person. Our team of lawyers in Slovenia can provide legal advice on the characteristics of each company types available in this country.
Method of receiving the status of legal entity in Slovenia
A company obtains the status of legal personality when it is registered into the court register of companies. However, before registration, the law specifies that the relation between the company members will be subject to partnership agreement rules. If prior to the legal registration, one or more persons act on behalf of a company, then the respective person/s has liability for the obligations of the company, with all of its assets.
If you want to open a Slovenian company, our experienced lawyers in Slovenia will guide you through the entire process. Regardless of the type of company you chose to set up in Slovenia, our Slovenian attorneys will assist you on a along run. Please address to us for more information regarding all the laws and regulations of companies within the country.
What is the structure of the Companies Act in Slovenia?
The Companies Act in Slovenia regulates all the aspects that are related to the registration and the proper functioning of a legal entity. As presented above, it defines the types of companies that can be registered here by natural persons and legal entities. The act is created in such a way that includes the European Union’s legislation concerning commercial entities. The Part I of the Slovenian Companies Act is structured as follows:
- • Chapter One – general provisions and definitions that establish the notion of a legal entity;
- • Chapter Two – the legal requirements for selecting a suitable trading name for a local company;
- • Chapter Three – information concerning the necessary steps for setting up a registered office;
- • Chapter Four – the legal representation of a company (who can represent a company and in what conditions);
- • Chapter Five – trade secrets and non-compete obligations of Slovenian companies.
The first part of the Companies Act provides in-depth information on the accounting procedures that have to be implemented by a local business, the obligations to have an annual report, to appoint an auditor (and when this procedure is necessary) and numerous other important matters, which can be detailed by our team of Slovenian lawyers.
What are the regulations for closing down a company in Slovenia?
Since the Companies Act is created to cover all the aspects of a Slovenian business, the act also refers to the procedures that must be followed in the case in which the business has to be closed down due to various reasons. In this sense, investors should observe the provisions of those stipulated under the Section 4 of the Companies Act (referring to the dissolution of a company) and the Section 5 (winding-up). The provisions of the act present the following:
- • a company can be terminated by a notice of one of its members or if a local court requested this procedure;
- • for example, Article 105 stipulates that an unlimited company in Slovenia can be shut down by a resolution of the company’s members;
- • the company may also be dissolved if it reached the expiry date stipulated in its statutory documents;
- • another reason refers to the bankruptcy of the company or to the death of a member;
- • other reasons besides the above mentioned can also apply and our team of Slovenian lawyers can assist with more details.
What is a suitable company name in Slovenia?
Any company that is registered in Slovenia must operate under a specific corporate name, as stipulated by the Article 12. The company’s name must also provide information with regards to the company’s object of activity. A Slovenian business entity may include in its corporate name the word “Slovenia” only if it obtains the approval of the local authorities.
At the same time, it may also include the name of a prominent personality, but in this case it is necessary to obtain the person’s approval or, if the person no longer lives, the company must obtain an approval from the person’s relatives or the local authorities, provided that there are no relatives to address to (Article 16).
What recommends Slovenia as a business destination?
Slovenia has a set of characteristics that makes it an attractive business destination. Our law firm in Slovenia can provide in-depth information on the advantages stipulated by the investment regulations available here; it is also important to know that the Doing Business Report 2019 has revealed the following data on this country:
- • Slovenia ranks as the 40th jurisdiction in the Doing Business Report (from 190 countries);
- • on the ease of doing business, Slovenia has a score of 75.61 (out of 100);
- • Slovenia is the 1st economy at a global level for the index analyzing trading across the borders;
- • it occupies the 9th place for the ability to resolve insolvency cases;
- • it is the 23rd economy on the number of procedures involved in getting electricity;
- • it occupies the 30th rank for the protection of minority investors;
- • regarding the procedures for starting a business, Slovenia occupies the 38th rank;
- • when referring to paying taxes, the country ranks on the 41st rank.
Although Slovenia ranks on the 38th rank for starting a business, it is necessary to know that its score is 92.88 (out of a maximum of 100) and that the registration of a business is comprised of three main steps. It stands above other similar jurisdictions, such as the Czech Republic, Italy or Hungary.
Type of activities a company may undertake in Slovenia
The activities carried on by Slovenian companies are also governed by the Companies Act (ZGD-1). Companies are free to perform a multitude of commercial activities, as long as they are not prohibited by the law. Therefore, companies are allowed to perform commercial transactions as long as they are in the scope of their activities, scope determined by its articles of association.
There are cases in which a company is allowed to perform other type of transactions, not listed in the articles of association, that are mandatory for its existence, as long as they do not imply a direct performance of activities. For more details about the local rules and laws, you may contact our team of lawyers in Slovenia.