SLOVAKIA Law and Practice Contributed by: Lukáš Michálik, Peter Makýš and Šimon Hora, Ments s.r.o.
tives pursuant to a special regulation, is not subject to tax, even if the transformation also includes the assets of a company with its registered office in the member states of the European Union; • where a taxpayer who has started to claim an exemption has ceased to exist as a result of a conversion or cross-border conversion, their successor in title may not continue to claim the exemption; and • income from sources within the territory of the Slovak Republic of a taxpayer with limited tax liability is income from the payment of valuation differences on revaluation on the conversion of companies or cooperatives in the amount determined by the statutory conditions. 5.3 Spin-Off Followed by a Business Combination Under Slovak law, a business combination can- not follow immediately after a spin-off, as specif- ic business combination deadlines must be met. Under the relevant provisions of the law, one of the formal steps that must take place prior to a business combination is the obligation to noti- fy the tax administrator. Notifications must be delivered by each of the dissolving companies no later than 60 days before the general meeting at which the draft business combination agree- ment is to be approved. In light of the above, it follows that a business combination cannot take place immediately after the spin-off as Slovak law makes it conditional upon certain other formal steps for which the law sets certain time limits. In addition to the 60-day deadline, the whole process between a spin-off and business combination is prolonged by sev- eral formal steps (eg, the filing of an application
for registration of the business combination in the commercial register). 5.4 Timing and Tax Authority Ruling The process of company spin-off generally takes several months in the Slovak Republic. In prac- tice, for smaller companies, it can take up to three months, and for larger companies it can take up to six months. The procedure is fairly complicated and, in addition to formal docu- mentation obligations, it involves, for example, the obligation to settle matters between the dis- solving entities and their creditors. The process in relation to the tax authorities in most cases only involves notification obliga- tions, with no need to seek the tax authority’s consent. However, partly related to this issue is the obligation for the companies involved in the spin-off to ensure the preparation of an auditor’s report. 6. Acquisitions of Public (Exchange-Listed) Technology Companies 6.1 Stakebuilding The reporting threshold for the acquisition of an interest in a public company is 5%, 10%, 15%, 20%, 25%, 30%, 50% and 75% in the case of an acquisition of shares to which voting rights are attached. The obligation to notify the issuer is no later than four trading days. However, it should be noted that there is cur- rently no trading in high volumes of company shares on the local stock exchange in Slovakia. The situation is continuously improving, howev- er, and investors and companies are gradually recognising the local stock exchange’s advan- tages.
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