Slovak firms in tax havens face risk of bankruptcy

Over 1,000 Slovak firms based in tax havens are considered to be extremely high risk.

Mossack Fonseca, Panama CityMossack Fonseca, Panama City (Source: AP/SITA)

Over 1,000 Slovak firms based in tax havens are considered to be extremely high risk, according to an analysis by Bisnode company.

A total of 1,035 firms out of 4,479 fall within the worst ‘C’ rating. Meanwhile, 20.1 percent of firms come under the BBB rating and 18.3 percent under the CCC one. Only 136 companies (3 percent) fall within the AAA rating, the TASR newswire reported.

The analysis showed that firms based in tax havens are economically less stable and present a higher risk, according to Bisnode.

Read also:Panama Papers connect PM’s friend with oligarchs Read more 

“If we do business with them, we’re susceptible to a higher business risk,” said Bisnode analyst Michal Řičař at a press conference in Bratislava on May 19, as quoted by TASR. “These companies have lower profitability, worse financial management, they are highly likely to be indebted and pay what is due only after the deadline expires. We can expect increased instability in such companies in the future because the owner requires profit, but nothing is for free.”

At the same time the risk of doing business with offshore companies is quite stable and has even slightly decreased year-on-year. The most risky tax havens are the British Virgin Islands and the USA.

Get daily Slovak news directly to your inbox

Top stories

News digest: Slovakia opens more testing sites

Slovaks smoke less than 10 years ago. Former tennis player who skipped the vaccination line helped at a hospital.

Journalists' dilemma over the case of the charged Jaroslav Haščák

Investigative reporter Adam Valček writes about what he learned during the Kuciak murder trial and how it applies in the case of the charged co-founder of Penta.

Jaroslav Haščák

Drop in car production lower than expected

Carmakers manufactured 11 percent less cars than in 2019.

Carmakers in Slovakia also produce electric battery and hybrid car models.