Parliament has passed the companies act, a comprehensive piece of legislation that deals with all aspects of corporate law and will replace the oft-amended 1993 companies act
Parliament has passed in a 53-to-6 vote the companies act, a comprehensive piece of legislation that deals with all aspects of corporate law and will replace the oft-amended 1993 companies act.
Among the major changes, the act envisages the possibility for establishing a European joint-stock company or Societas Europea (SE), a supra-national organisation that can operate in all EU countries without having to establish subsidiaries or branch offices.
This option SE stems from EU regulations adopted in 2001, which took effect a year ago.
The second major change to existing legislation is that companies will have the possibility to opt for a one-tier management system instead of the current two-tier system.
Unlike the existing two-tier system, there is no supervisory board in an one-tier system, with the management board consisting of executive and non-executive members.
The provisions on single-tier management are the most disputable part of the act, which otherwise enjoys bipartisan support.
Most notably, the opposition Social Democrats (SD) and trade unions claimed it does not have sufficient safeguards to guarantee co-determination.
The SD wanted to amend the act to guarantee the workers a third of the members in management boards of companies with single-tier management systems.
The government rejected the proposal and instead granted the workers a single representative and an additional one for every additional three members of the board.
The act introduces more strict provisions for supervisory board members. An individual will now be able to sit on a maximum of three supervisory boards, instead of five.
The act also envisages a cut in the minimum start-up capital for a limited liability company from the current EUR 8,760 to EUR 7,500. Moreover, it will no longer be necessary for at least a third of the start-up capital to be in cash.
In line with the act, the Economics Ministry would draw up a standard form for a memorandum of association, thereby facilitating the establishment of companies.
The act also includes provisions linked to Slovenia's adoption of the euro, which is scheduled for 2007. As a result, companies will have to express their total capital stock in euros rather than tolars.
Companies will have the option of converting the price of shares into euros or converting the whole capital stock into euros and then dividing that into a new number of shares in order to avoid problems with rounding up.
Source: Slovene Press Agency STA