Background information

The first and second COVID-19 law (ZIUZEOP and ZIUZEOP-A) introduce some changes in insolvency proceedings and compulsory dissolution. The measure aims at protecting companies from bankruptcies due to negative consequences of the epidemic. The management can abstain from the duty to start the compulsory settlement or bankruptcy until 31 August if the company became insolvent because of the epidemic. When a creditor files for a bankruptcy proceeding over a debtor, the debtor will have 4 months instead of current 2 months for financial restructuring to prevent bankruptcy. Extensions will be applicable to bankruptcy proceedings, filed for by creditors until 31 August 2020. Other changes tackle compensation of unpaid wages from the Guarantee Fund, personal bankruptcy procedures, and enforcement proceedings.

Content of measure

Deferred compulsory settlement or bankruptcy means that management is not obliged to start this procedure during the period of epidemic and the three succeeding months (until 31 August). The management can abstain from the duty if the company becomes insolvent due to the state, ministry or local authority’s ban on production or trade or if company was solvent on 31 December 2020.

On the other hand, the law reinforces some workers’ rights. Workers can have easier access to reimbursements of the Public Scholarship, Development, Disability and Maintenance Fund of the Republic of Slovenia (Guarantee Fund) for unpaid wages in the last three months, unpaid sick leave, annual leave and severance payment. Employees are entitled to compensation from the Guarantee Fund if they filed for a bankruptcy proceeding. This rule is valid until 30 June 2020. From July 2020, workers again needs court’s final decision in a bankruptcy proceeding to get access to the Guarantee Fund. Employees may have also easier access to the Guarantee Fund if they have not received wage compensations one month from the time the state paid reimbursements to their employers. In these cases, the employer is presumed no longer solvent (presumption is valid until September 2020) and employees may file for a bankruptcy proceeding. If they do so, they are exempt from paying the advance for costs of a bankruptcy proceeding.

As for personal bankruptcy and enforcement, the law stipulates that payments under emergency laws are not the object of personal bankruptcy and enforcement. Exceptions are made for wage compensation.

Finally, during the COVID-19 epidemic the enforcement proceedings are temporarily suspended. Exemptions are enforcement based on a claim for legal alimony and other urgent matters, determined by the court.

Use of measure

Emergency regulation on insolvency curbs the risks of bankruptcies on the one hand, while protects the interests of workers on the other. The exemption of payments under emergency regulation from bankruptcy estate protects persons in the personal bankruptcy procedure.

Target groups

Workers	Businesses	Citizens
Does not apply to workers	Applies to all businesses	Applies to all citizens

Actors and funding

Actors	Funding
National government	No special funding required

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	Consulted	Consulted
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:

• Unknown
• Main level of involvement: Unknown

Involvement

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

Views and reactions

Trade unions and employer organizations have submitted proposals to the law. Employers' organizations had no remarks or proposal linked to this measure. Trade unions were expressing concern all the way that employer can defer bankruptcy procedure for four months, although it does not pay salaries and social security contributions during this period. Their proposals were not taken into consideration.

Sources

• 30 March 2020: The positions of the representative trade union confederation (www.zsss.si)
• 30 March 2020: The Chamber of Commerce and Industry of Slovenia, Amendment (www.gzs.si)
• 31 March 2020: Association of Employers of Slovenia, Proposals for amendment (www.zds.si)
• 31 March 2020: The Chamber of Craft and Small Business of Slovenia, The right direction, but the law needs some change (www.ozs.si)
• 10 April 2020: Zakon o interventnih ukrepih za zajezitev epidemije COVID-19 in omilitev njenih posledic za državljane in gospodarstvo (ZIUZEOP) [Act Determining the Intervention Measures to Contain the COVID-19 Epidemic and Mitigate its Consequences for Citizens and the Economy (www.pisrs.si)
• 23 April 2020: Confederation PERGAM, Positions regarding ZIUZEOP-A and ZDLGP (sindikat-pergam.si)
• 30 April 2020: Zakon o interventnih ukrepih za zajezitev epidemije COVID-19 in omilitev njenih posledic za državljane in gospodarstvo, ZIUZEOP-A [Act Determining the Intervention Measures to Contain the COVID-19 Epidemic and Mitigate its Consequences for Citizens and the Economy (www.uradni-list.si)
• 30 December 2020: Act Determining Intervention Measures to Assist in Mitigating the Consequences of the Second Wave of COVID-19 Epidemic (Zakon o interventnih ukrepih za pomoč pri omilitvi posledic drugega vala epidemije COVID-19, ZIUPOPDVE (pisrs.si)
• 24 March 2021: IUS-INFO, Vlada podaljšala nekatere ukrepe [The government has extended some measures (www.iusinfo.si)
• 24 June 2021: Decision on prolonging the measures in the field of insolvency proceedings (Sklep o podaljšanju ukrepov na področju postopkov zaradi insolventnosti), Official Gazette, No. 43/21 and 101/2 (www.pisrs.si)