Shell companies underlie monitoring for over a year

Two registers of beneficial owners create unnecessary administrative burden in Slovakia, lawyers think.

Cyprus is considered a major hub for shell companies. Cyprus is considered a major hub for shell companies. (Source: AP/TASR)

The Register of Public Sector Partners (RPVS) has been recording all companies that receive public funds in Slovakia for more than a year, but has the register led to real results in the detection of shell companies?

Lawyers from Taylor Wessing, who prepared the anti-shell law with the Justice Ministry, consider its first stage successful. It’s priority lays in ensuring the rapid verification and registration of companies with the state, according to Andrej Leontiev, a partner at the Taylor Wessing law firm. While the number of verified entries exceeds 13,000, the ultimate beneficial owners from Cyprus, a major hub for shell companies, only make up about 10 entries.

“This may indicate that beneficial owners have also been forced to make the owner’s structure more transparent and real,” Leontiev told The Slovak Spectator.

Application of the law, however, has revealed some of its shortcomings, like the impact on transactions where it is not expedient or legitimate and leads to the discontinuity of multiple registers. Hence, the ministry is now preparing an amendment to solve these problems.

Since the latest law came into effect, the submitter has dealt with questions related to the interpretation of ambiguous legislation and electronic services of the registry, said Slovak Justice Minister Gábor Gál.

“The submitter has solved all these inconsistencies by methodical guidance, which led to the stabilisation of some issues and techniques in practice,” Gál told the Slovak Spectator.

A systematic step

RPVS came into existence with the changes in the anti-shell legislation in February 2017. The introduction of the register was a systematic step, the importance of which is gradually increasing thanks to the increasing amount of data on the beneficiaries and introduction of further legislation, according to ethics watchdogs from the Fair-Play Alliance.

The significance is also growing with the introduction of legislation abroad, said Peter Kunder of Fair-Play Alliance.

The rest of this article is premium content at Spectator.sk
Subscribe now for full access

I already have subscription - Sign in

Subscription provides you with:
  • Immediate access to all locked articles (premium content) on Spectator.sk
  • Special weekly news summary + an audio recording with a weekly news summary to listen to at your convenience (received on a weekly basis directly to your e-mail)
  • PDF version of the latest issue of our newspaper, The Slovak Spectator, emailed directly to you
  • Access to all premium content on Sme.sk and Korzar.sk

Get daily Slovak news directly to your inbox

Top stories

News digest: Slovakia to spend three Advent weekends with testing. President wants it to be voluntary

Seven candidates for the general prosecutor post approved. Acting general prosecutor steps down.

Installation of Christmas tree in Trnava

Who was behind the sale of one of the biggest banks in Slovakia

The largest law firms were involved in several innovative projects, too.

UK nationals in Slovakia advised to take action as end of transition period nears

UK Nationals should check the British Embassy's "Living in Guide" for the most up-to-date information.

Illustrative stock photo

Three rounds of testing should take place before Christmas

The first round will be nationwide and should take place in two weeks.