1. The New Union Customs Code 2. Amendment of the Act on Administration of Taxes Amendment of the Income Tax Act 3. Prepared amendment of the Act on Value Added Tax 4. Obligatory activation of electronic mailboxes from 1 August 2016 5. Simple Joint-Stock Company, Breakthrough for venture capital in Slovakia

1. IB Service
Grant Thornton Newsletter
September 2016
Topic
1. The New Union Customs Code
1
1. The New Union Customs Code
2. Amendment of the Act on Administration of Taxes
Amendment of the Income Tax Act
3. Prepared amendment of the Act on Value Added Tax
4. Obligatory activation of electronic mailboxes from 1 August 2016
5. Simple Joint-Stock Company, Breakthrough for venture capital in Slovakia

2. • Council Regulation (EC) No. 1186/2009 setting up a Community
system of reliefs from customs duty
• Common Customs Tariff.
3. e-Customs
It must be noted that as the electronic communication among the
customs authorities is not technically ensured, according to the
Commission Delegated Regulation (EU) No. 2016/341 the customs
administration will use procedures and forms according to old
regulations on a transitional basis until 31 December 2020 at the latest.
The new Community Customs Code (hereinafter “CCC”) entered
into force within the territory of the European Union on 1 May
2016. Its adoption is regarded as an important milestone in the
area of customs regulations of the European Union. In the
following article we inform you about some news brought by the
new CCC and related implementing regulations.
1. Objectives of CCC
The new CCC pursues the following objectives:
• Simplification of the rules in the customs area and increasing of
The New Community Customs Code
2
regulations on a transitional basis until 31 December 2020 at the latest.
4. Centralized clearance
The ambition of the new customs regulations effective from 1 May
2016 is to introduce so-called “centralized clearance”, in which one
customs clearance procedure will be conducted at two customs
authorities: the releasing customs authority (to which the customs
declaration was submitted) and the checking customs authority (to
which the goods were submitted for checking).
For example, a Slovak entrepreneur learns that goods it wishes to
import to the EU are situated in Hamburg. Instead of submitting the
customs declaration in Germany or through a representative, the
entrepreneur will be able to apply for clearance of the goods in
Hamburg by submitting the customs declaration with the customs
authority in Slovakia.
• Simplification of the rules in the customs area and increasing of
their effectiveness
• Full transition from paper communication to electronic
communication (so-called “paperless” customs system)
• Strengthening of the position of authorized economic operators
(SHS/AEO)
• Introduction of a new hierarchy of customs regulations.
2. Hierarchy of customs regulations in the European Union
From 1 May 2016 the hierarchy of customs regulations in the
European Union consists of:
• CCC - Regulation (EU) No. 952/2013 of the European
Parliament and of the Council
• Commission Delegated Regulation (EU) No. 2015/2446
• Commission Implementing Regulation (EU) No. 2015/2447
• Commission Delegated Regulation (EU) No. 2016/341

3. 7. Right of to be heard
The new in the customs procedures is so-called “right to be heard” by
a customs authority. It will always be applied before the issue of
a decision adversely affecting the applicant. It means that before
issuing such decision the customs authority shall always inform the
applicant about the reasons underlying the decision of the customs
authority, and allow the applicant to submit comments. In this manner
it will be possible to avoid the issuance of negative decisions by the
customs authority, against which an appeal could be lodged. The
customs authority will thus learn comments of the applicant to the
findings before issuance of the decision and can take them into
account in its decision-making.
However, the introduction of centralized clearance into the
practice will be postponed until the moment when the respective
information systems at the individual customs administrations of
the European Union are put into operation.
5. Authorized economic operators
As regards so-called “authorized economic operators
(SHS/AEO)“, according to the new legislation the customs
authorities will be entitled to issue two types of authorizations:
• Authorization for simplified procedures, which allows the holder
to use certain simplified procedures according to customs
regulations, and
• Authorization for the area of security and safety, which entitles
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8. Validity of decisions relating to binding information
On the basis of CCC the period of validity of decisions relating to
binding tariff information (“decisions on BTI”) or decisions relating
to binding origin information (“decisions on BOI”) is reduced from 6
to 3 years.
9. Extension of validity of guarantee
In the framework of the institute of guarantee for a customs debt, the
new CCC extends the validity of a guarantee: the guarantee applies not
only to the amount of import or export duty, but also to other
payments made in respect of import or export of goods. Other
payments in connection with import mean among others VAT or
consumption taxes.
• Authorization for the area of security and safety, which entitles
the holder to use facilitations with regard of security and safety.
6. Validity of authorizations after 1 May 2016
The new customs regulations effective from 1 May 2016 provide
that authorizations issued according to preceding regulations, that
are valid on 1 May 2016 and the validity of which is not limited,
shall be revised according to the new CCC. They shall remain in
force until such revision.
On the other hand, authorizations issued according to preceding
regulations, that are valid on 1 May 2016 and the validity of which
is limited, shall remain in force until the expiration date or until 1
May 2019, whichever occurs earlier.

4. is not regarded as a customs regime; according to the new
legislation goods may remain in temporary storage for 90 days at
the most, without possibility of prolongation of this period.
12. Permanent establishment
The new CCC introduces the term “permanent establishment”. It
will mean that a legal person with registered office situated
outside the customs territory of the European Union will be
regarded as a person established within the EU customs territory,
if it has a permanent establishment within the customs territory
of the Union. The permanent establishment means a permanent
place of business with permanent presence of required human
and technical resources, through which activities of the affected
Moreover, according to the new legislation a guarantee applies to
the amount of import or export duties, which corresponds to the
customs debt, as well as to other payments made for all goods
indicated in the customs declaration or released on its basis,
irrespective of whether the customs declaration is correct or not.
It means that a guarantee can be used for customs duties and
other payments in respect of goods, which were not indicated in
the customs declaration, but which were detected by physical
check (e.g. if the goods were concealed or indicated incorrectly in
the customs declaration).
10. Customs regimes
According to the new CCC the following categories of customs
4
and technical resources, through which activities of the affected
person related to the customs system are performed fully or
partially. It must be noted that this term should be interpreted
separately and that the term „permanent establishment for
customs purposes“ should not be confused with the term
“permanent establishment for the purposes of VAT”.
According to the new CCC the following categories of customs
regimes are recognized:
• Release for free circulation
• Export
• Special customs regimes
Special customs regimes mean:
• Transit (external transit and internal transit)
• Storage (customs warehousing and free zone)
• Special use (temporary use and end-use)
• Processing (inward processing and outward processing)
11. Temporary storage of goods
It must be noted that according to CCC so-called “temporary
storage” (of goods from their submission to the customs
authority until their release for proposed customs regime)
_______
JUDr. Ing. Peter Schmidt
Križkova 9
81103 Bratislava
T +421 2 593 004-74
F +421 2 590 004-10
E peter.schmidt@sk.gt.com

5. Strengthening of preliminary measures through so-called
“super-securing order”
If the tax administrator reasonably assumes that the tax not due or not
assessed will not be paid or become enforceable by the maturity date
and that the amount determined by the tax administrator as security
deposit will probably not be paid, it may issue a decision imposing on
the taxpayer to pay a security deposit on account of the tax
administrator, or limit the taxpayer´s right to dispose of the assets
specified in the decision. Such decision issuing a preliminary measure
will constitute an execution title, i.e. it will be immediately enforceable.
The Ministry of Finance (“MF SR“) has prepared a draft
amendment of the Act on Tax Administration, to be effective
from 1 January 2017, as well as amendment of the Income Tax
Act. The main changes proposed in the amendments are listed
below.
Introduction of the new institute “reduced assessment
procedure”
The amendment introduces a new method of tax assessment
applicable in a reduced assessment procedure in cases where a
taxpayer does not remove the deficiencies affecting the amount of
Amendment of the Act on Administration of Taxes
5
Extension of tax execution
In case of tax execution proceedings the prepared amendment
introduces the possibility of tax execution against persons different
from the tax debtor, e.g. members of the VAT group.
taxpayer does not remove the deficiencies affecting the amount of
the tax in the tax return within a time-limit determined in the
request of the tax administrator. The tax administrator in this case
will issue the tax assessment order instead of determining the tax
using tools. The tax assessment order will be issued on the
condition that the tax audit has not been initiated in the case. The
taxpayer can lodge a justified appeal against the tax assessment
order; in this case the standard process of tax assessment (tax
audit and tax assessment procedure) will be initiated.
Amendment of the Income Tax Act
-resident, if such natural person is actual owner of these dividends.
This rate may be later decreased on the basis of a double tax treaty.
Introduction of the tax on dividend – effective from 1
January 2018
The amendment proposes the application of the withholding tax
of 15% to the amount of dividends (not decreased by expenses)
paid to a natural person, whether Slovak tax resident and non-
´´´´

6. 4. the respective activity does not have an economic
justification.
No transitional provision is provided for this provision.
The amendment also provides conditions under which the
taxpayer may apply the tax administrator for approval to the use
of a specific transfer pricing method. As the amendment does
not provide that the tax administrator shall approve the arm´s
length character of prices used in transactions with dependent
persons, the extension of the provisions on approval of a specific
transfer pricing method has minimum practical importance.
As regards legal persons, paid dividends (not decreased by
expenses) will be encumbered by the tax at the rate of 35% for
Slovak tax residents in the following cases:
1. They are paid by a taxpayer from a non-contracting State (State
not appearing in the list of contracting States issued by MF
SR), and
2. The Slovak tax resident is actual owner of these dividends, i.e.
it can use the dividends without obligation to transfer them to
a third party.
The withholding tax at the rate of 35% will also be applied to
dividends paid by Slovak tax resident to a taxpayer from a non-
contracting State, who will also be their actual owner.
6
contracting State, who will also be their actual owner.
Reduction of the corporate income tax rate - effective from 1
January 2017
The amendment proposes a reduction of the corporate income tax
rate from 22% to 21%. The reduced tax rate will be applicable to
the tax periods beginning not sooner than on 1 January 2017.
Completion of provisions in the area of transfer pricing
The amendment introduces the possibility of doubling the fine
(which may be imposed according to the Act on Tax
Administration) for taxpayers who use transfer pricing in order to:
1. evade the tax, or
2. gain a tax advantage, to which they would not be eligible
otherwise, or
3. decrease their tax liability, and at the same time.
Ing. Mgr. Vladimír Kovár
Križkova 9
81103 Bratislava
T +421 2 593 004-74
F +421 2 590 004-10
E vladimir.kovar@sk.gt.com

7. This regulation will concern tax audits started after 1 January 2017, as
well as “older” tax audits not terminated as at 1 January 2017. It means
that by tax audits finished as at 31 December 2016 the compensation
claim shall not arise.
2. Application of self-taxation for import of goods from third
countries
The Ministry has revised and postponed the date of application of the
provision relating to self-taxation for import of goods from third
In August 2016 the Ministry of Finance of SR (hereinafter “MF
SR”) submitted to the government an amendment of the Act No.
222/2004 Coll. on the value added tax (hereinafter “VAT Act”).
The following changes are proposed:
1. Compensation for withholding of the overpaid tax during
tax audit
MF SR proceeds with legal regulation of compensation (interest)
for withholding of the overpaid tax during a tax audit. It is
Prepared amendment of the Act on Value Added Tax
7
provision relating to self-taxation for import of goods from third
countries. Instead of a determined date (01 January 2017) a regulation
is proposed, according to which the provisions in question would take
effect depending on the result of comparison of the data on the
amount of public debt, as published for the respective budget year by
Eurostat (the actual amount of debt of public administration of SR),
and the upper limit of debt of public administration determined for
this budget year according to the Constitutional Act No. 493/2011
Coll. on fiscal responsibility.
It means that provisions concerning self-taxation for import of goods
from third countries will not take effect from 1 January 2017, i.e. VAT
for import of goods will continue to be paid exclusively to the
customs authority in 2017.
for withholding of the overpaid tax during a tax audit. It is
proposed that the State should compensate the VAT payers, whose
overpaid tax was withheld during a tax audit, by granting them
compensation (interest) in the amount of 1.5% p.a. of the amount
of refunded overpaid tax. They will receive this compensation in
case the overpaid tax was not returned within six months from the
date, when the original legal period for refund of the overpaid tax
after submitting the VAT return has elapsed.
In simple terms, the claim for compensation will arise only if the
overpaid tax is not returned within six months since the original
period has elapsed and it will arise only for the days following the
six-months period. The rate of 1.5% p.a. will be applied. However,
the period for which compensation is provided as well as the
amount of compensation fall behind the expectations of the expert
and professional public.
____

8. 3. Reverse charge by construction work
Based on the comments from the comment procedure, the
Ministry introduces a fiction to assist by the classification of
construction works and by increasing legal certainty for
purchasers of construction works, especially if the supplier and
the customer have differing opinions about exercising of reverse
charge.
More precisely, if the provider (VAT payer) provides works and
considers these works as works that shall be reverse-charged to
the purchaser, and at the same time the invoice created by the
provider contains the exact formulation “reverse charge”, the
purchaser (VAT payer) has a personal obligation to pay the tax –
8
purchaser (VAT payer) has a personal obligation to pay the tax –
the purchaser is reverse charged.
JUDr. Ing. Peter Schmidt
Križkova 9
81103 Bratislava
T +421 2 593 004-74
F +421 2 590 004-10
E peter.schmidt@sk.gt.com

9. If a message is the subject of personal delivery such message is
regarded as delivered not later than on the last day of the 15-day
storage period.
The issue of activation of electronic mailboxes of companies with a
foreign executive is being addressed. As a foreign person does not
hold a Slovak ID card such person can use a replacement identifier for
logging in to the electronic mailbox. As the form of a replacement
identifier has not been published yet, a person with Slovak nationality
On 1 August 2016 according to Act No. 305/2013 Coll. on e-
Government all electronic mailboxes of legal persons established
for the purpose of two-way electronic communication between
public authorities and legal persons will be activated.
The electronic identification card of a person authorized to act on
behalf of the company, the identification card reader and the
allocated personal security code will be required for access to the
electronic mailbox. As many companies do not have technical
Obligatory activation of electronic mailboxes from 1 August
2016
9
identifier has not been published yet, a person with Slovak nationality
must be authorized for disposal of the electronic mailbox at the same
time.
electronic mailbox. As many companies do not have technical
equipment required for the use of electronic mailboxes, the Act
gives them a five-month transition period to get ready for smooth
transition to the electronic communication.
The process of obligatory activation starts without request of the
electronic mailbox owner by the provision of access to the
electronic mailbox on 1 August 2016. The process of electronic
mailbox activation is completed by the first logging in to the
electronic mailbox. If the first logging in does not occur before
the end of year 2016 the electronic mailbox will be automatically
activated on 1 January 2017. From this date all documents
received in the electronic mailbox are regarded as delivered on the
day immediately following the date when they have been put into
an active electronic mailbox. From this moment all statutory
periods, if any, start to run.
Ing. Zuzana Ačová
Križkova 9
81103 Bratislava
T +421 2 593 004-74
F +421 2 590 004-10
E zuzana.acova@sk.gt.com

10. What makes the difference?
In a nutshell, the simple joint-stock company (j.s.a.) will be:
Lean
It is basically a lean version of the joint-stock company with a
minimum registered capital of EUR 1, a minimum nominal share value
of 1 Eurocent, and a lean structure (thus suitable also for initial
stages): a one-man board of directors is possible, a supervisory board
On 12 November 2015, the Slovak parliament adopted the
amendment of the Slovak Commercial Code, introducing a wholly
new type of legal vehicle – a simple joint-stock company (j.s.a.). As
Taylor Wessing Slovakia was among the principal drafters and
driving forces behind the adoption of this piece of legislation, and
spent many months intensively involved in its drafting,
brainstorming with the Ministry of Finance and holding expert
discussions with the Ministry of Justice, we are proud that we took
Simple Joint-Stock Company
Breakthrough for venture capital in Slovakia
stages): a one-man board of directors is possible, a supervisory board
is only optional; circular resolutions of shareholders are possible.
Flexible and contractual
This is the "heart" of the new vehicle: it gives shareholders
substantial and in the Slovak company law unparalleled freedom to
flexibly shape their relationships both on the level of
i. Articles of Association: The j.s.a. can issue various classes of shares
to which different rights may be attached (there is no explicit limit
on these rights) thus allowing the creation of various classes of
shareholders reflecting their position and time of "arrival" (e.g.
employees, founders, investors); the implementation of ESOP
schemes will be substantially easier; and
ii. Shareholders' agreements (SHA): SHAs may contain, besides any
arrangement between shareholders not prohibited by law, explicitly
regulated agreements on drag-along/tag-along right and shoot-out
(deadlock); the voluntary registration of drag along and tag along in
public registers leads to enhanced enforceability.
discussions with the Ministry of Justice, we are proud that we took
the long journey and look forward to its application.
For the first time since the adoption of the Commercial Code in
1991 (in what was then Czechoslovakia), the Slovak legislator found
enough courage to stir the stale waters of Slovak company law and
introduced a new type of corporate entity into the Slovak
corporate landscape (disregarding the mandatory and rather sloppy
transposition of EU legal vehicles - SE and European Cooperative
Society). It is also a breakthrough on another level: at last, the
Slovak legislator abandons the perpetually failing idea of protection
of creditors by tightening the rules for registered capital (the
minimum capital of j.s.a. being set at EUR 1) to which it stuck for
so long.
It should be very encouraging for the start-up community that the
aim of the new vehicle is to serve start-ups and VC investors,
though it will certainly have a much more versatile use - all forms
of joint venture projects come to mind first as natural recipients

11. User-friendly - bringing together entrepreneurs and investors
Low incorporation requirements and a simple corporate structure (with
or without supervisory board) serving initial stages and a variety of
share classes together with statutory drag-along and tag-along
regulations serving investment scenarios are designed to accommodate
both requirements of entrepreneurs as well as the goals and strategies
of investors.
Takes off in January 2017
At first sight it may be disappointing that the act will not enter into
force until January 2017; however, this (at least in Slovakia) unusually
long transitional period is necessary to establish and implement new
Transparent
Electronic registration of all shares and their transfers; list of
shareholders available online in a public register kept by central
securities depositaries.
Private
The simple joint-stock company cannot go public or offer
subscription of shares publicly without prior transformation to a
regular joint-stock company; the reason behind this is to avoid an
application of several restrictive obligations concerning the
maintenance of capital stipulated in the Second Company Law
Directive.
JUDr. Radovan Pala
long transitional period is necessary to establish and implement new
public registries that will be kept with the central securities depositaries.
In the meantime, it will be a crucial safeguard that the registration fees
will be set at a reasonably low level.
Directive.
Self-enforcing
Insofar as it provides protection to VC through the self-enforcing
nature of a registered drag-along right that will allow to execute the
drag along without being forced to initiate court/arbitration
proceedings. We also expect that the explicit regulation of
arrangements in SHA in combination with an application of the
new Slovak Arbitration Act (2015) and arbitration courts in Slovakia
on shareholders' disputes can change the situation and lead to
effective and timely enforcement of shareholders rights (founders or
investors).
Bratislava
Panenská 6
SK-81103 Bratislava
T +421 2 5263 2804
F +421 2 5263 2677
E bratislava@taylorwessing.com
JUDr. Andrej Leontiev

12. SLOVAKIA
(Bratislava | Prešov)
IB Grant Thornton
Križkova 9
SK-811 04 Bratislava
T +421 2 593 004-00
F +421 2 593 004-10
E office@sk.gt.com
IB Grant Thornton
Floriánova 2
Grant Thornton
12
SK-080 01 Prešov
T +421 51 7710 328
Ing. Silvia Hallová
Tax Partner
Dr. Wilfried Serles
Managing Partner