ECONOMY: Package of Measures for Economic Recovery

The government has introduced a Package of Measures for Economic Recovery that contains measures which will have an immediate economic impact. At the same time, ministries have been charged with implementing the measures by the end of July 2012.

The Package of Measures for Economic Recovery specifies key measures in four domains:

• improvement of the business environment by amending the Investment Companies Act and the Financial Transactions Act, procedures regarding non-solvency and forced closure; by amending legislation in the field of asset management; by legislative measures relating to agricultural land; by changing the Act on Payment Tardiness and debt execution, the Craft Act; amending the Act on Construction and the Guarantees Act of the Republic of Slovenia on financing investment companies by passing sub-legal acts;
• financial support in the field of investments, strengthening human resources and energy efficiency that will be allocated to prospective projects that will ensure continued growth and development;
• an action plan for small companies, which is a combination of measures which comprehensively build a supportive environment for micro, small and medium size companies;
• related and restructured agencies which manage public goods are an important step towards the more effective management of companies partly or fully owned by the state.

More information: Ministry of Economic Development and Technology, Ms Suzana Zagorc, Public Relations, (phone: +386 1 400 33 20, email: suzana.zagorc[@]gov.si ).

FINANCE: The Guarantees of the Republic of Slovenia for investment companies financing

The government has finalised the wording on the proposal for the amendment to the Guarantees Act of the Republic of Slovenia regarding financing investment companies which would abolish the institution of legal representative and, among other solutions, accelerate the possibility of granting guarantees on repayable funds while simultaneously demanding higher insurance.

Based on economic alerts, an amendment to the Act has been passed in 2011 which expanded the possibility of issuing guarantees to guarantees on repayable funds. Because of the high risk involved in such guarantees, the amendment posed more stringent criteria on request authorisation and guarantee insurance, as well as introducing the institution of the legal representative of the Ministry of Finance. Among other factors, it has been made clear that the institution of the legal representative would not function in tandem with responsibilities to an investment company receiving a guarantee. The functional status of the legal representative was thus undefined; additionally, the process of appointing the legal representative through a public tender process would take too long for legislative solutions (guarantees on repayable funds), which were conceived primarily as anti-crisis measures to be executed. This is why the proposed amendment abolishes the institution of the legal representative, while simultaneously increasing insurance requests for repayable funds. The Act also increases the scope of guarantees on investments to 80%.

The main points of the Act are:

• abolition of the institution of legal representative; instead, it proposes higher insurance on guarantees (70%) when crediting repayable funds by company management and shortens the deadline to 12 months,
• the total allotment of all repayable credits is 20% of the annual revenue,
• adding the possibility of issuing guarantees on services and projects already underway, while also attending to other ambiguous parts of the Act.

More information: Ministry of Finance, Public Relations, Mr Peter Bajec (phone: +386 1 369 63 80, email: peter.bajec[@]mf-rs.si )