Factsheet for case SI-2020-11/447 – Updated – measures in Slovenia
|Country||Slovenia , applies nationwide|
|Time period||Temporary, 13 March 2020 – 31 March 2021|
|Type||Legislations or other statutory regulations|
Supporting businesses to stay afloat
– Deferral of payments or liabilities
|Author||Maja Breznik (University of Ljubljana) and Eurofound|
|Case created||10 April 2020 (updated 22 January 2021)|
The 'Intervention Measure Act on Deferred Payments of Borrowers' Obligations (ZIUOPOK, adopted on 20 March 2020) determines postponement of debt repayment for twelfth months. The next law (‘Act Determining the Intervention Measures to Contain the COVID-19 Epidemic and Mitigate its Consequences for Citizens and the Economy’, ZIUZEOP), adopted on 2 April 2020, offers state guarantees for the repayment of debt. From a general point of view, the deferral of payments, in the Slovenian legal framework, is an emergency measure for preventing severe economic damage and preserving financial stability in the Republic of Slovenia. It determines the postponement of outstanding debt for twelfth months. The measure concerns companies, farmers, not-for-profit organizations, and individual persons. The temporary failure of debt service must be a consequence of the epidemic. Company or person can apply for postponement of payments to the bank within six months after the end of the state of emergency. The borrower is obliged to monthly reporting on solving financial difficulties.
Intervention Measure Act on Deferred Payments of Borrowers' Obligations (ZIUOPOK, adopted on 20 March 2020) determines postponement of debt repayment for twelfth months. The next law (‘Act Determining the Intervention Measures to Contain the COVID-19 Epidemic and Mitigate its Consequences for Citizens and the Economy’, ZIUZEOP), issued on 10 April 2020, offers state guarantees for the repayment of debts. Guarantees may amount to 25% of installments for which the bank and the creditor agreed to postpone. They may amount to 50% for individual persons or companies whose activities were closed down by state or local authorities during the pandemic. Guarantees also apply to newly settled credits intending to provide liquidity for business firms. The total sum of the guarantee fund is €200 million.
Deferred payments of debt and state guarantees address the needs of companies, farmers, not-for-profit organisations, and individual people. A bank which does not consent to the justified request for the postponement of borrower’s obligations can be fined up to €250,000. State-owned SID Bank administers the state guarantees. Bank of Slovenia and Market Inspection survey and control the implementation of the two laws. For the duration of the deferral of payments, the company cannot pay profits, performance bonuses, and any financial liabilities to the parent or affiliated companies or owners. Companies ‘in difficulties’ are excluded from state guarantees.
The Bank of Slovenia reports that Slovenian banks have received 23,100 requests for deferred payments of borrowers' obligations from business and physical persons. Three-quarters of demands were submitted in April, the first month since the validity of the law. Then after, filing of claims slowed down with the improvement of the economic situation. While the total amount of credits in question is €2.5 billion, the amount of deferred instalments is €333 million. Banks have already approved most of the requests for deferred payments of borrowers' obligations.
Up to July 2020, businesses have also filed 1,200 requests for new liquidity loans, related to the COVID-19 epidemic. Their total value is €668 million. Half of them has been already approved.
In the same time, banks contracted three government-guaranteed loans, worthy €16.5 million. The Bank of Slovenia estimates that most of the liquidity loans will be transformed into government-guaranteed loans.
|Does not apply to workers||Applies to all businesses||Does not apply to citizens|
Company / Companies
Social partners' role in designing the measure and form of involvement:
|Trade unions||Employers' organisations|
|Form||Any other form of consultation, institutionalised (as stable working groups or committees) or informal||Any other form of consultation, institutionalised (as stable working groups or committees) or informal|
Social partners' role in the implementation, monitoring and assessment phase:
The two COVID-19 laws (ZIUZEOP and ZIUZEOP-A) were adopted under an accelerated procedure with no involvement of the Economic and Social Council. Its functioning was blocked because the new government, which came to power on 13 March 2020, had not appointed its members in the Economic and Social Council. On 20 April, trade unions protested against the exclusion of social partners in the preparation of the second emergency law (ZIUZEOP-A). They demanded the reactivation of the Economic and Social Council. The first meeting of the Economic and Social Council was held not before 15 May 2020. The Council then became involved in negotiations about the third emergency law ZIUOOPE, issued on 30 May 2020.
They proposed changes to the law.
Eurofound (2020), Deferred payments of borrowers' obligations and state guarantee, case SI-2020-11/447 (measures in Slovenia), COVID-19 EU PolicyWatch, Dublin, http://eurofound.link/covid19eupolicywatch
Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process. All information is preliminary and subject to change.