SLOVENIA Law and Practice Contributed by: Vid Kobe and Peter Gorše, Schoenherr Slovenia
sons is, generally, tax deductible only if it is in line with the transfer pricing rules (ie, does not exceed the published recognised interest). Under Slove- nian thin capitalisation rules, interest payments on debt financing (eg, loans) provided by a taxpayer- related person (a person directly or indirectly holding at least 25% of shares or voting rights in the taxpayer) are generally not tax deductible if such financing exceeds four times the amount of the relevant related person’s share in the capital of the taxpayer. This is particularly relevant in constel- lations involving a lender who is also a (direct or indirect) shareholder of a Slovenian obligor (eg, in mezzanine-financing scenarios involving an equity kicker). Most of these risks may be mitigated by diligent trans- action structuring and/or drafting of loan documenta- tion, whereas specific risk mitigation measures must be assessed on a case-by-case basis. The composition of security packages taken by lend- ers generally depends on the specifics of the trans- action and the available assets of the Slovenian obligor(s). By way of a general overview, the follow- ing asset classes are commonly subject to security in Slovenia: • shares; • receivables (trade, intercompany, acquisition, insur- ance, bank account, etc); • business equipment; • inventory/stock-in-trade; and • certain IP rights (most notably trade marks and patents). The most common types of security used in the Slove- nian market are a pledge ( zastavna pravica ) – typically established over shares, real estate, movables or IP rights – and a fiduciary assignment/fiduciary owner- ship ( fiduciarna cesija/prenos ) – typically established over receivables and certain types of movables. 5. Guarantees and Security 5.1 Assets and Forms of Security
Formalities and perfection requirements depend on the type of security and asset over which the security is established, as follows. • Form of the security agreement – Most security agreements require the form of a notarial deed ( notarski zapis ), either as a constitutive condition (forma ad valorem) – which inter alia applies to security over shares in private limited liability com- panies ( družba z omejeno odgovornostjo (LLCs)) and certain movables – or in order to establish bankruptcy remoteness, which applies in particular to the security over receivables in the form of a fiduciary assignment. Even where no specific form is required, concluding the security agreement in the form of a notarial deed may afford additional rights to the lenders, most notably a right of direct enforceability (ie, a right to enforce a claim/security via court without having to obtain a prior judg- ment). • Registration – Where assets and related rights are entered into a public register, the registration of the security interest will be required to create or per- fect the security. There are differing views in legal theory and case law as regards the effects of reg- istration of security over different registrable asset classes (eg, real estate, movables, trade marks and patents). In any event, an absence of registra- tion may, inter alia, result in a bona fide third party obtaining a legal title over an unencumbered asset; hence, registration is highly recommendable. • Notifications – Notifications of debtors or the com- pany will also be required to perfect the security in certain cases (most notably in the case of fiduciary assignment of receivables and pledge over shares or receivables). The absence of notification typical- ly will not prevent the security interest from being created, but will carry other risks such as losing the security ranking and/or the debtor validly discharg- ing its obligations to the original creditor. • Other formalities – Certain asset classes may also require other specific steps to be taken in order to create or perfect the security interest. By way of example, it is commonly requested that insur- ance companies provide an acknowledgement of assignment of insurance receivables/vinculation confirmation ( potrdilo o vinkulaciji ) and – due to specific requirements of each bank – for a bank to
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