Amendment to the Slovak Commercial Code – a few points to watch out for
On October 1, 2020, the amendment to the Slovak Commercial Code (the “Amendment”) came into effect introducing several significant changes. The liquidation process as we knew it has shaken in its foundations. Besides it, the below are a few points which we believe are worth to mention.
Registration of restrictions on the directors’ authority to act on behalf of a company
From now on, it is not possible to register a restriction on the director’s authority to act on behalf of a company (e.g. a restricting a director’s ability to execute a transaction below certain value or to execute transactions only in certain field of expertise). Before October 1, 2020, some Slovak commercial registers used to allow registering such restrictions despite the fact that these are not binding on third parties and that such restriction is not anticipated by the Act on the Commercial Register.
Each company which has such restriction registered will have to change it when filing the next application with the commercial register, however, not later than by September 30, 2021. If a company fails to erase the director’s authority restrictions within the next filing with the commercial register, the commercial court will disregard such application as well as any following applications, unless remedied upon a court’s notice.
Confirmation of the registered data relating to branches kept in the commercial register
Each branch (organizačná zložka) must confirm to the registry court that their data registered in the commercial register is correct and up-to-date or file an application on registration of changes of such data no later than by September 30, 2021. Otherwise the commercial register in collaboration with the Slovak Ministry of Justice erases such branch from the commercial register.
Duty to deposit financial statements in the collection of deeds
The Amendment changes a sanction for a breach of the duty to deposit a financial statement in the collection of deeds. Prior to October 1, 2020, a court could have dissolved a company if it failed to deposit its financial statements for two financial years in a row. However, from now on a court will dissolve a company if it fails to deposit its financial statement within six months after it should have done so under §40(2) of the Commercial Code (i.e. within 9 months of the date of the preparation of the financial statement).
Duty to deposit a list of assets in the collection of deeds
If a company is being liquidated and had registered a liquidator before October 1, 2020, than the liquidator must issue a list of assets as of September 30, 2020 and deposit the list to the collection of deeds no later than by December 31, 2020. If the liquidator does not do that, the liquidated company shall be considered bankrupt.