Foreign Direct Investments
Foreign direct investment is an important factor in economic growth and brings many beneficial effects to Slovenia’s economy. In addition to creating new jobs, they also bring new knowledge and technologies and the integration of Slovenian companies into the supply networks of transnational companies.
Slovenia is striving to attract socially responsible and sustainable foreign companies with that have a higher added value. It wants to support high-tech investments and increase the attractiveness of the country for foreign direct investment (FDI). Within the tax system, Slovenia offers favourable tax treatment in the form of incentives for investments, research and development and employment.
Activities and Measures for the Promotion of Foreign Direct Investment
Activities and measures to promote FDI are intended for investors at all stages of entering the Slovenian market before, during and after the investment.
Activities for promoting investments are the provision of quality information, advisory and other services to investors, implementation of market communication activities, organisation of events contributing to the visibility of the Republic of Slovenia as a location for investment, project management of investment projects, cooperation with the existing investors in Slovenia with a view to expanding their activities, and analysing the competitive position of the Republic of Slovenia in terms of investment. Other activities are: proposing systemic measures for its improvement, definition of areas intended for strategic investment by strategic spatial documents, promotion of land policy measures with a view to promoting investment, and other activities contributing to the visibility of the Republic of Slovenia as a location for investment.
Measures to encourage investment, which are equal for both domestic and foreign investors, are regulated by the Investment Promotion Act.
The Act provides the following investment incentives:
- incentives in the form of loans, guarantees and subsidised rates of interest; and
- purchase of property owned by a local community at a lower than market price based on a direct agreement.
The detailed determination of the fulfilment of the conditions for the allocation of investment incentives, the determination of the fulfilment of the conditions for strategic investment, the criteria for the evaluation of applications for the allocation of investment incentives and the criteria for determining the demonstrated public benefit for strategic investment is determined by the Decree on the method of determining the conditions and criteria for allocating investment incentives and conditions for strategic investment.
National Mechanism for Reviewing Foreign Direct Investments in Slovenia
The mechanism for the review of foreign direct investment began with the implementation of the Act Determining the Intervention Measures to Mitigate and Remedy the Consequences of the COVID-19 Epidemic. Insofar as the transaction of a foreign investor represents a foreign direct investment, that is, if an investor acquires at least 10% of the share capital or voting rights by a transaction in a Slovenian company, and the activity of the target company relates to one of the risk factors (critical infrastructure, critical technologies, the supply of critical resources, access to sensitive information, freedom and pluralism of the media and projects or programmes of interest to the European Union), the foreign direct investment must be notified to the ministry responsible for the economy within 15 days of:
- the conclusion of the merger contract or the announcement of the takeover bid (any contract by which a foreign investor acquires at least 10% of the share capital or voting rights in a Slovenian company),
- the establishment of the company in the Republic of Slovenia,
- the conclusion of the contract of sale granting the investor the right to dispose of the land and real estate.
The Notification Commission at the ministry responsible for the economy deals with notifications of foreign direct investment and issues opinions on the introduction of the review procedure – preliminary procedure. If the review procedure is introduced and it is established that the foreign direct investment affects the security and public order of the Republic of Slovenia, it may be prohibited, revoked or the conditions for its implementation may be determined. The notification shall be submitted directly to: Internationalisation, Entrepreneurship and Technology Directorate.