Slovakia Company Formation

Type of Company

Registering a business in Slovakia can be done in the form of

-Limited liability company (spolonosť’s ručením omezeným or SRO).

-Joint stock company (akciová společnost or AS).

Limited Liability Companies or SROs are primarily for small and medium-sized businesses.

• The maximum number of participants is 50 people; in case you need more, it is better to register a legal entity in the form of a simple joint stock company or joint stock company.
• Their liability is limited to the size of their contribution to the capital.
• The General Meeting of Shareholders, which is the company’s highest authority, appoints an executive director responsible for day-to-day decisions.
• A supervisory board may also be appointed to oversee the activities of the director and report to the general meeting.
• The minimum share capital is 5,000 euros, and the minimum share of a member of the company must be at least 750 euros. 750 euros is 15% of 5,000 euros, if you need a share of less than 15%, then you need to increase the authorized capital.

There is no need to deposit the authorized capital into the company’s account, it is enough to deposit it in cash. However, if the authorized capital is higher than the minimum and the participant’s share is more than 5,000 euros, the contribution must be transferred to the company’s bank account due to the limitation of cash payments. Almost all firms leave the authorized capital at a minimum amount, since there is no point in increasing it, except for the case when a share of less than 15% is needed.

• A legal address for an existing company is required.

Restrictions for the founders-participants of an LLC:

A person with tax debts cannot register a limited liability company.

An individual can be the only participant in no more than three companies.

At the same time, an individual can be an accomplice (own less than 100% of shares) in any number of companies.

There is only one limitation with respect to legal entities: the only member of an LLC cannot be a company with a single member.

A joint stock company or SA is a type of company designed for large businesses. A public joint stock company may place part of its shares on the stock market of the European Economic Area. Thus, the shares are freely transferable, which leads to an increase in the authorized capital. Unlike closed companies, SA registration in Slovakia obliges such companies to have a reserve fund, which is 10% of the capital. Day-to-day management is provided by the board of directors and the supervisory board appointed by the general meeting of shareholders. The Supervisory Board must consist of at least three members, and the number of directors may be determined in the Articles of Association.

A Slovak Commercial Code divides joint-stock companies into public (verejné) and non-public (súkromné), however, there is a single abbreviation a.s. – akciová spoločnosť.

• Most of the rules and restrictions regarding LLCs also apply to joint-stock companies.
• The minimum share capital is 25,000 euros, and it is divided into a certain number of shares – shares with a fixed nominal value.
• The market value of the shares may often differ from the par value. Shareholders vouch for the obligation only up to the value of the shares they own, and they are not entitled to claim the return of their investment in the company.
• Bearer shares are no longer used in Slovakia, all shares must be registered.
• Joint-stock companies are used, except when required by law, most often in cases where it is expected that the number of owners will be more than 50 people, or in areas demanding initial capital.
• A joint-stock company can be registered by one founder if he is a legal entity, or at least two if they are individuals.

The bodies of the joint-stock company are:

• The General Meeting is the supreme management body of the joint-stock company. The executive body is the board of directors – an analogue of the general director in an LLC.
• The supervisory body is the supervisory board, the minimum number of members of which is 3.
• the board of directors may be the sole body. Therefore, one person can register an LLC and a simple joint-stock company, at least 4 are needed for an AS.

Disadvantage of a joint-stock company:

-Establishment is more expensive, more complicated and takes more time than in the case of an LLC.

-It is necessary to visit a notary who will not only certify signatures, as in the case of an LLC, but also draw up a notarial protocol, which usually costs several hundred euros

Requirements:

Some of the documents required for registration are as follows:

-Notarized Articles of Association.

-Confirmation of payment of the registration fee.

-Bank certificate of deposit.

-Confirmation of the unique name.

-The most important documents to be prepared are the Memorandum of Association and the Articles of Association, which must be drawn up and notarized before being submitted to the Registrar of Companies.

These documents must contain the following information:

• information about shareholders, which may be individuals or legal entities;
• information about directors and managers, who must be natural persons;
• information about the authorized capital and its division between shareholders;
• address of the company, information about the object of activity and the value of shares.

Additional information, such as shareholder agreements and special provisions, may also be included in the Articles of Association.

Registration steps

There are several formalities that you need to take into account if you want to register a company in Slovakia. Regardless of which legal form you choose, there are certain steps you must follow. So, the stages of company registration include:

• name selection and reservation;
• preparation of documents required for submission to the Commercial Register, which implies their preparation and notarization;
• submission of documents to the Registration Chamber of Slovakia;
• registration of a legal address in the country;
• appointment of company executives;
• registration for tax purposes, obtaining a VAT number (if necessary);
• opening a bank account;
• applying for the necessary licenses and permits that allow the company to operate in a particular area of business.

The first step after choosing the legal form is registering the name, which must be unique. To ensure this uniqueness, the entrepreneur can reserve up to 3 names. Further, the Charter must be drawn up and certified by a notary in Slovakia. The future owner of the company must open a corporate bank account, deposit the authorized capital and receive confirmation from the bank.

It is also necessary to obtain a certificate from the tax authorities stating that partners have no tax debts. Subsequently, the procedure for registering a company in the Commercial Register and obtaining a tax number can be started. The final step is to obtain a VAT number and register with the social security system. After completing these steps, a company in Slovakia can start its activities. Some activities require a license.

You can also register a company without coming to Slovakia by signing documents at the Slovak consulate. You can also sign documents at the Czech consulate, and if all consulates are far away or there is no way to travel, documents can also be signed at a local notary and have them apostilled.

Financial Benefits

• Slovakia is marked as a growth country in the economy.
• Political stability.
• Strategic geographic location.
• The country’s economy is on the rise.
• Slovakia is an EU member state and uses the euro currency.
• Legislative system of the European level.
• It is a country that took part in the signing of the Schengen Agreement.
• The Slovak company has free access to the EU markets.
• Slovakia is currently very actively involved in economic and financial integration projects set up by the European Union.
• Lower taxes than neighbouring countries.
• Opportunities for tax-free distribution of profits.
• Benefits of double tax treaties.
• Slovakia, like Montenegro and Bulgaria, is marked as a growth country in the economy.
• Political stability.
• Well developed infrastructure.