Slovakia will introduce new corporate form in 2017 which will be a very attractive investment vehicle that will introduce the most modern legal framework in the EU.
Simple joint-stock company and its advantages
This new form is called ‘simple (or simplified) joint-stock company’ (in Slovak: jednoduchá spoločnosť na akcie) (”Investment Company“), and will introduce modern legal framework. The vehicle shall be the best for venture capital deals and for PE investments involving less than 100% equity (both minority and majority buyouts).
- All internal relations between shareholders, stakeholders and business owners can be set with unparalleled freedom
- Company’s shares are free to issue in various classes, entitling to a wide range of rights.
- No explicit limitations on rights that can be attached to shares in the Investment Company
- Shareholders can create various shareholder classes that reflect their position or time when they entered the Company
- Possible to issue “employee shares” which can prove to be very efficient for employee motivation and reward
- Acknowledgement and use of standard investor tools: drag-along, tag-along and deadlock mechanism (shoot-out)
- The rights can be agreed in shareholders’ agreement and will have a strong legal protection (the rights can be registered in a public register giving no space for non-compliance)