The unofficial consolidated text of the regulation serves only as an
informational working instrument, for which the authority guarantees no
compensation, or other.
on financial incentives for foreign direct investments
(unofficial consolidated text No. 1)
This Decree shall specify the objectives and the form of financial incentives
(hereinafter referred to as: incentive) for initial inward foreign direct investments, and
the conditions, criteria and procedures for the allocation of incentives.
(form of incentives)
Incentives under this Decree shall be allocated as regional state aid in the form of
grants pursuant to Commission Regulation (EC) No. 800/2008 of 6 August 2008
declaring certain categories of aid compatible with the common market in application
of Articles 87 and 88 of the Treaty (General block exemption Regulation) (OJ L No.
800/2008 of 9 August 2008, p. 3; hereinafter referred to as: Regulation 800/2008/EC)
and Article 3 of the Decree on the allocation of regional state aid (Official Gazette of
the Republic of Slovenia, No. 72/06, 70/07, 99/08 and 17/09).
(meaning of terms)
(1) The terms used in this Decree shall have the following meanings:
– an enterprise shall mean a company or individual private entrepreneur
pursuant to the act governing companies,
– eligible costs shall mean costs for which an incentive can be granted,
* The Government of the Republic of Slovenia has on its 17 regular session held on 12 March 2009
laid down the unofficial consolidated text of the Decree on financial incentives for foreign direct
investments that encompasses:
– Decree on financial incentives for foreign direct investments (Official Gazette of the Republic of
Slovenia, No. 11/07), and
– Decree amending the Decree on financial incentives for foreign direct investments (Official Gazette of
the Republic of Slovenia, No. 19/09).
– initial inward foreign direct investment shall be an investment of a non-resident
in the equity capital of a new or existing legal entity registered in the Republic
of Slovenia, if the share of the non-resident is at least 10% of the equity
– investment shall mean an investment in tangible or intangible assets relating
to the setting-up of a new enterprise, the extension of an existing enterprise,
diversification of the output of an enterprise into new additional products, or a
fundamental change in the overall production process of an existing
– tangible investments shall mean investments in tangible assets (land,
buildings and equipment; provision of site infrastructure; purchase,
construction and modernisation of buildings; purchase of new machinery and
– intangible investments shall mean investments in intangible fixed assets
(purchase of patents, licences, know-how, or unpatented technical
– large investment project shall mean an initial investment in capital assets with
eligible costs above EUR 50 million, calculated at prices and exchange rates
on the date when the aid is granted. Large investment project shall also be
considered a group of individual projects, each one of which does not reach
the value of EUR 50 million, if within three years the enterprise or enterprises
start to make individual investments in assets, which may be jointly treated in
an economically indivisible manner or mean an economic whole, with a total
value of EUR 50 million,
– job creation costs shall mean gross wage costs and compulsory social security
– aid intensity shall mean the amount of aid expressed as a percentage of
– project enterprise shall mean a company registered in the Republic of
Slovenia in which foreign investors directly participate with an ownership
interest of at least 10%,
– foreign investor shall mean a non-resident who is, or intends to become, a
holder of an investment,
– agency shall mean a public agency empowered to promote foreign direct
investments and the internationalisation of enterprises,
– region shall mean an area entitled to grants of regional state aid.
(2) The classification of companies and enterprises by size into small, medium-sized
and large under this Decree shall be subject to the criteria laid down in Annex I to
II. OBJECTIVE OF INCENTIVES
(objective of incentives)
The objective of incentives shall be to attract foreign investors to invest within the
area of the Republic of Slovenia, with the investments being for the purpose of:
– creating new jobs, in particular in branches of the economy with a higher
added value, pursuant to the labour supply in the Republic of Slovenia,
– contributing to the transfer of knowledge and technologies, and to cooperation
between scientific-research enterprises and institutions in the Republic of
Slovenia and foreign investors,
– contributing to more balanced regional development,
– contributing to increasing the synergistic effects of connecting foreign
investors with Slovene enterprises, in particular in the field of supply to foreign
investors and the exchange of know-how and technologies.
III. CONDITIONS, BENEFICIARIES AND ELIGIBLE COSTS
(types of investment for which incentives can be granted)
(1) Incentives under this Decree may be granted for investments in:
– processing activity,
– service activities whose services are subject to global marketing,
– research-development activity.
(2) Incentives under this Decree shall not be granted for investments in the following
– primary production of agricultural products listed in Annex I of the Treaty
establishing the European Community; products intended to imitate or substitute
milk and milk products; and products falling under CN codes 4502, 4503 and
4504 (cork products);
– processing and marketing of agricultural products when the amount of the
incentive is fixed on the basis of the price or quantity of such products purchased
from primary producers, or put on the market by the undertakings concerned; or
when the incentive is conditional on being partly or entirely passed on to primary
– fisheries and aquaculture,
– coal industry,
– steel sector,
– synthetic fibres,
– production of arms and munitions.
(3) Incentives under this Decree shall not be granted for export-related activities, i.e.,
incentives directly linked to quantities exported, to the establishment and operation of
a distribution network, or to other current costs linked to export activities. Incentives
shall also not be granted in cases contingent upon the use of domestic over-
(4) This Decree shall not apply to enterprises which are subject to recovery
procedures for state aid paid unduly as per a European Commission decision
declaring such aid illegal and incompatible with the common Community market.
(1) An application in a public tender for the allocation of incentives under this Decree
may be filed by foreign investors, or their foreign linked enterprises, who have
experience in carrying out the activity of the project enterprise as stated in the
application in the public tender for the allocation of the incentive.
(2) The recipients of incentives shall be project enterprises.
(3) The incentive shall not be granted if:
– the investment project has already been financed for the same purpose that
includes the elements of state aids, from other state or local government
funds, or the EU budget, or if the total amount of the funds received from such
sources exceeds the maximum permissible amounts for co-financing laid
down in rules in the field of state aid,
– the foreign investor or project enterprise is insolvent,
– the foreign investor or project enterprise has inadequate capital as defined in
the Financial Operations of Companies Act (Official Gazette of the Republic of
Slovenia, No. 54/99, 110/99, 93/02 – decision of the Constitutional Court ,
114/06 – ZUE and 117/06 – ZDDPO–2),
– proceedings of bankruptcy, forced settlement or liquidation are being
instigated against the foreign investor or project enterprise on the basis of a
final court decision,
– the project enterprise is on a list of enterprises which may not be subject to
business operations with state institutions pursuant to the act governing the
prevention of corruption,
– the foreign investor or project enterprise has outstanding liabilities towards the
Republic of Slovenia,
– the project enterprise is in difficulty pursuant to the Community Guidelines on
State aid for rescuing and restructuring firms in difficulties (OJ C 244 of 1
October 2004, p. 2), and the Act Governing the Rescue and Restructuring Aid
for Companies in Difficulty (Official Gazette of the Republic of Slovenia, No.
44/07 – official consolidated text). Small and medium-sized enterprises that
operate less than three years following entry in the register shall not be
considered as enterprises in difficulty within the meaning of the Community
Guidelines on State aid for rescuing and restructuring firms in difficulties,
unless they satisfy the liquidation procedure criteria under the regulations
governing the financial operation of undertakings.
(condition of necessity)
(1) When an incentive is granted to small and medium-sized enterprises the
beneficiary shall, prior to the project enterprise’s carrying out the investment project,
file an application for the allocation of the incentive.
(2) When the incentive is granted to large enterprises, the beneficiary shall satisfy the
conditions referred to in the preceding paragraph. Before granting the individual
incentive concerned, the agency shall verify that the documentation prepared by the
beneficiary meets one or more of the following criteria:
– a material increase in the size of the enterprise or activity due to the incentive;
– a material increase in the scope of the project or activity due to the incentive;
– a material increase in the total amount spent by the beneficiary on the project or
activity due to the incentive;
– a material increase in the speed of completion of the project or activity concerned;
– in the absence of the incentive, the project would not have been carried out as
such in the region concerned.
(1) Incentives may be used for financing the following eligible costs of investments
within the territory of the Republic of Slovenia:
– costs of job creation, directly created by the investment project, calculated for
– costs of tangible investments,
– costs of intangible investments.
(2) Eligible costs of tangible investments shall also include costs related to the lease
of land and buildings; however, the leasing contract must be concluded for at least
five years from the anticipated date of the completion of the investment project for
large enterprises, and three years in the case of small and medium-sized enterprises.
As regards the lease of equipment, only the costs of the lease in the form of financial
leasing which contains an obligation to purchase the assets at the expiry of the
contract shall be taken into consideration. The lease shall be carried out under
(3) For investments in large enterprises, the costs of intangible investments are
eligible only up to a limit of 50% of the total eligible investment costs for the project.
(4) For investments in small and medium-sized enterprises, eligible costs can also be
the costs of preparatory studies and counselling related to the investment, up to 50%
of the costs actually incurred. Eligible costs shall only be the consultancy costs of
services provided by outside consultants. If the amount of the incentive for
consultancy services in favour of small and medium-sized enterprises from all
sources exceeds EUR 2 million per undertaking per project, prior individual
notification of such incentive shall be necessary.
(5) For investments in large enterprises, only purchases of new assets shall be
recognised as eligible costs.
(conditions for allocation of incentives)
(1) A receiver of incentives shall provide sources of at least 25% of the eligible costs
of tangible and intangible investments, either through its own resources or by
external financing, in a form which is free of any public support.
(2) For large undertakings, the investment project shall be maintained in the region
for at least five years after the whole investment has been completed, or three years
in the case of small and medium-sized enterprises
(3) Intangible investments shall be used exclusively in the undertaking receiving the
incentive. They must be regarded as amortizable assets. They must be purchased
from third parties under market conditions. They must be included in the assets of
the undertaking and remain, in the case of a large enterprise, in the establishment
receiving the incentive for at least five years, or at least three years in the case of
small and medium-sized enterprises.
(4) New positions shall be occupied not later than within three years of completion of
the investment. An increase in the number of new jobs shall be established as a net
increase in the number of employees compared with the average over the preceding
twelve months. In the case of large enterprises, such new positions shall remain in
the region for at least five years from the day on which the position was first filled,
and in the case of small and medium-sized enterprises, at least three years.
(minimum number of new jobs)
An incentive may only be allocated to a project enterprise which shall create, not later
than within three years of completion of the investment, at least the following number
of new jobs:
– 25 in processing activity,
– 10 in service activity,
– 5 in development-research activity.
IV. AMOUNT OF INCENTIVES
(intensity of incentives)
(1) For large enterprises, the incentive allocated is eligible only up to a limit of 30% of
the total eligible investment costs or jobs created in relation to the investment.
(2) The upper limit of the amount of the incentive allocated fixed pursuant to the
preceding paragraph may be increased by 10 percentage points for incentives
awarded to medium-sized enterprises, and 20 percentage points for incentives
awarded to small enterprises.
(amount of incentives for a large investment project)
(1) The maximum permissible amount of incentive for a large investment project shall
be fixed as follows:
– for the part up to EUR 50 million of the value of eligible costs, 30% of the value of
eligible costs of the investment shall be taken into consideration,
– for the part between EUR 50 million and EUR 100 million of eligible costs, 15% of
the value of eligible costs of the investment shall be taken into consideration,
– for the part of over EUR 100 million of the value of eligible costs, 10.2% of the
value of eligible costs of the investment shall be taken into consideration.
(2) Large investment projects shall not be eligible for bonuses for small and
medium-sized enterprises as laid down in the second paragraph of Article 11 of this
(3) If the total amount of incentive from all sources exceeds 75% of the maximum
amount of incentive an investment with eligible costs of EUR 100 million could
receive, applying the standard upper aid threshold in force for large enterprises in the
approved regional aid map on the date the incentive is to be granted, a prior
individual notification of the incentive for large investment projects to the European
Commission shall be necessary.
(4) An incentive up to the amount laid down in the third paragraph of this Article, and
granted on the basis of the state aid scheme, shall be exempt from the notification
requirement to the European Commission. Within ten days of the allocation of such
incentive to the large investment project, the manager of the state aid scheme shall
report to the ministry of finance the information as provided for in Annex II of
(cumulation of aid)
(1) Allocation of the incentives that fall under the control from the viewpoint of state
aid shall be subject to the ceiling of co-financing the eligible costs within individual
measures, irrespective of from which public funds the aid have been allocated for an
individual purpose, and whether the aid has been allocated within several schemes
or individual aids at the same time. The allocation of incentives shall not be combined
with de minimis incentive in relation to the same eligible costs if this would result in
exceeding the highest incentive intensity referred to in Articles 11 and 11.a of this
Decree. All aid shall be added together.
(2) The incentives for tangible and intangible investments, and for creation of new
positions associated with the investment, may be combined by taking into account
the intensity threshold referred to in Articles 11 and 11.a of this Decree.
(3) When an enterprise receives aid in the form of venture capital, and requires the
aid under this Decree within the first three years after the receipt of the venture
capital, the maximum permitted aid intensity can be up to 24% of the eligible costs for
investments or positions created, associated with the investment for large
enterprises. Such a ceiling may be raised by 8 percentage points for medium-sized
enterprises, and 16 percentage points for small enterprises. Considering consultancy
costs for small and medium-sized enterprises, the maximum permitted aid intensity
may be up to 40% of consultancy costs. When the difference between the maximum
permitted aid intensity under Article 11 of this Decree and this paragraph exceeds the
total amount of the invested venture capital, the maximum permitted amount of aid
allocated under this Decree shall be decreased merely by the amount of the invested
(minimum amount of investment)
(1) The minimum amount of investment in processing activity which can be granted
incentives shall be EUR 1 million. In a call for tenders, the agency may lay down a
higher minimum amount of investment in respect of a certain statistical region by
considering its development.
(2) The minimum amount of investment in the service or development-research
activity which can be granted incentives shall be EUR 0.5 million.
V. CRITERIA AND PROCEDURE FOR ALLOCATION OF INCENTIVES
(power for allocation of incentives)
The agency shall have the power to allocate incentives under this Decree, except for
incentives allocated by the Government of the Republic of Slovenia in accordance
with Article 22 of this Decree.
(criteria for allocation of incentives)
When deciding on the allocation and amount of incentives, the agency shall apply the
– amount of investment,
– references of the foreign investor, including its credit classification and credit
rating, business reputation, and experience in investing and conducting the
activity of a project enterprise, including the market position of the investor in
the branch in its domestic market and in foreign markets,
– effect of the investment on the environment,
– registered office, employment, and conducting the activity of a project
enterprise in less developed statistical regions,
– number and duration of new positions,
– contribution of investment to the development of human capital in the state
and in less developed statistical regions,
– scale of operations envisaged,
– value added, and value added per employee created in the project enterprise,
– transfer of technologies, know-how and experience significant in the light of
the development of the enterprise, industry and the national economy.
(issuing notice of a public tender)
(1) Incentives are allocated on the basis of a public tender published by the agency in
the Official Gazette of the Republic of Slovenia and on its website.
(2) On the day of publication of the tender, the agency shall publish the project
documentation on its website.
(3) Before the publication of the public tender and project documents, the agency
shall obtain written consent from the ministry of economy.
(contents and conditions of public tender)
(1) The publication of the public tender shall include, in particular:
– name and registered office of the agency providing for the allocation of
– legal basis for the implementation of public tender,
– subject of the public tender,
– indication of the conditions and criteria for the allocation of incentives,
– indicative amount of funds available,
– determination of the period for spending the incentives, or time limits if a
staggered allocation of funds is envisaged,
– opening date of applications, or opening dates of applications if the public
tender provides for a staggered allocation of incentives,
– time limit for the submission of applications for the allocation of incentives,
– time limit for informing the potential recipients of the results of public tender,
– place, time and name of the person where those interested can collect project
(2) The project documents prepared by the agency shall be in Slovene and English
(1) The director shall appoint an evaluation commission (hereinafter referred to as:
commission) to make an expert evaluation of the investment and create a proposal
for the allocation of the incentive, which shall consist of a president and at least four
(2) The president and members of the commission shall be appointed by the director
from among experts in the agency, ministries of economy, finance, labour, science
and technology, and experts in the field of investments, industrial policy, finance,
international economic relationships, technology, enterprise management, and
intellectual property rights.
(3) At least three representatives of the ministry of the economy shall be appointed to
(4) The president and members of the commission shall provide the director of the
agency with written notification of any eventual connections with the foreign investor
and on other connections of interest which could influence their evaluation.
(decision-making by the commission)
(1) When deciding on and creating a proposal for the allocation of incentives, the
commission shall also take into account, in addition to the provisions of this Decree,
the conditions of the public tender.
(2) If it is not stipulated otherwise by the commission's rules of procedure, the
decision on the proposal for the allocation of incentives shall be adopted with an
absolute majority of votes.
(approval of incentive)
(1) Based on the commission's proposal, the agency shall, not later than within 60
days of the bid opening, inform the applicant with a resolution on the allocation of the
(2) Allocation of an incentive exceeding EUR 2 million shall require a prior approval
from the Government of the Republic of Slovenia.
(contract on allocation of incentive)
(1) The agency shall conclude a contract with the project enterprise in order to
regulate the project enterprise's obligations.
(2) The contract referred to in the preceding paragraph shall include in particular:
– indication of aid scheme which is the basis of the incentive allocation,
– intensity of the incentive,
– type of eligible costs,
– amount of incentive,
– conditions, time limits and method of payment of incentive,
– recipient's obligations as to reporting on the implementation of the investment
and access of the agency to the information necessary to monitor and
evaluate the effectiveness and eligibility of incentives allocated,
– recourse eligibilities of the agency and eventual security deposits if the
incentives are used contrary to this Decree or provisions of the contract.
(3) If the project enterprise does not sign the contract within 60 days following the
receipt of the resolution referred to in the first paragraph of Article 20 of the contract,
the incentive shall be considered as not allocated.
(1) Upon a proposal by the ministry of economy, the Government of the Republic of
Slovenia may also grant incentives without public tender if:
– the investment is to result in the number of created positions increasing by 50%
more than provided for in Article 10 of this Decree, or
– the amount of investment is more than EUR 12 million, or
– upon the evaluation of the commission referred to in the third paragraph of this
Article, the investment will make a significant contribution to the development of
the Slovene economy.
(2) Besides the conditions referred to in the preceding paragraph, the allocation of
incentives shall be, on the basis of the preceding paragraph, also subject to all other
conditions and criteria provided for by this Decree.
(3) Satisfying the conditions and criteria referred to in the preceding two paragraphs
shall be established and evaluated by a special commission of three members
appointed by the minister of economy with a view to evaluating every investment.
(4) Members of the special commission referred to in the preceding paragraph shall
provide the minister of the economy with a written notification of any of their eventual
connections with the foreign investor and on other connections of interest which
could influence their evaluation.
VI. MONITORING OF ALLOCATED INCENTIVES
(keeping records and reporting on incentives allocated)
The agency shall keep a record of the incentives allocated. The record shall include
information on recipients, the form of incentives allocated, type of eligible costs,
amount of incentives, conditions and time limits for payment of incentives, and on the
realisation of the objectives set. The agency shall report to the ministry of economy
on the incentives allocated. The agency shall prepare a half-yearly report for the
current year by 31 June, and an annual report for the preceding year by 20 January.
(monitoring effectiveness of incentives allocated)
On the basis of information communicated by the agency, the ministry of the
economy shall report to the ministry of finance on an annual basis on the realisation
of contracts concerning the allocation of incentives, and on the effectiveness of the
allocation of incentives pursuant to the Decree on the communication of data and
reporting on awarded state aids and aids according to the „de minimis“ principle
(Official Gazette of the Republic of Slovenia, No. 61/04 and 22/07).
The Decree on financial incentives for foreign direct investments (Official
Gazette of the Republic of Slovenia, No. 11/07) includes the following
transitional and final provisions:
„VII. TRANSITIONAL AND FINAL PROVISIONS
(conclusion of ongoing procedures)
The procedures for the allocation of incentives for investments which were initiated
prior to the coming into force of this Decree shall be completed pursuant to the
regulations that applied prior to its coming into force.
(cessation of validity)
On the day this Decree enters into force, the Decree on financial incentives for
foreign investments (Official Gazette of the Republic of Slovenia, No. 66/05) shall
cease to be valid.
(coming into force of the Decree)
This Decree shall come into force on the day following its publication in the Official
Gazette of the Republic of Slovenia.“
The Decree amending the Decree on financial incentives for foreign direct
investments (Official Gazette of the Republic of Slovenia, No. 19/09) includes
the following final provision:
This Decree shall come into force on the day following its publication in the Official
Gazette of the Republic of Slovenia.“