Advantages Of Registering Your Company in Slovenia
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Advantages of Registering Your Company in Slovenia | 2024

Expanding your business horizons involves strategic decisions, and one such option gaining prominence is Slovenia, which is located in Europe. With a plethora of advantages, Slovenia proves to be a favourable business destination. Let's delve into the key advantages of registering your company in Slovenia.

Advantages of Registering Your Company in Slovenia

Slovenia offers many advantages for entrepreneurs. Some of the factors are:

Why Choose Slovenia?

Slovenia's strategic location, economic stability, and business-friendly policies make it an ideal choice for entrepreneurs.

Forming a Slovenian Company

The procedure for forming a company in Slovenia is relatively straightforward and can be completed in a few days. The most common forms of companies are the limited liability company (družba z omejeno odgovornostjo – d.o.o.) and the joint-stock company (delniška družba – d.d.). The process typically involves drafting the company's articles of association, obtaining a tax identification number, setting up a corporate bank account, and registering with the relevant authorities, such as the Slovenian Business Register and the Tax Administration. The specific steps and requirements may vary based on the type of company being formed and services a professional agency can be engaged to assist with the process.

Opening a company in Slovenia involves choosing a legal form, determining the minimum share capital, and completing the registration procedure with the relevant authorities. Slovenian businesses are required to apply for VAT registration by submitting a form on the online platform of the Tax Administration Office.

Timeframe to Establish

The exact duration may vary due to different factors, such as the company type, the completion of necessary paperwork, and the effectiveness of the relevant institutions and service providers.

The timeframe to establish a business in Slovenia varies based on the type of company and the specific requirements. The registration process for an LTD firm typically takes around 2 to 4 days to register the company, with an additional 3 to 5 business days for the court to issue the registration decision.

Registering a branch office in Slovenia usually takes a maximum of 14 days, with an average duration of about one week. In certain instances, establishing a business in Slovenia, such as a private limited liability company, can be finalized in about 4-5 hours.

Future Company Landscape

Foreign investors are attracted to Slovenia because of its advantageous location in central Europe, well-established transportation networks, stable investment environment, and modern infrastructure. The country adheres to EU standards in various sectors and provides a business-friendly atmosphere. The government has established Invest Slovenia to encourage foreign investment and offers financial assistance, tax incentives, and a 19% tax deduction for research and development investments.

Starting from July 1, 2023, a new foreign direct investment regime has been introduced, requiring non-EU investors to undergo a screening process. This marks a shift from the previous classification of all non-Slovenian entities as foreign investors. The new regime ensures that foreign investments align with national interests and security. While Slovenia remains an appealing investment destination, foreign entrepreneurs are now subject to a more rigorous FDI screening process.

Corporate Income Tax Rate

For any investment, a favourable tax structure is a business priority. Slovenia boasts a corporate tax structure that is not only favourable but also transparent. The tax of 19% is considered chiefly reasonable by foreign investors.

Company Registration

Choosing the proper structure is fundamental to success, and understanding economic growth and business models ensures alignment with the region's priorities.

Choosing the Right Structure

Explore the legal forms available and choose the structure that best suits your business objectives. The types of companies that can be established are limited liability companies, sole entrepreneurs, joint stock companies, limited partnerships, and limited partnerships with share capital. The board structure of each type of company in Slovenia varies, but typically, each company must have at least one director and one shareholder. Limited Liability Companies (LLCs) and Joint Stock Companies (JSCs) have a minimum share capital requirement, while Sole Proprietorships (SPs) and Limited Partnerships (LPs) do not. The liability of the shareholders also varies depending on the type of establishment.

In Slovenia, a company is recognized as a legal entity if it engages in profit-oriented market activities. Diverse business prospects are available in sectors such as finance and services. The local government provides incentives and support to enhance the value of businesses with foreign investment operating in the local market.

Professional Assistance

The cost of professional assistance to set up a business in Slovenia can vary based on the specific services required and the type of company being established. The formation of an LLC by a sole founder can be completed online via the government's SPOT portal, and there is no cost associated with this process. If specific requirements for online or SPOT company registration are not fulfilled, the LLC must be registered through a notary public.

The minimum capital required to establish an LTD company is 7,500 euros. There are exceptions based on business activity. The minimum subscribed capital needed to finalize the incorporation of an LLC is €25,000, with a minimum paid-up capital requirement of €7,500. 25% of the paid-up capital must be deposited into a local capital account before the company can be registered with the Slovenian Business Registrar. A minimum share capital of EUR 7,500.00 is typically required for most business activities when establishing an LTD company, with some exceptions based on the chosen business type.

The legal address is a crucial rule for establishing a company in Slovenia. When registering, any company must have a business address in Slovenia, typically in the most suitable city for the business. The address can be a residential apartment or house, as long as the business activities do not cause disturbance. The address must be registered with the Slovenian Business Register, a public register accessible to everyone. Additionally, the address is provided to the Tax Administration and the Health Insurance Institute of Slovenia for mandatory health insurance applications. Some businesses in Slovenia offer virtual offices and Slovenian business address services, which can be advantageous for foreign investors without a physical address in Slovenia.

Residence Permit

To acquire a residence permit in Slovenia, individuals need a valid passport, a police certificate demonstrating a clean criminal record, and documents of health insurance and sufficient financial means. The available types of residence permits are determined by the purpose of residence in Slovenia, such as work, study, or family reunification.

The cost of a temporary residence permit ranges from €50 to €102, and it is valid for up to three years. The process of obtaining it can take up to three months, and the permit must be registered within eight days of issuance. Individuals can typically apply for permanent residency after residing in Slovenia for five years on a temporary residence permit. The individual must obtain permanent residency before applying to become a citizen.

Conclusion

In conclusion, while considering the advantages of registering your company in Slovenia, the country emerges as a promising destination for company formation, offering a blend of its strategic location, favourable taxation structures, and a streamlined registration process. Whether you are a foreign investor or an entrepreneur seeking growth, Slovenian legislation provides a conducive environment for business opportunities.

FAQs

What is the Slovenian Business Register?

The Slovenian Business Register is a centralized database with information about all business entities engaged in either profit or non-profit activities. It is a publicly accessible online register.

What are the key investment areas and incentives for foreign investors in Slovenia?

Slovenia presents significant investment prospects in sectors like the automotive industry, electrical engineering, electronics, life sciences, pharmaceuticals, and the chemical industry.

What type of legal framework is required to establish a business in Slovenia?

The legal framework governing establishing businesses in Slovenia by foreign investors is outlined in the Foreign Direct Investment (FDI) Control Rules of Slovenia. These rules do not impose standstill obligations and do not include sector-specific review mechanisms. Foreign investors, who are citizens or legal entities from a third country, are provided incentives and support by the Slovenian government to enhance the value of foreign-capital businesses operating in the local market.

Usha Menon

With over 25 years of experience as an architect, urban designer, and green building consultant, Usha has been designing sustainable, and visionary spaces. She has published a book, has been actively blogging, and is on social media. Now, her journey is transitioning to full-time writing. Her words will continue to craft stories, not brick and mortar, but in the realm of ideas, fostering a better, more inspired world.

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