The Slovenia Times

MPs Pass Changes to Companies Act Targeting Unfair Practices


Virtually all deputy groups believe that the changes are a step in the right direction and that a balance should be found between interfering in the free economic initiative and limiting unfair practices.

The amendments partially transpose into Slovenian legislation several EU directives, including the directive on the annual financial statements, consolidated financial statements and related reports.

Special attention was paid to limiting the incorporation of new firms, with the main purpose being to try to prevent unfair business practices that often leave creditors and employees empty-handed.

In accordance with the changes, persons who have had stakes in excess of 50% in limited liability companies (LLCs) that were erased from the companies registry without liquidation will be banned from setting up new LLCs for six months.

No individual will be allowed to set up more than one LLC every three months, a provision that directly tackles the daisy-chaining of companies.

One of the conditions to establish a new company is that owners who have already owned a company need to prove that the workers in the old company were paid all welfare contributions in the last 12 months.

Those who were fined twice in relation to payment of workers or undeclared employment in three years will be banned from establishing or becoming a partner in a new company for three years, in accordance with an amendment from the opposition United Left (ZL) that was confirmed with a slim majority.

A five-year ban on establishing a new company would be applied on those who were sentenced to prison for white-collar crime.

Suzana Lep Šimenko of the opposition Democrats (SDS) stressed during Friday's debate that the companies act was one of the most important laws for the economy, which is why one should tread carefully in enacting changes not to encroach upon the free economic initiative while preventing unfair practices.

The opposition New Slovenia (NSi) welcomed the changes as a step towards limiting unfair practices, but also proposed that those fined in relation to payment of workers or undeclared employment should be banned from starting a new company for three years. The original proposal was one year.

Franc Trček of the ZL said that while the party was inclined to changes protecting workers, these amendments would not prevent by-pass financing, mailbox companies or other practices detrimental to workers and the state.

The coalition Pensioners' Party (DeSUS) argued that the changes would not bring excessive regulation. "Enough with unfair business practices," said MP Tomaž Gantar, while Jan Škoberne of the coalition Social Democrats (SD) added that it was right to introduce mechanisms to protect creditors and workers.

Andreja Potočnik of the ruling Modern Centre Party (SMC) added that the amendments were a signal that the government was serious about limiting unfair business practices. The purpose is not to punish people entering business, but to create a fair business environment, she stressed.

Banks, insurance companies and the Bank Asset Management Company (BAMC) will be exempted from restrictions to establish new companies. An amendment was also confirmed Friday expanding the exemption to the state the Slovenian Sovereign Holding (SSH) and the KAD and DSU funds as managers of state assets.


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