Cabinet amends law on bearer shares

The Slovak government has approved a legal amendment forcing the registration of bearer shares to promote ownership transparency, Finance Minister Brigita Schmögnerová said on May 26.

"Until now, the institution of bearer shares had made the corporate ownership structure very opaque. We hope that this law will enable us to prevent the dirty practices that we have witnessed in the past years," Schmögnerová told a news conference.

Bearer shares were widely used in privatisation under the previous government of Vladimír Mečiar. New owners of many large formerly state-owned companies were not publicly known.

The new law forces all shares to be registered with the securities registry. While the names of bearers will not be publicly available, the records will be accessible to tax, financial and police authorities.

The government of Prime Minister Mikuláš Dzurinda has pledged to deal with cases of unclear privatisation. In several high profile cases, the government has already forged deals returning privatised stakes to state hands.

The new law has to be approved by parliament. Schmögnerová said the government anticipates that the law will go into effect by August 1, 1999 and all bearer shares will have to be registered by the end of the year.

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