Establishing a limited liability company (s.r.o.) if you have ongoing debt enforcement (executions)

Effective as of October 1, 2020, a person who has executions (seizures) cannot be an executive (konateľ) of an s.r.o. (LLC). This follows from Section 133, Paragraph 2 of the Commercial Code, according to which: “Only a natural person who, at the time of entry into the Commercial Register, is not listed as an obligor in the register of authorizations to perform execution according to a special act, can be an executive of the company.”

The aforementioned restriction also applies to other persons acting in an s.r.o., including the founder: “A limited liability company cannot be established by a person who is listed in the list of tax debtors according to a special act or has recorded arrears on social insurance premiums according to a special act; this does not apply if the relevant tax administrator, which is the tax office or the customs office, grants consent for the establishment of the company. The consent is attached to the motion for entry into the Commercial Register. A limited liability company cannot be established even by a person who is listed as an obliger in the register of issued authorizations to perform execution according to a special act.”

According to Section 115, the restriction also applies to the transferor and the acquirer during the transfer of a business interest: “A partner cannot transfer their business interest to another partner or another person if proceedings for the dissolution of the company are being conducted against the company, if the company is dissolved by a court or on the basis of a court decision, or if the effects of a declaration of bankruptcy or authorization of restructuring apply to the company. A partner cannot transfer their business interest to another partner or another person even if they are listed as an obliger in the register of issued authorizations to perform execution according to a special act… A person who is listed as an obliger in the register of issued authorizations to perform execution according to a special act cannot acquire a business interest in a limited liability company by transfer; the aforementioned applies equally regardless of the fact of whether the acquirer of the business interest is to be another partner of the company or another person.”