There are multiple ways of running a business in Slovakia. Whether you want to earn the money as a sole proprietor or you prefer to work in a team, you can always find a suitable type of a firm that you can set up in Slovakia.
Here is the information about the most common types of companies in Slovakia. All of them have to be registered in either the Business Register or in the Trade Register, depending on the kind of company.
A great option for people, who prefer to run their business on their own. Setting up a sole proprietorship is not a complex process. To register the name of the business in the Trade Register you need to fuifill certain conditions:
- to be at least 18 years old
- to have clear Criminal Record
Then you have to pay the administrative fee and fill in the registration form. The name of your company will be registered on the Trade register within 3 days.
Limited Liability Company:
The people setting up the Ltd. Company need to pay a certain sum to be able to register the name of the company in the Slovak Business register, which is at least € 5000. The maximum number of people who can act as the partners, is 50, and each of them can pay a certain part of the whole sum. The highest body of the Ltd. company is the General Assembly, consisting of all the company partners.
The least sum of the company’s capital is € 25000. The capital is then divided into a certain number of shares, sold to the shareholders by the company founders. The main decisions are made on the General Assembly where each of the shareholder can vote. The votes are not equal – the vote of a shareholder owning more shares is more powerful than the vote with a shareholder who owns less shares. The General Assembly is under the supervision of the Board of Supervisors.
However, there is a type of new business company available in Slovakia since January 1, 2017 – the Simple Joint-Stock Company.
It is actually a combination of the Joint-Stock Company and Limited Liability Company, resulting in new kind company with high level of flexibility. It was introduced to make the investing in new projects and start ups easier. Therefore, innovative entrepreneurs can easily access the finance resources without dealing with the banks. This kind of business company is very attractive for the investors, because it makes easy to buy and sell the shares and it also provides them with the legal protection.
Here is the list of the most significant advantages of the Simple Joint-Stock company:
- The most flexible way of buying and selling the shares.
- There is no duty to be liable by personal property for the company obligations
- The opportunity to offer purchasing of the shares to the employees (companies who experience high employee fluctuation are interested in this possibility as a means of motivating their employees to stay in the company).
- selling of the shares is free of VAT Tax charge (for example it is more profitable to gain a real estate through buying the shares of a company that already owns a real estate than dealing with the cadastral administration on one’s own).
- The names of the shareholders are not shown in the Business Register.
- The possibility of changing the company’s registered seat to the other country by merging with a foreign company.
- There is no need to elect the Board of Supervisors (for example, the Board of Supervisors is compulsory for the Joint-Stock company, having at least 3 members.)
- The Simple Joint-Stock company can be set up by only 1 person – the person can act as both the partner (in the Limited Liability Company) and the founder of the company. There is no need for other 3 people who would form the Board of Supervisors. However, the Joint-Stock Company needs 4 natural persons – 1 acting as the Board of Directors and the other 3 as the Board of Supervisors.
- It is possible to form special rights concerned with shares, for example – the weight of a vote can be defined differently than by the price of shares.
- The decisions may be agreed per rollam – the shareholders do not have to meet at the General Assembly to adopt a certain decision.
To gain more information, read a table below. There is a comparison of the basic characteristics of 2 most popular types of a business company in Slovakia – Ltd. and the Simple Joint-Stock Company
|Characteristics||Simple Joint-Stock company||Limited Liability Company|
|Minimal basic capital investment||€ 1||€ 5 000|
|Minimal investment of a company’s partner||€ 0.01||€ 750|
|Obligation to record the partners/shareholders in the Business Register||No obligation to record the partners/shareholders in the Business Register||They have to be recorded and their names are visible|
|Obligation to pay the basic capital prior to emerging the company||The sum has to paid in full||€ 2 500 (if there is only 1 partner, then € 5000)|
|Maximum number of the partners/shareholders||No restrictions||50|
|Maximum number of the Simple Joint-Stock companies/Limited Liability Companies that one natural person (as the sole shareholder/partner) can own||No restrictions||3|
|Management of the shareholder’s account||According to the price of one share (min. € 25)||€ 0|
|Liability (responsibility) of the business company for the company’s obligations||Financial Liability reaches up to the sum of the whole property||Financial Liability reaches the sum of the whole property|
|Liability of shareholders/partners||None||sum of the unpaid basic capital investment|
|Non-compulsory bodies of the company||Board of Supervisors||Board of Supervisors|
|The flexibility of regulating the partners’/shareholders’ mutual relations||No restrictions||Restricted|
|The flexibility of selling the shares||Higher||Lower|
In case you would like to decide, which type of the company is more suitable for you, (whether it is the Limited Liability Company (Ltd.) or the Simple Joint-Stock Company) please read the text bellow:
If you would like to:
- set up a family business – Ltd.
- gain the foreign capital by loan – Ltd.
- lend the money by investments of the partners/shareholders – Simple Joint-Stock Company/ JSC.
- grant individual partners individual rights – JSC/Ltd.
- avoid showing the names of the partners/shareholders in the Business Register– JSC/Ltd.
- have the possibility to quickly enter/leave the company – JSC.
- If you do not want to set up the Ltd., but you have only very little people available, or you would like to spare some money – JSC
In case you would like to set up a company in Slovakia, but you have a couple of questions, or you are not sure which kind of a company is the best for you, feel free to contact us. We are more than happy to help you. Please, check out our web site:
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