Setting up a business in Slovakia
13 November 2009by Ina Dimireva -- last modified 14 November 2009
An overview of the process of starting a new business in Slovakia.
Legal requirements
In the Slovak Republic the conditions for setting up a company are regulated by Act No. 513/1991 Coll., the Commercial Code.
A business activity is taken to refer to a systematic activity independently conducted by an entrepreneur, in their own name and under their own responsibility, for profit-making purposes. An entrepreneur is taken to refer to:
- a natural person or legal entity recorded in the Commercial Register;
- a natural person or legal entity engaged in a business activity on the basis of a trading licence;
- a natural person or legal entity engaged in a business activity on the basis of a licence issued under the terms of special legal regulations other than the provisions governing the issue of a trade licence (e.g. lawyer, artist, sportsperson, translator, interpreter, expert, civil engineer, registered architect, self-employed farmer, but also a bank, generating plant, traffic manager, pharmaceutical product manufacturer, radio and television station, air carrier, healthcare provider, etc.);
- a natural person engaged in agricultural production who is recorded in a register under the terms of a special legal regulation.
A business activity may be commenced by persons who are aged 18 or over, legally competent and with a clean criminal record. Specialist competence comprises a further condition.
Each new business requires a clear business strategy and guaranteed funding so as to achieve a well-balanced, smooth start to its business activities.
Administrative procedures
Business activities can be conducted by:
- a natural person, whether incorporated in the Commercial Register or not;
- a legal entity, i.e. a commercial company (joint-stock company (akciová spoločnosť), limited liability company (spoločnosť s ručením obmedzeným), limited partnership (komanditná spoločnosť), general partnership (verejná obchodná spoločnosť)), co-operative (družstvo), foundation (nadácia), association (združenie).
Natural persons and legal entities register their respective trade at the Trade Licensing Office with local jurisdiction. The Trade Licensing Office issues trading licences to parties registering trades and entrepreneurs are entitled to perform trades on the basis of these trading licences. State administration in the Slovak Republic with respect to self-employment is conducted by:
The Slovak Ministry of the Interior [SK]
Trades fall into two categories in the Slovak Republic: notifiable trades (ohlasovacie živnosti) and concession trades (koncesované živnosti).
Central government administration portal [SK]
Starting up a business as a legal entity is more complex in administrative terms, especially when setting up a commercial company or co-operative, because they are recorded in the Commercial Register. A commercial company is established through a Memorandum of Association or a Deed of Foundation. The commercial company is formed on the date recorded in the Commercial Register.
Setting up and formation of a commercial company [SK]
Entrepreneurs must register with the relevant tax authority within 30 days of a trading licence being issued. The entrepreneur's place of permanent residence determines which tax authority holds jurisdiction. Self-employed persons have to pay health insurance premiums and must therefore register as self-employed within 8 days of setting up a trade. For social welfare insurance, business start-ups must be registered with the Social Welfare Office.
Slovak Tax Authority Central Portal [SK]
Social Welfare Office Portal [SK]
Under the terms of the Slovak Commercial Code, a foreign person or entity may participate in the establishment of a Slovak legal entity and/or become a shareholder in a Slovak legal entity which has already been established. A foreign person or entity may establish a Slovak legal entity or become the sole shareholder in a Slovak legal entity if the Slovak Commercial Code permits a sole founder or shareholder.
The legal relations of legal entities established by foreign persons or entities continue to be governed by the national laws according to which the respective legal entity was established, even after its registered office has been transferred to the Slovak Republic. The shareholders' third party liability also continues to be governed by the national laws according to which the legal entity was established. This liability must not, however, be lower than the liability set under Slovak law for the form of legal entity in question or for a similar form of legal entity.
Resources
Under the terms of a joint initiative between the Slovak Republic and the European Union, the National Agency for the Development of Small and Medium Enterprises (NADSME) was set up in Slovakia in 1993. Slovak law allows entrepreneurs to obtain loans at improved rates under the Micro-loan Programme.
Programmes
Another option for developing a business start-up is to opt to develop the business in an incubator. Incubators provide services for selected business plans as part of the promotion of a particular region, offering support and starting conditions suited to the needs of business start-ups over the first few years of their existence. Incubators help starting and expanding entrepreneurs to overcome obstacles, allowing them to develop their respective business as successfully as possible. They increase newly-created small businesses' chances of survival and alleviate the impact of the market during the initial stages of a business start-up.
Aid is also set aside for entrepreneurs for business start-ups under the Operational Programme for Competitiveness and Economic Growth for 2007-2013 (OPCEG). This programme is run by the Slovak Ministry of the Economy. Aid is defined on the basis of the Support for Starting Entrepreneurs Scheme (de minimis aid scheme). Starting entrepreneurs can obtain non-refundable financial aid, subject to compliance with the conditions set out under the scheme.
Personalised help and advice
Entrepreneurs can opt to join the Slovak Chamber of Trades and the Slovak Trades Federation, organisations founded to support the development of small and medium-sized enterprises.
The following centres operate in Slovakia as part of this network: the National Agency for the Development of Small and Medium Enterprises in Bratislava; BIC Bratislava (Business and Innovation Centre); RPIC Prešov (Regional Advisory and Information Centre); SOPK (Slovak Chamber of Commerce and Industry) and BIC Group, s.r.o.
National Agency for the Development of Small and Medium Enterprises in Bratislava
BIC Bratislava (Business and Innovation Centre)
SOPK (Slovak Chamber of Commerce and Industry)
The Enterprise Europe Network provides businesses with information and advice through its local partners.
Enterprise Europe Network – contact points – Slovakia
SOLVIT helps businesses deal with problems that arise when national authorities wrongly apply EU market rules.
SOLVIT – contact points – Slovakia
Source: European Commission
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