Investment is one of the most important factors in a national economy in stimulating economic development. In addition to creating new jobs, domestic and foreign direct investments bring new knowledge and technologies and integrate Slovenian companies into the supply networks of transnational companies.
Slovenia strives to attract socially responsible and sustainable companies with higher added value to Slovenia and to increase the attractiveness of the country for foreign direct investment (FDI). That is why the investment in advanced technology and in business process automation are specifically supported. In order to help businesses adapt as quickly and easily as possible to the requirements of the green and digital transition, which requires them to develop new skills, innovate and invest sustainably in clean technologies,Slovenia also wants to encourage investment in research, development and innovation, both for businesses and for the various forms of networking between businesses and knowledge institutions. Slovenia offers favourable tax treatment in the form of tax incentives for investment, R&D and employment.
Activities and Measures to promote domestic and foreign direct investment
Investment promotion activities and measures are aimed at investors at all stages of their entry into the Slovenian market, in the pre-, intra- and post-investment periods.
Investment promotion activities include the provision of quality information, advisory and other services to investors, the implementation of marketing communication activities, the preparation of events that help to strengthen the visibility of the Republic of Slovenia as a location for investment, project management of investment projects, cooperation with existing investors in Slovenia with a view to their expansion, and the analysis of the competitive position of the Republic of Slovenia from an investment perspective.
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 interest rate subsidies; 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 conditions for granting investment incentives, the determination of the conditions for strategic investment, the criteria for assessing applications for granting investment incentives and the criteria for determining the public benefit demonstrated for strategic investment are laid down in the Regulation on amendments and additions to the Regulation on the method of determining conditions and criteria for the allocation of 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.