The business environment in Slovakia, from an attractiveness perspective, is ranked as one of the best in Central and Eastern Europe. This is not true only for the large multinational investors, but also for mid-size and small business. The geographical positioning, the fair tax and levies load, the relative supply of labour force, the approach of state and self-governing organs and the developing transportation infrastructure make the country a good springboard not only for business in Europe, but also for expansion to the eastern markets. A special position is held by Eastern Slovakia, whose location creates a kind of natural gateway between Europe and the countries of the former Soviet Union.
Foreigners doing business in Slovakia are governed by the same rules as it is for citizens of the Slovak Republic. The basic condition for doing business for foreigners from a third country (countries which are not members of the European Union) is acquiring the appropriate permission for temporary residency.
As pursuant to law # 404/2011 Coll. concerning residency of foreigners and the amendments and supplements of some laws in the wording of later regulations, a foreigner may do business in Slovakia as a self-employedperson or businessman, or as a statutory body of a trading company or cooperative. Temporary residency for the purpose of business can be obtained for up to three years. The decicision and time period for which the residency is granted is at the discretion of the individual departments of the Foreign Police, but generally the first residency for the purpose of business is given for a period of two years.
For obtaining permission for the purpose of business, in principle it is neccessary to give evidence for basic facts. They are:
- purpose of residency,
- financial support for residency,
- provision of accommodation,
- clean record.
Now we will look in greater detail at the individual documents which confirm the facts required for granting temporary residency for the purpose of business, that being confirmation of the purpose of residency, and the financial means of residency. Provision of accommodation and clean record are subjects of a specific article.
Purpose of stay
For business as self-employed the purpose of stay may be evidenced mainly by submitting verification of your trade license (Trade Certificate). A trade as such is defined in the law # 455/1991 Coll. concerning self-employment as pursuant to later regulations. Self-employment is based upon notification which is carried out at the local District Office at the division of trade business. When a foreigner declares self-employment, he must submit to the District Office:
- identification document (document confirming age of majority). In the case of foreigners this is a valid passport,
- document of Good Conduct (printout of criminal record from home country). This document should be certified by the relevant organs for use abroad (apostille, higher authority),
- document confirming professional competence (if announcing specified trade or craft),
- document as to authorization to use property which is presented as the place of business,
- consent of the responsible officer appointed to the function (in the event of the businessman himself not fulfilling the conditions of professional competence).
Apart from this, presented in the application are activities which will be the subject of his business. It is therefore appropriate if these subjects of activity are determined in advance and confirmed, whether they are craft or bound activities. If some of them are bound or craftsman trades, it must be verified if the education of the foreigner meets the requirements for professional competence as pursuant to valid legal regulations, or whether it requires the educational recognition by the education minister, or by another institution. If the education of the foreigner is insufficient as a document of professional competence, then a responsible representative must be provided for the activity.
Regarding the fact that a foreigner is, as pursuant to legal provisions, an alien individual, it is neccessary that there be established a foreign individual as business leader, who for example may be a citizen of the Slovak Republic, or a person who has permission to reside in the Slovak Republic (not all citizens with residence in the territory of the Slovak Republic may do business, and therefore register as the business leader for a foreign individual).
In business as statutory representative of a trading company or cooperative, the purpose for stay is confirmed in two manners. The first is submitting a business plan, whose form is determined by special provisions. This business plan is then forwarded to the Ministry of Agriculture of the Slovak Republic, which decides whether business or trading by this individual will bring benefit to the economy of the Slovak Republic. The business plan is submitted in the event of the foreigner being the statutory representative of the company (cooperative) which has not been established yet, and is not yet written in the Commercial Register.
In a case where a foreigner will act as statutory representative of an already existing company, or cooperative, the purpose of stay is documented by the listing in the commercial register of this subject.
Another document which is submitted when making an application and which confirms the purpose of stay is a document by which the foreigner is established in the function of statutory representative of the trading company, or cooperative (decided by General Assembly, founding document, formal contract).
Financially providing for stay
When financially providing for stay, evidence is given of sufficient financial means for life in Slovakia as well as for doing business in the territory of the Slovak Republic. Once again we discuss it from the perspective of the self-employed applicant and applicant of statutory representative of the trading company or cooperative.
When doing business as a trade the following sums must be evidenced:
- minimum 12-fold of the living wage – which is a minimum sum of 2377,08 EUR (12 x 198,09 – living wage). This sum is evidence of sufficient financial means so that the foreigner not become a burden on the social system of the Slovak Republic. This sum is usually documented by confirmation from the bank as to available balance on the account, which is kept in the name of the national of the third country who is applying for residency. (Confirmation may also be from a bank in the home country, but such a verification must then be translated into Slovak language by a translator who is registered on the list of experts, translators and interpreters overseen by the Department of Justice of the Slovak Republic),
- minimum 20-fold of the living wage – which is a minimum sum of 3 961,80 EUR (20 x 198,09 – living wage). This sum is evidence of sufficient financial means required for operating business activities in the territory of the Slovak Republic. This sum is also evidenced by confirmation of available balance on the account, which is kept in the name of the national of the third country who is applying for residency. (It is good when this account has already been opened in a bank in Slovakia on the basis of an earlier issued trade authorization).
Decision for granting stay
The relevant organs have a 90-day limit to make a decision as to granting or refusing residency for the purpose of business. This time period starts on the day of receipt of the application at the appropriate department of the Foreign Police, where it will be decided. (Regarding the fact that in matters of temporary stay and based upon requests by the Foreign Police Office input may be given from other state organs, organs of town administration etc., and it may happen that the time limit is not adhered to. In this case usually the Foreign Police Office proceedings are interrupted until a decision, or standpoint is put forth by the organ in question.)
After being granted temporary stay in Slovakia, further responsibilities ensue for the foreign national, from these we select:
- within 30 days of the receipt of the residency document, the foreigner must submit confirmation of health insurance within the territory of the Slovak Republic,
- within 30 days of receipt of the residency document, he must submit verification to the appropriate healthcare facility that he suffers no illness which would threaten public health in the Slovak Republic,
- within 60 days of receipt of the residency document, he must submit a listing from the Commercial Register of the company, or cooperative, under the name in which it will act, or a listing from the Commercial Register of the business of a foreign individual, if he is doing business in Slovakia as a self-employed person.
What next?
After undergoing this process and registering the company, the business of a foreign individual in other organs and institutions (tax office, social, health insurance, etc.) has nothing preventing them from doing successfull business in the territory of the Slovak Republic.
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