Revision to Strategic Companies Act passed

An amendment to the law on strategic state-owned companies was passed on November 20. The new law prevents the privatisation of the country's second largest bank until the end of next year and re-establishes state control over personnel changes to top management at state firms.
During parliamentary debate prior to voting, Finance Minister Brigita Schmögnerová praised the law as the first concrete step towards ending state decisions that favoured interest groups close to the government. Ján Cuper of the opposition HZDS party, on the other hand, said the law opened the gate to the privatization of strategic companies.

An amendment to the law on strategic state-owned companies was passed on November 20. The new law prevents the privatisation of the country's second largest bank until the end of next year and re-establishes state control over personnel changes to top management at state firms.

During parliamentary debate prior to voting, Finance Minister Brigita Schmögnerová praised the law as the first concrete step towards ending state decisions that favoured interest groups close to the government. Ján Cuper of the opposition HZDS party, on the other hand, said the law opened the gate to the privatization of strategic companies.

Of 113 deputies present in the chamber, 85 voted in favor of the law, 34 were against, three abstained from voting and one did not vote. Parliament passed the revision for the first time on November 11, but cabinet decided to return it to parliament on November 18 because of technical and legal flaws in the text.

The freshly adopted act postpones the privatization of the second largest financial institution in Slovakia - Všeobecná Úverová Banka (VÚB) - until the end of 1999, when the government plans to complete VÚB's restructuring. The law also increases the power of the state as the majority owner of several companies considered vital to the functioning of the economy (so-called 'strategic' companies). These firms include energy supplier Transpetrol, electricity giant Slovenské Elektrárne, the nation's largest bank Slovenská Sporiteľňa, largest insurer Slovenská Poisťovňa and VÚB.

The law is designed to enable the new government to carry out personnel reshuffles on the boards of directors and supervisory boards of the state firms, as well as to give it control over the approval of annual financial statements and distribution of profits. Prior to the amendment, the managements of some firms had enacted changes to the statutes of their companies that required large shareholder majorities to remove them from their positions. The new law provides that a simple majority of shareholders will be enough to make personnel changes and take important decisions

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