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Administrative costs estimation - Ministrstvo za javno upravo Powered By Docstoc
					                                REPUBLIC OF SLOVENIA
                         MINISTRY OF PUBLIC ADMINISTRATION
                Directorate for e-Government and Administrative Processes




ADMINISTRATIVE COSTS ESTIMATION
    Simplification of the process of foundation, change or
      liquidation of an enterprise (simple limited liability
   companies) with the establishment of e-VEM information
               system for commercial companies




                                           Version 1.2

                                          March 2008
Organisation:                 Ministry of Public Administration


                                                                            1
Title of the activity:                              Administrative costs estimation – Simplification of the process of foundation,
                                                    change or liquidation of an enterprise (simple limited liability companies) with
                                                    the establishment of the e-VEM information system for commercial
                                                    companies
Creation date:                                      21.02.2008
Last changed:                                       06.03.2008
Document status:                                    final version
Document version:                                   1.2
Author of the document:                              Matija Kodra, Slavko Patekar



                     ADMINISTRATIVE COSTS ESTIMATION REPORT
                 Simplification of the process of foundation, change or liquidation of an enterprise

                          (simple LLC) with the establishment of the e-VEM information system

                                                         for commercial companies

Table of contents

1.0 INTRODUCTORY EXPLANATIONS..………………………………………………………………………………….3
1.1 Legislative frame (http://zakonodaja.gov.si)....................................................................................................... 3

1.2 Changes in procedures for registration of a simple new c.c., procedures for changing or liquidating an existing
c.c., following the establishment of unified VEM system entry points ...................................................................... 4

1.3 Conditions for foundation or change of a c.c. (LLC) .......................................................................................... 5
1.4 Procedure of registration of simple new c.c., procedures for changing and liquidating an existing c.c., before
and after the establishment of unified VEM system entry points…………………………………….…………………..7

2.0 ADMINISTRATIVE COSTS ESTIMATION .......................................................................................................11

2.1 Legislative frame, definition of information obligation, administrative activity, population and frequency ........ 11

2.2 Definition of elements of administrative costs .................................................................................................. 14

2.3 Calculation and estimation of administrative costs and administrative burdens .............................................. 18

3.0 CALCULATION OF SAVINGS AFTER THE ESTABLISHMENT OF e-VEM SYSTEM AS A RESULT OF
SIMPLIFIED PROCEDURES OF COMPLETING AND TRASMITTING FORMS DEMANDED BY THE ZZZS AND
ZRSZ…………………………………………………………………………………………………………………………..25

3.1 Calculation of savings for limited liability companies………………………………………………………………...25

3.2 Calculation of savings for all commercial entities…………………………………………………………………….28
4.0 CALCULATION OF SAVINGS RESULTING FROM THE FUSION OF THE BUSINESS AND COURT
REGISTERS INTO A PUBLIC REGISTER OPEN TO PUBLIC INSPECTION……………………………………….30



Supplements

Supplement 1……..…………………………….……………………………………………………………………….….32

Supplement 2…………………………………………………….…………………………………………………………33




                                                                                                                                                       2
1.0 INTRODUCTORY EXPLANATIONS


Administrative costs estimation was carried out on the case of simplification of the process of
                                                          1                         2
foundation, change or liquidation of an enterprise (simple limited liability company ) as a result of the
e-VEM information system for commercial companies (hereinafter: c.c.) On the basis of simplification
of the process we defined information obligation and administrative activities, gathered cost
parameters and calculated:

          State before changes were introduced (before 1 February 2008)

          State after changes were introduced (after 1 February 2008).


With the establishment of the e-VEM information system for c.c. (1 February 2008) and the
introduction of new provisions to the Court Register Act and the Companies Act important
administrative obstacles were eliminated and processes opening the way to a friendly and efficient
state administration initiated. Savings can be expressed in time, which fell from an average of 6
months to merely 4 days as well as in money; savings are generated mainly due to the fact that by
implementing e-VEM a company can be created in one place (one-stop-shop system) – there are 180
entry points free of charge and 90 notaries available enabling foundation, registration,
changing and liquidation of a simple c.c. (LLC).

Administrative costs estimation was carried out on the basis of an analysis of the c.c. (simple LLC)
registration process before and after the establishment of the e-VEM information system. In the
continuation of the report processes concerning registration of a new c.c. and change and liquidation
of an existing c.c. in its form before and after the establishment of the e-VEM information system shall
be laid out. For each process an information obligation (obligatory proofs, confirmations, procedures)
is specified and for each information obligation an administrative activity. In this way administrative
costs and administrative burdens are calculated for each procedure separately. Net savings are
estimated by comparing the original state with the present.




1.1 Legislative frame (http://zakonodaja.gov.si)3


         Companies Act /ZGD-UPB1 (Official journal, nr. 15/2005) ZGD-1 (Official journal, nr
          42/2006)/

         Court Register Act /ZSReg-UPB2, Official journal, nr 54/2007/

         Commercial Register of Slovenia Act /ZPRS (Official journal, nr 13/1995) and ZPRS-1
          (Official journal, nr 49/2006)/

         Tax Administration Act /ZDS-1-UPB2, Official journal, nr 1/2007/

         Court Fees Act /ZST-UPB1, Official journal, nr 20/2004/


1
  Simple company is a commercial enterprise (LLC) in which:
      -    initial capital is paid out solely in money (by a transfer to a bank account)
      -    Initial capital is paid in full prior to registration of the foundation
      -    memorandum of association contains only the most basic stipulations and is made using the VEM form, whose
           wording cannot be changed
      -    in case of one-man LLC: the associate wishes to keep electronic Register of decisions
2
  (1) Limited liability company is a company whose initial capital is composed from subscribed contributions of associates. The
value of the contributions may vary.
3
  Complete legislation governing changes in procedures of registering newly founded companies and changes or liquidation of
existing companies at VEM entry points is available on-line at: http://evem.gov.si/gd/infoNavodila.evem/#fragment-7
                                                                                                                                  3
1.2 Changes in procedures for registration of a simple new c.c., procedures for
changing or liquidating an existing c.c., following the establishment of unified VEM
system entry points


From the point of view of administrative hurdles the following important changes have been made:

          The possibility of registering an enterprise in one place, on over 300 entry points all over
           Slovenia (Agency of the Republic of Slovenia for Public Legal Records and Related Services
           – hereinafter: AJPES, Administrative units and their local offices, Chamber of Craft and Small
           Business of Slovenia – hereinafter: OZS, Chamber of commerce and Industry of Slovenia –
           hereinafter: GZS, Tax Administration of Republic of Slovenia – hereinafter: DURS, Public
           Agency for Entrepreneurship and Foreign Investments – hereinafter: JAPTI, notaries). On 1
           February provisions of the Court Register Act and Companies Act came into force, which
           enable creation of simple limited liability companies by a completion of a VEM form. This
           means that such companies no longer need to produce notary documents endorsing their
           memorandum and articles of association – an endorsement on one of the VEM entry point
           suffices. All procedures within the e-VEM system are free of charge.

          Shortening the procedure of founding a company to only 4 days.

          Abolition of mandatory disclosure of entries in the Court register in the Official Journal
           (replaced by a publication, free of charge, on the AJPES portal), the possibility of submitting
           proposal for entry in the Court register of one-man limited liability companies by modes of
           communication at a distance – over the internet (using a qualified digital certificate) and

          Opening an electronic register of decisions for one-man limited liability companies at a
           distance, on VEM entry points or at the notary. This means that visiting the notary shall no
           longer be needed, as the certification of Register of decisions by the notary, which has been
           obligatory so far became obsolete.

          Electronic submission of forms for registering persons for social security, registration of
           changes in compulsory social security data on open files, deregistration of persons from
           compulsory social security, registration of family members for compulsory social security,
           registration of changes in family members data, deregistration of family members from
           compulsory social security and registration of a vacant work place,

          Electronic support for opening a temporary current account for companies in banks, to where
                                                         4
           the initial capital is paid (e-Current account ).

          Apart from the changes in legislation concerning foundation and change (of company name,
           seat, activity, representatives) of simple limited liability companies, additional relief in form of
           abolition of court and notary fees has been introduced. It is now also possible to submit other
           applications together with the proposal for entry in the Companies register. The Court shall
           decide on the entry in the Business register according to the list of applications entered into
           the system. Once the Court confirms the entry in the Register, the system transmits all other
           applications together with data on the company to the competent institutions. It shall be
           possible to follow the status of all submitted applications through the e-VEM portal.


In assessing administrative costs and obstacles we have performed an in-depth analysis of main
changes in areas where procedures of registration, change and liquidation are taking place
automatically through the e-VEM information system. Our reference point was real-life event of

4
  Electronic current account (e-TRR) is a web application which enables natural or legal persons to open a temporary depositary
(transaction) current account necessary for the paying-up of initial capital of the company. The paying-up of initial capital is
precondition for foundation of a company or its registration in the Court register. Associates can sign up into the e-TRR portal by
using one of the following qualified digital certificates: SIGOV-CA ali SIGEN-CA, POŠTA®CA, AC-NLB in HALCOM CA.
                                                                                                                                 4
founding a company (simple LLC) and change and liquidation of a company (simple LLCs).
Administrative costs and burdens were calculated using information gathered from individual bodies
and companies included in aforementioned processes.


1.3. Conditions for foundation or change of a c.c. (LLC)

Foundation of a c.c.:

Proposal for registration of a newly founded LLC can be submitted at the VEM entry point in the
following cases:


       When share capital is paid in money (by a bank transfer) and when the complete initial share capital (a
        minimum of 7500 EUR) is paid before submitting the proposal and

       Memorandum and articles of association are composed using the VEM form, whose wording can not be
        changed and

       In case of one-man LLCs: the associate keeps the electronic register of decisions.


Procedures connected to founding an enterprise have to be performed before a notary in the following
cases:


       Concerning share capital – Should associates intend to pay it in form of:
        - assets other than money (e.g. machines, immovable property, equipment) or
        - money in the sum which surpasses 7500 EUR (compare paragraph 4, Article 475 of ZGD-1), a part of
        which is to be paid after the entry of the company in the Commercial register.

       Concerning content of the contract or act (even if associates intend to invest only money, which
        would be paid in full before submitting the proposal); if it is the wish of associates (due to additional
        arrangements or other reasons) that the memorandum and articles of association be done in the form of
        a notary document.

       Concerning the form of the Register of decisions (in case of one-man LLC): the associate keeps
        the electronic register of decisions.

       if it is the intention of associates to form an enterprise with an organisational structure different
        from that of a limited liability company (such as an unlimited liability company, a limited partnership or
        a joint stock company).



Change of a c.c.:

Proposal for change of a newly founded LLC can be entered at the VEM entry point in the following
cases:


       Change, which requires a modification of the memorandum and articles of association:
        - change of name of the company (and the short version thereof), registered office or economic
        activity AND
        - the new application on the e-VEM portal contains an entry with the Register of decisions for this
        company (for one-man LLC),
        - the basic memorandum of association was concluded using the VEM form (for collective LLCs)

       Changes are being made only to data concerning representatives or business address AND
        - the new application on the e-VEM portal contains an entry with the Register of decisions for this
        company (only for one-man LLCs)

                                                                                                                  5
Procedures connected to changing an enterprise have to be performed before a notary in the following
cases:


      - change of the name of the enterprise (and the short version thereof), of registered office, of
       economic activity or of data concerning representatives when the new application on the e-VEM
       portal DOES NOT contain an entry with the Register of decisions for this company (for one-man
       LLC)

      - change of the name of the company (and the short version thereof), of registered office or of economic
       activity when the memorandum of association was not concluded using the VEM form (for collective
       LLC)

      Changes of data other than e.g. name of the enterprise, registered office, economic activity, data
       concerning representatives or business address, such as initial capital, business shares, associates
       (transfer of business shares or expulsion of associates), members of supervisory body.




                                                                                                              6
1.4 Procedure of registration of simple new c.c., procedures for changing and
liquidating an existing c.c., before and after the establishment of unified VEM
system entry points

Image 1: Process of registration of a new c.c. (simple LLC) before the establishment of e-VEM
         (before 1 February 2008)




                                                                                                7
Image 2: Process of registration of an enterprise (limited liability company) if capital was paid
         after the establishment of e-VEM (after 1 February 2008)




                                                                                                    8
Image 3: Process of changing a c.c. (simple LLC) before the establishment of e-VEM
         information system (before 1 February 2008)




Image 4: Process of changing (name of the enterprise, economic activity, a representative) of a
         c.c. (simple LLC) after the establishment of e-VEM information system (after 1
         February 2008)




                                                                                              9
Image 5: Process of liquidation of an enterprise (simple LLC) before the establishment of e-
         VEM information system (before 1 February 2008)




                                                                                               10
Image 6: Process of liquidation of an enterprise (simple LLC) after the establishment of e-VEM
         information system (after 1 February 2008)




2.0 ADMINISTRATIVE COSTS ESTIMATION

Calculations assessing administrative costs have been performed according to the Instruction on the
manner of measuring administrative costs (Ver 2.2, 31 December 2007).

2.1 Legislative frame, definition of information obligation, administrative activity,
population and frequency

Step 1.1 Legislation:

       Companies Act /ZGD-UPB1 (Official journal, nr. 15/2005) ZGD-1 (Official journal, nr 42/2006)/

       Court Register Act /ZSReg-UPB2 (Official journal, nr. 54/2007/

       Commercial Register of Slovenia Act /ZPRS (Official journal, nr. 13/1995) and ZPRS-1
        (Official journal, nr 49/2006)/

       Tax Administration Act /ZDS-1-UPB2 (Official journal, nr 1/2007/

       Court Fees Act /ZST-UPB1, Official journal, nr 20/2004/

Regulation categories: B+C


                                                                                                   11
Step 1.2 Information obligation and data:

Information obligation and data for administrative costs estimation are indicated on the list of codes in
step 2.1 (definition of cost parameters).

Step 1.3 Administrative activity:

Administrative activity is performed with intent to satisfy information obligation and data demanded by
the regulations and is indicated on the list of codes in step 2.1 (definition of cost parameters).

Step 1.3a Possibility of using electronic means:

YES (partly)

Step 1.4 Population and segmentation:

Three events were taken into consideration when measuring administrative costs: founding a new
                         5
commercial company (simple limited liability company), change of an existing c.c. (simple LLC) and
liquidation of a c.c. (simple LLC).

Calculations of the population are based on the data collected by the Agency of the Republic of
Slovenia for Public Records and Services (AJPES), the Supreme Court, the Statistical Office of the
Republic of Slovenia (SURS), the Tax Administration of the Republic of Slovenia (DURS), the Health
Insurance Institute of Slovenia (ZZZS) and the Employment Service of Slovenia (ZRSZ). We have
gathered the following data for the previous year (2007): the number of newly founded simple LLCs,
the number of changes in simple LLCs and the number of liquidations of simple LLCs. Data was
gathered for all newly founded, changed or liquidated limited liability companies. The share of newly
founded simple LLCs amounted to 80% of the overall population; changes were recorded in 60% of all
LLCs. The obtained information on number of c.c. for a each event was segmented according to the
number of associates that founded an c.c.

In segmenting the information we considered differences in information obligation, which occur in
different types of LLCs, namely in case of one-man and collective LLCs. Noticeable differences can be
seen in notary attestations, as one-man limited liability companies are no longer obliged to produce a
memorandum of association in form of a notary document, whereas collective limited liability
companies no longer need confirmation for their Register of decisions.




5
  (1) According to this act a commercial company is a legal person that independently pursues an activity with a view to profit in
the market as its exclusive activity.
(2) According to this act an activity with a view to profit is any activity performed on the market in order to produce profit.
(3) commercial companies (hereinafter: company) from the first paragraph of this Article can be founded in one of the following
forms:
- as personal companies: unlimited liability company, limited partnership and dormant partnership or
- as a company with share capital: limited liability company, joint stock company, limited stock partnership and European public
limited-liability company.
(4) Companies from the previous paragraph are deemed commercial enterprises even if their activity performed within the
boundaries set by the law is not (exclusively) profit oriented.
Source: Companies Act /ZGD-UPB1 (Official Journal, nr. 42/2006 (60/2006 - corr.), 26/2007-ZSDU-B, 33/2007-ZSReg-B,
67/2007-ZTFI)
                                                                                                                               12
Table 1: Number of newly founded, changed or liquidated simple LLCs in 2007 according to the
           number of founders (associates)


                                   Limited liability               Simple limited liability
                                                                                                        Total         Total simple
                                     companies                           companies
           Event type                   6                                                               LLCs             LLCs
                                One-man       Collective           One-man      Collective
                                                                                                        (2+3)            (4+5)
                                   (2)            (3)                 (4)           (5)
                                 3.422         1.528                 2.738        1.222                 4.950             3.960
Foundation of an enterprise

Change of company (name,           9.610            8.000             5.766            4.800           17.610             10.566
  head office, economic
  activity, representative)
       Liquidation of an           1.000              936             1.000             936             1.936             1.936
          enterprise.:

    Number of procedures at
         the ZZZS7
                                        1 415 429 procedures yearly (all c.c.)                         566.172
  Number of vacant work
places or types announced              158.543 procedures yearly (all c.c.)                     63.417
          (ZRSZ)
Source: AJPES (data for 2006 and 2007), DURS, ZZZS, ZRSZ, OZS (Chamber of Craft of Slovenia), GZS (Chamber of
Commerce and Industry of Slovenia).


Administrative costs were calculated according to the following criteria:
       -     According to the event type (foundation, change, liquidation)
       -     According to the number of associates (one-man or collective)
       -     Before and after the establishment of the e-VEM information system

The final calculation consisted in summing up costs gathered according to indicated criteria. In this
way we obtained the total sum of administration costs suffered by the economic subjects on the
market caused by the legislation before and after the establishment of the e-VEM system. Calculations
revealed also net savings of commercial entities as a result of the establishment of e-VEM system.

Step 1.5 Specifying frequency of administrative activity:

For the purposes of calculating administrative costs each separate administrative activity in all models
was defined as a singular event.

Step 1.6 Determining existence of external costs:

Existence of external costs can be directly seen from the data obtained from the companies (see Step
2.1)




6
  (1) A company can be founded by one or more natural or legal persons which by founding a company become associates.
Source: Companies Act /ZGD-UPB1 (Ur. l., nr. 42/2006)
7
  Registering persons in compulsory social security programs (M-1 form), registering changes of data concerning compulsory
social security on open insurance files. (M-3), deregistration from compulsory social security (M2), registration, change or
deregistration of family members from compulsory health insurance (M-DČ)
                                                                                                                               13
2.2 Definition of elements of administrative costs

Step 2.1 Definition of cost parameters

Table 2: List of IO and AA codes for newly founded, changed and liquidated LLCs before
       introducing e-VEM (before 1 February 2008)

ADMINISTRATIVE                                                                   Administrative activity (AA)
                             FOUNDATION of LLC - IO
    BODY
                                                                               Company name inquiry (AA-1.1)


                 Drawing up a memorandum of association (IO-1)                  Acquaintance with IO (AA-1.2)


                                                                                Document elaboration (AA-1.3)

                                                                          Submission of memorandum of association
                   Attestation by a notary of the memorandum of                          (AA-2.1)
                                     association
                                        (IO-2)                          Elaboration and attestation by the notary of the
                                                                            memorandum of association (AA-2.2)
       NOTARY




                                                                                      Attestation (AA-3.1)
                      Manager signature authentication (IO-3)


                  Confirmation of the Register of decisions of the             Confirmation of register (AA-4.1)
                                  company (IO-4)

                   Elaboration of a proposal for entry in the Court              Proposal elaboration (AA-5.1)
                                   register (IO-5)

                                                                        Submission of the memorandum of association
                                                                                          (AA-6.1)

                                                                                 Application for entry (AA-6.2)
       BANK




                 Request for opening a temporary current account
                                      (IO-6)                                  Conclusion of the contract (AA-6.3)

                                                                         Obtaining confirmation on the paid-up capital
                                                                                          (AA-6.4)
     REGISTER




                                                                          Filling up the application for entry (AA-7.1)
      COURT




                 Submission of the application for entry in the Court
                                  register (IO-7)

                                                                             Submission of necessary documents
                                                                                  (See Image 1) (AA-7.2)
     JOURNAL
     OFFICIAL




                   Publication of the LLC in the Official Journal of    Publication in the Official Journal of Republic of
                             Republic of Slovenia (OI-8)                                Slovenia (AA-8.1)




                              Stamp elaboration (OI-9)                            Stamp elaboration (AA-9.1)


                                                                            Filling up the PRS-1 form (AA-10.3)
                                                                        Submission of the decision on entry in the Court
       AJPES




                                                                                           register
                       Application for entry in AJPES (IO-10)                             (AA-10.2)

                                                                          Transmitting the documentation (AA-10.3)




                                                                                                                          14
    BANK
                Application for opening a permanent current
                                                                          Conclusion of the contract (AA-11.3)
                               account (IO-11)



             Application for assignment of a tax identification
                                                                      Obtaining and filling up the form (AA-12.1)
   DURS


              number, entry in the tax register and entry in
                       Register of taxable persons
                                  (IO-12)                                   Transmitting the data (AA-12.2)

                                                                   Obtaining and filling up the PD-1 form (AA-13.1)
            Declaring a vacant work place using the PD form
   ZZP




                                (IO-13)                                  Submission of the PD form (AA-13.2)
   ZZZS




                Registering a worker for health insurance
                                                                    Obtaining and filling up the M-1 form (AA-14.1)
                                (IO-14)


                                                                             Administrative activity (AA)
                          CHANGE of LLC - IO

             Corrections to the memorandum of association              Corrections to the memorandum (AA-1.1)
                                 (IO-1)
   NOTARY




                                                                  Submission of corrections to the memorandum (AA-
                Adopting a decision on corrections to the
                                                                                         2.1)
                  memorandum of association (IO-2)

                                                                  Elaboration and acquisition of the confirmation (AA-
                Obtaining attestation by the notary (IO-3)                                3.1)
 REGISTER




                                                                      Acquisition of a decision on changing the
  COURT




            Application for change of LLC in the Court register   memorandum of association and a confirmation by
                                  (IO-4)                          the notary; elaboration of a decision on change of
                                                                       the LLC in the Court Register (AA-4.1)
JOURNAL
OFFICIAL

 of RofS




             Publication of changes in the Official Journal of
                                                                       Transmitting data for publication (AA-5.1)
                       Republic of Slovenia (OI-5)


                                                                  Submission of the decision on changes in the Court
   AJPES




               Transmission of data on changes to AJPES                           register (AA-6.1)
                                 (IO-6)                                   Filling up the PRS-1 form (AA-6.2)
                                                                       Transmitting the documentation (AA-6.3)

                       LIQUIDATION of LLC - IO                               Administrative activity (AA)


                                                                    Obtaining and filling up the declaration (AA-1.1)
   ZZZS




            Deregistration of persons from compulsory social
                              security (OI-1)                            Transmitting the declaration (AA-1.2)

                                                                        Elaboration of the notarial act (AA-2.1)
   NOTARY




                     Obtaining the notarial act (IO-2)
                                                                   Elaboration of the decision on liquidation (AA-2.2)



             Elaboration of a statement on liquidation for the           Elaboration of the statement (AA-3.1)
   DURS




                            records of DURS
                                   (IO-3)                                 Transmitting the statement (AA-3.2)
 REGISTER
  COURT




              Application for deletion of LLC from the Court
                                                                    Filling up the application for liquidation (AA-4.1)
                               register (IO-4)



                                                                                                                      15
    JOURNAL
    OFFICIAL
                   Transmitting data for publication in the Official         Transmitting data for publication in the Official
                                  Journal of RoS                                        Journal of RoS (AA-5.1)



                                                                            Submission of the decision of the Court (AA-6.1)
      AJPES



                   Application for deletion of LLC from Business                   Filling up the PRS-1 form (AA-6.2)
                         Register of Slovenia (PRS) (IO-6)
                                                                                     Transmitting the form (AA-6.3)




Table 3: List of IO and AA codes for newly founded, changed and liquidated LLCs after
          introducing e-VEM (after 1 February 2008)


                        NEWLY FOUNDED LLC - IO                                    Administrative activity (AA)
       BANK




                Opening an e-CA (electronic current account)               Opening a temporary bank account (AA-1.1)
                                  (IO-1)

                                                                       Filling up necessary forms and requests at the e-VEM
                  Filling up necessary requests at an e-VEM
                                                                                        entry point (AA-2.1)
                               entry point (IO-2)


                                                                                   Stamp elaboration (AA-3.1)
                           Stamp elaboration (OI-3)



                 Application for opening a permanent current
       BANK




                                                                               Conclusion of the contract (AA-4.1)
                                   account
                                    (IO-4)




                           CHANGES of LLC - IO                                    Administrative activity (AA)




                  Filling up requests for change at an e-VEM            Filling up necessary forms at the e-VEM entry point
                                entry point (IO-1)                                            (AA-1.1)




                          LIQUIDATION of LLC - IO                                 Administrative activity (AA)


                                                                              Elaboration of the notarial act (AA-1.1)
       NOTARY




                       Obtaining the notarial act (IO-1)
                                                                        Elaboration of the decision on liquidation (AA-1.2)



                Filling up necessary requests for deletion at an       Filling up necessary forms and requests at the e-VEM
                            e-VEM entry point (IO-2)                                    entry point (AA-2.1)




                                                                                                                              16
Table 4: Costs connected with registration, changing and liquidation simple LCCs

              REGISTRATION LCC
   Notary of the memorandum of association
                                                                 179,45 €
        Manager signatur authentication
                                                                  16,52 €
 Comfirmation of the register of desiction of the
                   company                                        27,54 €

 Elaboration of a proposal for entry in the Court
                     register
                                                                  44,06 €
 Publication in the LCC in the Official Journal of
              Republic of Slovenica                            0,0348 €/znak

               Stamp elaboration
                                                                  20,86 €
                CHANGING LCC
      Decision for a changing LCC - simple
                                                                   22 €
    Decision for a changing LCC - pretentious
                                                                   69 €
 Make fair copy in notary of the memorandum of
                   association                                    49,95 €

              LIQUIDATION LCC
         Decision for a liquidation LCC
                                                                   69 €
                   Generally
                   Hourly rate
                                                                   8,09 €
              (Electronic) Form M-1
                                                                   0,64 €
                    Form M-1
                                                                   0,41 €
              (Electronic) Form M-2
                                                                   0,5 €
                    Form M-2
                                                                   0,43 €
              (Electronic) Form M-3
                                                                   0,37 e
                    Form M-3
                                                                   0,34 €
                    Form PD-1
                                                                   0,5 e
           Photocopy A4 format/side
                                                                   0,05 €
                 Standard letter
                                                                   0,20 €




                                                                                   17
Step 2.2. Defining data sources

Data sources were defined by choosing a sample of enterprises according to the number of associates
(one-man or collective). Data was acquired by means of telephone interviews; 13 one-man and 6
collective simple limited liability companies took part in the survey.


Total number of enterprises contacted was 23, but four choose not to disclose requested data. It
should be noted, that some companies refused to reply to the questions asked. Average values for
respective groups are presented in the table (see Step 3.1).

Step 2.3. Testing representativeness of the population included in the survey

In calculations different legislative demands for singular limited liability companies were taken into
consideration. Fulfilling certain information obligations (IO) is obligatory for simple LLCs with more
than one associate, whereas other IOs can be obligatory only for one-man LLCs. But it must be
stressed that majority of IOs must be fulfilled by both types of LLC, regardless of number of
associates. Segmentation according to the number of associates was performed when calculating
newly founded simple LLCs and changes of singular LLCs, but only in case of change of head office,
name of enterprise, economic activity or representatives of the LLCs.


We estimate that of all LLCs founded in one year 80% of them are simple LLCs; similarly 60% of all
changes of LLCs are changes of simple LLCs. (Source: telephone interviews).


We set “standard" values of cost parameters for singular administrative activity; values were obtained
by calculating the arithmetic mean using parameters of all enterprises surveyed.


2.3 Calculation and estimation of administrative costs and administrative burdens

                                                                    8
3.1. Procedure of estimating administrative costs and administrative burdens
                        9
Hourly fee = 8,09 €


1. Cost parameters for calculation of administrative costs and burdens before the
establishment of e-VEM information system (before 1 February 2008)


Administrative costs = price * quantity


Administrative burden = administrative costs * correcting factor




8
    Calculations are done with all decimal places, whereas the table displays values rounded to 2 decimal places.
9
    The sum is specified as an hourly fee of an average gross salary in Republic of Slovenia in 2006.
                                                                                                                    18
        LEGISLATION




                                                                                            CONSULTANT




                                                                                                                               POPULATION
                                                                                                                 FREQUENCY
                                                                                             EXTERNAL




                                                                                                                                              QUANTITY




                                                                                                                                                              AS COSTS
                                                                                   COSTS
                                                                          TIME




                                                                                                         PRICE




                                                                                                                                                                              C.F.
                                                                AA
                                                       IO




                                                                                           REGISTRATION LCCs
                                                              AA-1.1    0,25 h                        2,02 €     1           3.960          3.960         7.999,20 €          0,1
                                                      IO-1    AA-1.2    0,17 h                        1,38 €     1           3.960          3.960         5.464,80 €          0,1
                                                              AA-1.3    0,33 h   0,25 €               2,92 €     1           3.960          3.960         11.563,20 €         0,1
       ERA-1, CRA-OCV2, CFA-OCV1, BRSA-1, TAA1-OCV2




                                                              AA-2.1    0,03 h                        0,24 €     1           1.222          1.222           293,28            1,0
                                                      IO-2
                                                              AA-2.2     1h                179,45 €  187,54 €    1           1.222          1.222        229.173,88 €         1,0
                                                      IO-3    AA-3.1    0,17 h             16,52 €   17,90 €     1           3.960          3.960          70.884,00          1,0
                                                      IO-4    AA-4.1    0,25 h             27,54 €   29,56 €     1           2.738          2.738         80.935,28 €         1,0
                                                      IO-5    AA-5.1     1h                44,06 €   52,15 €     1           3.960          3.960        206.514,00 €         1,0
                                                              AA-6.1    0,08 h                        0,65 €     1           3.960          3.960         2.574,00 €          1,0
                                                              AA-6.2    0,75 h                        6,07 €     1           3.960          3.960         24.037,20 €         1,0
                                                      IO-6
                                                              AA-6.3     1h                           8,09 €     1           3.960          3.960         32.036,40 €         1,0
                                                              AA-6.4    0,08 h                        0,65 €     1           3.960          3.960         2.574,00 €          1,0
                                                              AA-7.1     2h                          16,18 €     1           3.960          3.960         64.072,80 €         1,0
                                                      IO-7
                                                              AA-7.2    0,08 h                        0,65 €     1           3.960          3.960         2.574,00 €          1,0
                                                      IO-8    AA-8.1                       194,88 €  194,88 €    1           3.960          3.960        771.724,80 €         1,0
                                                      IO-9    AA-9.1     0,5 h             20,86 €   24,91 €     1           3.960          3.960         98.643,60 €         0,1
                                                              AA-10.1   0,25 h                        2,02 €     1           3.960          3.960         7.999,20 €          1,0
                                                      IO-10   AA-10.2   0,08 h                        0,65 €     1           3.960          3.960         2.574,00 €          1,0
                                                              AA-10.3   0,17 h   0,254 €              1,63 €     1           3.960          3.960         6.454,80 €          1,0
                                                      IO-11   AA-11.1     1h                          8,09 €     1           3.960          3.960         32.036,40 €         0,1
                                                              AA-12.1    0,9 h                        7,28 €     1           3.960          3.960         28.828,80 €         1,0
                                                      IO-12
                                                              AA-12.2   0,17 h   0,254 €              1,63 €     1           3.960          3.960         6.454,80 €          1,0
                                                              AA-13.1    0,9 h    0,5 €               7,78 €     1           3.960          3.960         30.808,80 €         1,0
                                                      IO-13
                                                              AA-13.2   0,08 h                        0,65 €     1           3.960          3.960         2.574,00 €          1,0
                                                      IO-14   AA-14.1     1h     0,41 €               8,50 €     1           3.960          3.960         33.660,00 €         1,0
                                                                                             CHANGING LCCs
                                                      IO-1    AA-1.1    0,75 h   0,256 €              6,32 €     1           10.566         10.566       66.777,12 €          0,1
CFA-OCV1, BRSA1,
ERA-1, CRA-OCV2,




                                                      IO-2    AA-2.1     1,5 h              45,5 €   57,64 €     1           4.800          4.800        276.672,00 €         1,0
                                                                                           49,95 €   51,97 €                                             549.115,02 €
   TAA-OCV2




                                                      IO-3    AA-3.1    0,25 h                                   1           10.566         10.566                            1,0
                                                      IO-4    AA-4.1     1,5 h                       12,14 €     1           10.566         10.566       128.271,24 €         1,0
                                                      IO-5    AA-5.1                       31,32 €   31,32 €     1           10.566         10.566       330.927,12 €         1,0
                                                              AA-6.1    0,25 h                        2,02 €     1           10.566         10.566       21.343,32 €          1,0
                                                      IO-6    AA-6.2    0,08 h                        0,65 €     1           10.566         10.566        6.867,90 €          1,0
                                                              AA-6.3    0,17 h   0,254 €              1,63 €     1           10.566         10.566       17.222,58 €          1,0
                                                                                            LIQUIDATION LCCs
                                                              AA-1.1.    0,9 h   0,43 €               7,71 €     1           1.936          1.936        14.926,56 €          1,0
                                                      IO-1
ERA-1, CRA-OCV2, CFA-




                                                              AA-1.2    0,08 h                        0,65 €     1           1.936          1.936         1.258,40 €          1,0
  OCV1, BRSA1, TAA-




                                                              AA-2.1    0,08 h               69 €     0,65 €     1           1.936          1.936         1.258,40 €          1,0
                                                      IO-2
                                                              AA-2.2     1,5 h                       81,14 €     1           1.936          1.936        157.087,04 €         1,0
                                                              AA-3.1     0,5 h                        4,05 €     1           1.936          1.936         7.840,80 €          1,0
        OCV2




                                                      IO-3
                                                              AA-3.2    0,08 h   0,254 €               0,9 €     1           1.936          1.936         1.742,4 €           1,0
                                                      IO-4    AA-4.1      1h                          8,09 €     1           1.936          1.936        15.662,24 €          1,0
                                                      IO-5    AA-5.1                       20,88 €   20,88 €     1           1.936          1.936        40.423,68 €          1,0
                                                              AA-6.1    0,25 h                        2,02 €     1           1.936          1.936         3.910,72 €          1,0
                                                      IO-6    AA-6.2    0,08 h                        0,65 €     1           1.936          1.936         1.258,40 €          1,0
                                                              AA-6.3    0,17 h   0,254 €              1,63 €     1           1.936          1.936         3.155,68 €          1,0




                                                                                                                                                                         19
                                                            2. Cost parameters for calculation of administrative costs and burdens after the establishment
                                                            of e-VEM information system (after 1 February 2008)




                                                                                                                                                                                 ADMIN. COSTSI
 LEGISLATION




                                                                                                           CONSULTANT




                                                                                                                                              POPULATION
                                                                                                                                FREQUENCY
                                                                                                            EXTERNAL




                                                                                                                                                                 QUANTITY
                                                                                                COSTS




                                                                                                                        PRICE
                                                                                     TIME
                                                                      AA
                                                            IO




                                                                                               REGISTRATION LCCs to e-VEM
                                                 IO-1              AA-1.1       0,25 h                          2,02 €     1                3.960               3.960       7.999,20 €
Region.




                                                                                                               16,18 €                                                      64.072,80 €
 legis.




                                                 IO-2              AA-2.1         2h                                       1                3.960               3.960
                                                 IO-3              AA-3.1        0,5 h                20,86 €  24,91 €     1                3.960               3.960       98.643,60 €
                                                 IO-4              AA-4.1         1h                            8,09 €     1                3.960               3.960       32.036,40 €
                                                                                                 CHANGING LCCs to e-VEM
                                                 IO-1              AA-1.1       1,5 h                          12,14 €     1                10.566             10.566       128.271,24 €
                                                                                            LIQUIDATION LCCs to e-VEM (notaries)
                                                                   AA-1.1       0,08 h                          0,65 €     1                1.936               1.936        1.258,40 €
Reg...




                                                 IO-1
 leg.




                                                                   AA-1.2       0,75 h                 69 €    75,07 €     1                1.936               1.936       146.555,20 €
                                                 IO-2              AA-2.1         1h                            8,09 €     1                1.936               1.936       15.662,24 €


                                                            3. Calculation of administrative costs before the establishment of e-VEM (before 1 February
                                                            2008)

                                                                                                                      Total admin.                         Total admin. burden
                                                                               IO                       Population
                                                                                                                          costs                              (AC*cor. factor)
                                                                                                         REGISTRATION LCCs
                                                                                                          3.960        7.999,20 €                               799,92 €
                                                                              IO-1                        3.960        5.464,80 €                               546,48 €
                                                                                                          3.960        11.563,20 €                             1.156,32 €
                                                                       TOTAL IO -1                                     25.027,20 €                             2.502,72 €
                                                                                                          1.222          293,28 €                               293,28 €
               ERA-1, CRA-OCV2, CFA-OCV1, BRSA1, TAA-OCV2




                                                                              IO-2
                                                                                                          1.222        229.173,88                              229.173,88
                                                                           TOTAL IO-2                                 229.467,16 €                            229.467,16 €
                                                                              IO-3                        3.960         70.884,00                              70.884,00
                                                                           TOTAL IO-3                                   70.884,00                              70.884,00
                                                                              IO-4                        2.738        80.935,28 €                            80.935,28 €
                                                                           TOTAL IO-4                                  80.935,28 €                            80.935,28 €
                                                                              IO-5                        3.960       206.514,00 €                            206.514,00 €
                                                                           TOTAL IO-5                                 206.514,00 €                            206.514,00 €
                                                                                                          3.960        2.574,00 €                              2.574,00 €
                                                                                                          3.960        24.037,20 €                            24.037,20 €
                                                                              IO-6
                                                                                                          3.960        32.036,40 €                            32.036,40 €
                                                                                                          3.960        2.574,00 €                              2.574,00 €
                                                                           TOTAL IO-6                                  61.221,60 €                            61.221,60 €
                                                                                                          3.960        64.072,80 €                            64.072,80 €
                                                                              IO-7
                                                                                                          3.960        2.574,00 €                              2.574,00 €
                                                                           TOTAL IO-7                                  66.646,80 €                            66.646,80 €
                                                                              IO-8                        3.960       771.724,80 €                            771.724,80 €
                                                                           TOTAL IO-8                                 771.724,80 €                            771.724,80 €
                                                                              IO-9                        3.960        98.643,60 €                             9.864,36 €
                                                                           TOTAL IO-9                                  98.643,60 €                             9.864,36 €
                                                                                                          3.960        7.999,20 €                              7.999,20 €
                                                                             IO-10                        3.960        2.574,00 €                              2.574,00 €
                                                                                                          3.960        6.454,80 €                              6.454,80 €
                                                                       TOTAL IO-10                                     17.028,00 €                            17.028,00 €
                                                                          IO-11                           3.960        32.036,40 €                             3.203,64 €
                                                                       TOTAL IO-11                                      32.036,40                              3.203,64 €
                                                                                                                                                                               20
                          3.960         28.828,80 €      28.828,80 €
       IO-12
                          3.960          6.454,80        6.454,80 €
    TOTAL IO-12                         35.283,60 €      35.283,60 €
                          3.960         30.808,80 €      30.808,80 €
       IO-13
                          3.960         2.574,00 €       2.574,00 €
    TOTAL IO-13                         33.382,80 €      33.382,80 €
       IO-14              3.960         33.660,00 €      33.660,00 €
    TOTAL IO-14                         33.660,00 €      33.660,00 €
      TOTAL
                                      1.762.455,24 €   1.622.321,72 €
REGISTRATION LCCs
                            CHANGING LCCs
       IO-1               10.566        66.777,12 €       6.677,77 €
    TOTAL IO-1                          66.777,12 €       6.677,77 €
       IO-2               4.800        276.672,00 €      276.672,00 €
    TOTAL IO-2                         276.672,00 €      276.672,00 €
       IO-3               10.566       549.115,02 €      549.115,02 €
    TOTAL IO-3                         549.115,02 €      549.115,02 €
       IO-4               10.566       128.271,24 €      128.271,24 €
    TOTAL IO-4                         128.271,24 €      128.271,24 €
       IO-5               10.566       330.927,12 €      330.927,12 €
    TOTAL IO-5                         330.927,12 €      330.927,12 €
       IO-6               10.566        21.343,32 €      21.343,32 €
                          10.566        6.867,90 €        6.867,90 €
                          10.566        17.222,58 €      17.222,58 €
    TOTAL IO-6                          45.433,80 €      45.433,80 €
 TOTAL CHANGING
                                      1.397.196,30 €   1.337.086,89 €.
      LCCs
                          LIQUIDATION LCCs
                          1.936        14.926,56 €       14.926,56 €
       IO-1
                          1.936         1.258,40 €       1.258,40 €
    TOTAL IO-1                           16.184,96 €     16.184,96 €
                          1.936          1.258,40 €       1.258,40 €
       IO-2
                          1.936         157.087,04 €     157.087,04 €
    TOTAL IO-2                          158.345,44 €     158.345,44 €
                          1.936          7.840,80 €       7.840,08 €
       IO-3
                          1.936          1.742,40 €       1.742,40 €
    TOTAL IO-3                            9.583,2 €        9.583,2 €
       IO-4               1.936          15.662,24 €     15.662,24 €
    TOTAL IO-4            1.936          15.662,24 €     15.662,24 €
       IO-5               1.936          40.423,68 €     40.423,68 €
    TOTAL IO-5                           40.423,68 €     40.423,68 €
                          1.936          3.910,72 €       3.910,72 €
       IO-6               1.936          1.258,40 €       1.258,40 €
                          1.936          3.155,68 €       3.155,68 €
    TOTALIO-6                             8.324,8 €        8.324,8 €
TOTAL LIQUIDATION
                                       248.524,32 €     248.524,32 €
      LCCs
  TOTALcosts regulation               3.408.176,04 €   3.207.932,93 €




                                                                        21
  4. Calculation of administrative costs after the establishment of e-VEM (after 1 February 2008)
                                                             Total admin.        Total admin. burden
                      IO                   Population
                                                                 costs             (AC*cor. factor)
                                       REGISTRATION LCCs to e-VEM
                     IO-1                     3.960           7.999,20 €              7.999,20 €
                TOTAL IO -1                                   7.999,20 €              7.999,20 €
ERA-1, CRA-OCV2, CFA-OCV1, BRSA1, TAA-OCV2




                     IO-2                     3.960           64.072,80 €            64.072,80 €
                 TOTAL IO-2                                   64.072,80 €            64.072,80 €
                     IO-3                     3.960           98.643,60 €             9.864,60 €
                 TOTAL IO-3                                   98.643,60 €             9.864,36 €
                     IO-4                     3.960           32.036,40 €             3.203,64 €
                 TOTAL IO-4                                   32.036,40 €             3.203,64 €
                                                   TOTAL
                                                                                     202.752,00 €          85.140,00 €
                                             REGISTRATION LCCs
                                                                     CHANGING LCCs to e-VEM
                                                    IO-1               10.566       128.271,24 €           128.271,24 €
                                                 TOTAL IO-1                         128.271,24 €           128.271,24 €
                                              TOTAL CHANGING
                                                                                     128.271,24 €          128.271,24 €
                                                   LCCs
                                                                                                      10
                                                               LIQUIDATION LCCs to e-VEM (notaries)
                                                                        1.936          1.258,40 €           1.258,40 €
                                                    IO-1
                                                                        1.936         146.555,20 €         146.555,20 €
                                                 TOTAL IO-1                           147.813,60 €         147.813,60 €
                                                    IO-2                1.936         15.662,24 €           15.662,24 €
                                                 TOTAL IO-2                           15.662,24 €           15.662,24 €
                                             TOTAL LIQUIDATION
                                                                                     163.475,48 €          163.475,48 €
                                                   LCCs
                                                  TOTALcosts regulation              494.499,08 €          376.886,72 €


  Administrative Savings total = AC before introducing e-VEM – AS after introducing e-VEM =
                                                              = 3.408.176,04 € - 494.499,08 € = 2.913.676,96 €


  Administrative Savings of founding a LLC = AC before introducing e-VEM – AS after introducing e-VEM =
                                                              = 1.762.455,24 € - 202.752,00 € = 1.559.703,24 €



  Administrative Savings of changing a LLC = AC before introducing e-VEM – AS after introducing e-VEM =
                                                              = 1.397.196,30 € - 128.271,24 € = 1.268.925,06 €


  Administrative Savings of liquidating a LLC = AC before introducing e-VEM – AS after introducing e-VEM =
                                                               = 248.524,32 € - 163.475,48 € = 85.048,84 €




  10
     Postopek izbrisa podjetja je možen le preko notarskih e-VEM vstopnih točk, pri čemer je obvezno, da notar izdela notarski
  zapisnik in sklep o izbrisu d.o.o..
                                                                                                                          22
In calculating administrative burdens answers of the surveyed companies were taken into
consideration; the correction factor was considered in the calculation as well.



Administrative burden = administrative cost of the regulation x correcting factor


Administrative Total savings = AB before introducing e-VEM – AB after introducing e-VEM =
                                      = 3.207.932,93 € - 376.886,72 € = 2.831.046,21 €


Administrative Total savings of founding a LLC = AB before introducing e-VEM – AB after introducing e-VEM =
                                      = 1.622.321,72 € – 85.140,00 € = 1.537.181,72 €


Administrative Total savings of changing a LLC = AB before introducing e-VEM – AB after introducing e-VEM =
                                      = 1.337.086,89 € – 128.271,24 € = 1.208.815,65 €


Administrative Total savings of liquidating a LLC = AB before introducing e-VEM – AB after introducing e-VEM =
                                      = 248.524,32 € – 163.475,48 € = 85.048,84 €

Explanation:
With the establishment of the e-VEM information system for c.c. (1 February 2008) and with the
implementation of new provisions of the Court Register Act and the Commercial Companies Act
important administrative obstacles were eliminated. Savings can be expressed in time, which had
been shortened from 6 months to only 4 days as well as in money savings. It has been estimated that
before the establishment of the e-VEM information system and before the changes to the legislation
(ZGD-1, ZSreg-UPB2, ZPRS-1, ZDS-1-UBB2 etc.) legislative acts of Republic of Slovenia regulating
administrative activity in areas of founding, changing and liquidating simple LLCs have been causing
3,4 mil EUR of administrative costs and 3,2 mil EUR of administrative burdens per year . It has also
been estimated that administrative cost after the establishment of the e-VEM system (after 1 February
2008) will be reduced for approximately 2,91 mil EUR per year, whereas administrative burdens will
be reduced for 2,83 mil EUR. Total administrative costs will now amount to 0,49 mil EUR and
administrative burdens to 0,37 mil EUR.
It should be stressed that real savings will probably be considerably higher. Due to the simplicity, on-
line access and lower cost of future changes and liquidations of LLCs (average number of monthly
registrations of sole proprietorships (SP) in 2005 was 33% higher than the number of monthly
                                                                                             11
registrations of SPs in the year before the introduction of the e-VEM system for SPs – see
Supplement 2) an upward trend in number of new registrations of simple LLCs is expected after the


11
  In July 2005 the e-VEM portal was established for sole proprietorships. Interested persons could, on one place (over 223
entry points), over the internet or with help of a clerk use the VEM system to:
         Register a sole proprietorship in the business register
         Register a ST in the Tax register
         Register prepayment of tax on income achieved by pursuing the registered activity
         Register an outlay of predicted social security contributions
         Register data on pension, disability and health insurance, parental protection insurance, unemployment insurance and
          data on conclusion of employment contract,
         Register data on sole trader’s children under 18 years of age for health insurance
         Submit an application for obtaining a business licence
         Register change of data of sole proprietorship in the Business register of Slovenia,
         Deletion of sole proprietorship from the Business register of Slovenia and identification of sole proprietorship for
          purposes of VAT


                                                                                                                          23
establishment of the e-VEM information system.With a view to the consideration mentioned above the
total savings from administrative costs would amount to 3,87 mil EUR per year and up to 3,76 mil
EUR per year from administrative burdens.
Prior to the establishment of e-VEM procedures have generated respectively 1,76 mil EUR and 1,64
mil EUR yearly of administrative costs and burdens for the newly founded commercial enterprises,
which translates to 396,24 EUR of administrative costs per one-man LLC (360,85 mil EUR of
administrative burdens) and 554,46 mil EUR of administrative costs per a collective LLC (519,07 EUR
of administrative burdens). With the introduction of e-VEM costs have gone down for 1,56 mil EUR,
burdens for 1,53 mil EUR; administrative costs now amount to only 51,20 EUR per economic entity
(21,50 EUR of administrative burdens per economic entity).


The establishment of the e-VEM has lowered administrative costs of founding a singular simple one-
man LLC by almost 8 times, whereas the costs of founding collective LLCs have been reduced by
almost 11 times. Administrative burdens in procedures for founding one-man LLCs have been
reduced by almost 17 times and by as much as 24 times for collective LLCs.


Prior to the establishment of e-VEM changes of commercial enterprises (name, head office, activity,
representative) have generated respectively 1,39 mil EUR and 1,33 mil EUR yearly of administrative
costs and burdens, which translates to 106,05 EUR of administrative costs per one-man LLC (100,36
mil EUR of administrative burdens) and 163,69 EUR of administrative costs per a collective LLC
(158,00 EUR of administrative burdens). With the introduction of e-VEM costs have gone down for
1,27 mil EUR, burdens for 1,21 mil EUR and now amount to only 12,14 EUR per economic entity
(administrative burdens are equivalent to administrative costs).


The establishment of the e-VEM has lowered administrative costs of changing a singular simple one-
man LLC by almost 9 times, whereas the costs of changing collective LLCs have been reduced by
almost 14 times. Administrative burdens in procedures for founding a new one-man LLC are now
almost 8 times lower and as much as 13 times lower for collective LLCs.


Prior to the establishment of e-VEM procedures for liquidation of commercial entities have generated
0,25 mil EUR of administrative costs and burdens per year, which translates to 128,37 EUR per LLC.
After the introduction of e-VEM costs and burdens have been reduced by 85 048,84 EUR and now
amount to 84,43 EUR per a collective LLC (administrative burdens are equivalent to administrative
costs).


The introduction of e-VEM has lowered administrative costs and burdens for liquidation of a singular
LLC for 1,5 times.




                                                                                                 24
      3.0 CALCULATION OF SAVINGS AFTER THE ESTABLISHMENT OF e-VEM
      SYSTEM AS A RESULT OF SIMPLIFIED PROCEDURES OF COMPLETING AND
      TRASMITTING FORMS DEMANDED BY THE ZZZS AND ZRSZ
      In deliberating all changes one has to take into consideration also the possibility of completing and
      transmitting forms demanded by the ZZZS (M-1 form) and the possibility of changing data on
      compulsory social security on open insurance records. (M-3), deregistration of persons from the
      compulsory social security programs (M-2), registration, changes and deregistration of family
      members in heath insurance (M-DČ), registration and deregistration of foreign citizens in compulsory
      insurance programs and ZRSZ, registering a vacant work place (PD-1 form) over the internet (by using
      a qualified digital certificate) or on one of the 180 e-VEM entry points and 90 notaries (both options are
      free of charge).

      3.1 CALCULAION OF SAVINGS FOR LIMITED LIABILITY COMPANIES
      1. Calculation of administrative costs before the establishment of e-VEM (before 1 February
      2008):

                                                          Expe                  Freq
                                                                                       Populat
         ZZZS - IO                    AA         Time     nditu   ZI   Price    uenc
                                                                                         ion
                                                                                                   Q           Costs
                                                           res                    y
   Registration of persons in
   compulsory social security
         programs (M1)
   Registration of changes of      Obtaining
   compulsory social security      and filling
  data on open insurance files    up the form
                                                 0,5 h    0,4 €        4,44 €    1     566.172   566.172   2.513308,68 €
              (M-3)                (M1, M2,
 Deregistration of persons from   M3, M-DČ)
   compulsory social security
              (M2)
Registration of family members
in compulsory health insurance
             (M-DČ)
    Change of data on family
       members (M-DČ)                            0.17 h                1,38 €    1     566.172   566.172   781.317,36 €
     Deregistration of family     Transmittin
   members from compulsory        g the form
    health insurance (M-DČ)
     Total IOs - ZZZS                                                                                      3.295.121,04 €

         ZRSZ - IO

                                   Obtaining
                                   and filling
                                  up the form
                                                 0,5 h    0,5 €        4,54 €    1     63.417    63.417    287.913,18 €
  Registering a vacant work
 place or type of work (PD-1)
                                  Transmittin
                                  g the form     0,17 €                1,38 €    1     63.417    63.417     87.515,00 €

      Total IO - ZRSZ                                                                                      375.428,18 €

   Total ZZZS and                                                                                          3.670.549,22 €
        ZRSZ




                                                                                                              25
       2. Calculation of administrative costs after establishing e-VEM (after 1 February 2008) - on the
       assumption that all procedures are done electronically or through an e-VEM entry point:

                                                                 Expendi                 Frequ     Populat    Quantit
          ZZZS - IO                         AA          Time
                                                                  tures
                                                                           EC   Price
                                                                                         ency        ion        y
                                                                                                                            Costs
On-line registration of persons in
compulsory social security
programs (M-1)
On-line registration of changes of
compulsory social security data on
open insurance files (M-3)
On-line deregistration of persons in      On-line
compulsory social security              completion
programs (M-2)                         of forms (M-     0,25 h                  2,02 €        1     566.172   566.172   1.143.667,44 €
On-line registration of family         1, M-2, M-3,
members in compulsory health              M-DC)
insurance (M-DČ)
On-line changing of data on family
members (M-DČ)
On-line deregistration of family
members from compulsory health
insurance (M-DČ)

          ZRSZ - IO

                                        Completing
Registering a vacant work
place or type of work (PD-1)
                                          the PD-1      0,25 h                  2,02 €        1     63.417     63.417    128.102,34 €
                                        form on-line

   Total ZZZS and                                                                                                       1.271.769,78 €
        ZRSZ

       3. Calculation of administrative costs after establishing e-VEM (after 1 February 2008) - on the
       assumption that 80% of procedures are done electronically or through an e-VEM entry point;
       other activities as before the establishment of e-VEM:

                                                                                         Fre
                                                                 Expen                            Populatio   Quantit
          ZZZS - IO                        AA           Time
                                                                 ditures
                                                                           EC   Price    que
                                                                                                     n          y
                                                                                                                            Costs
                                                                                         ncy
Registration of persons in                On-line
compulsory social security              completion
programs (M-1)
Registering changes of
                                       of forms (M-     0.25 h                  2,02 €    1        452.938    480.000   914.934,76 €
compulsory social security data on
                                       1, M-2, M-3,
open insurance files (M-2)                M-DC)
Deregistration of persons from           Obtaining
compulsory social security             and filling up
programs (M-2)                           the form       0,5 h     0,4 €         4,44 €    1        113.234    113.234   502.758,96 €
Registration of family members in        (M1, M2,
compulsory health insurance (M-
                                        M3, M-DČ)
DČ)
Change of data on family
members (M-DČ)                         Transmitting
Deregistration of family members         the form
                                                        0,17 h                  1,38 €    1        113.234    113.234   156.262,92 €
from compulsory health insurance
(M-DČ)
          Total ZZZS                                                                                                    1.573.956,64 €

          ZRSZ - IO
Registering a vacant work              Filling up the
place or type of work (PD-1)            PD-1 form       0,25 h                  2,02 €    1        50.734     50.734    102.482,68 €
on-line                                    on-line
                                        Obtaining
Registering a vacant work
place or type of work (PD-1)
                                       and filling up   0,5 h     0,5 €         4,54 €    1        12.683     12.683     57.580,82 €
                                          the form
                                       Transmitting
                                          the form
                                                        0.17 h                  1,38 €    1        12.683     12.683     17.502,54 €

          Total ZRSZ                                                                                                    177.566,04 €

   Total ZZZS and                                                                                                       1.751.522,68 €
        ZRSZ



                                                                                                                           26
Due to simplified procedures of completion and transmission of documents demanded by ZZZS and
ZRSZ the correction factor was disregarded in the calculations, as none of the surveyed enterprises
would continue with the aforementioned administrative activities, meaning that administrative burdens
equal administrative costs.

Administrative LLC savings 100% = AC before introducing e-VEM – AS after introducing e-VEM =
                                = 3.670.549,22 € - 1.271.769,78 € = 2.398.779,44 €


Administrative LLC savings 80% = AC before introducing e-VEM – AS after introducing e-VEM =
                               = 3.670.549,22 € - 1.751.522,68 € = 1.919.026,54 €

Explanation:

Before the establishment of e-VEM information system (1 February 2008) administrative costs of
completion and transmission of forms/requests demanded by the ZZZS and ZRSZ amounted to 3,87
mil EUR yearly. Savings generated by the introduction of the e-VEM information system (1 February
2008) and consequently from simplified procedures of completion and transmission of forms/request
demanded by the ZZZS and ZRSZ (over the internet or on one of the VEM entry points) amount to 2.4
mil EUR per year (assuming that all forms and requests have been competed and transmitted over
the internet or at a VEM entry point) or 1,92 mil EUR per year (assuming that 80% of all forms and
requests are completed and transmitted over the internet or at a VEM entry point and other documents
in the manner usual before the establishment of the e-VEM information system).




                                                                                                   27
         3.2 CALCULATION OF SAVINGS FOR ALL COMMERCIAL ENTITIES
         1. Calculation of administrative costs before the establishment of e-VEM (before 1 February
             2008):

            ZZZS - IO                           AA        Time        C       EC    Price    Freq.           Pop.          Q             Costs

     Registration of persons in             Obtaining
    compulsory social security              and filling
           programs (M1)                   up the form
    Registration of changes of              (M1, M2,
compulsory social security data on         M3, M-DČ
                                                           0,5 h   0,4€             4,44 €       1         1.415.429    1.415.429    6.284.504,76 €
    open insurance files (M-3)
   Deregistration of persons from
  compulsory social security (M2)
 Registration of family members in
  compulsory health insurance (M-
                DČ)
     Change of data on family
         members (M-DČ)
Deregistration of family members
                                           Transmittin    0,17h                     1,38 €       1         1.415.429    1.415.429    1.953.292,02 €
                                           g the form
from compulsory health insurance
(M-DČ)

         Total IO - ZZZS                                                                                                             8.237.796,78 €

            ZRSZ - IO
                                            Obtaining
                                            and filling
                                           up the form
                                                           0,5 h   0,5€             4,54 €       1         158.543       158.543     719.785,22 €
Registering a vacant work place or
       type of work (PD-1)
                                           Transmittin
                                           g the form     0,17€                     1,38 €       1         158.543       158.543     218.789,34 €

         Total IO ZRSZ                                                                                                               938.574,56 €
  Total ZZZS in ZRSZ                                                                                                                 9.176.371,34 €



         2. Calculation of administrative costs after establishing e-VEM (after 1 February 2008) - on the
         assumption that all procedures are done electronically or through a VEM entry point:

               ZZZS - IO                             AA        Time       C        EC   Price        Fr.      Pop.           Q            Costs
On-line registration of persons in compulsory
social security programs (M-1)
On-line registration of changes of compulsory
social security data on open insurance files
(M-3)                                              On-line
On-line deregistration of persons in            completion
compulsory social security programs (M-2)       of forms (M-                            2,02 €       1      1.415.429    1.415.429    2.859.166,58 €
On-line registration of family members in       1, M-2, M-3,
compulsory health insurance (M-DČ)                 M-DC)
On-line changing of data on family members
(M-DČ)
On-line deregistration of family members from
compulsory health insurance (M-DČ)

               ZRSZ - IO

                                                Completing
Registering a vacant work place or type
of work (PD-1)
                                                  the PD-1                              2,02 €       1       158.543      158.543      320.256,86 €
                                                form on-line

    Total ZZZS in ZRSZ                                                                                                                3.179.423,44 €




                                                                                                                                       28
         3. Calculation of administrative costs after establishing e-VEM (after 1 February 2008) - on the
         assumption that 80% of procedures are done electronically or at a VEM entry point; other
         activities as before the establishment of e-VEM:

                                                                                             Populati
          ZZZS - IO                      AA            Time     Costs   EC   Price    Freq
                                                                                               on
                                                                                                            Q            Costs
Registration of persons in              On-line
compulsory social security            completion
programs (M-1)
Registering changes of
                                     of forms (M-      0,25 h                2,02 €    1     1.132.343   1.132.343   2.287.332,86 €
compulsory social security data on
                                     1, M-2, M-3,
open insurance files (M-2)              M-DC)
Deregistration of persons from         Obtaining
compulsory social security           and filling up
programs (M-2)                         the form         0,5 h   0,4 €        4,44 €    1     283.086     283.086     1.256.901,84 €
Registration of family members in      (M1, M2,
compulsory health insurance (M-
                                      M3, M-DČ)
DČ)
Change of data on family
members (M-DČ)                       Transmitting
Deregistration of family members       the form
                                                       0,17 h                1,38 €    1     283.086     283.086     390.658,68 €
from compulsory health insurance
(M-DČ)
         Total ZZZS                                                                                                  3.934.893,38 €

          ZRSZ -IO
Registering a vacant work            Filling up the
place or type of work (PD-1)          PD-1 form        0,25 h                2,02 €    1     126.834     126.834     256.204,68 €
on-line                                  on-line
                                      Obtaining
Registering a vacant work
place or type of work (PD-1)
                                     and filling up     0,5 h   0,5 €        4,54 €    1      31.709      31.709     143.958,86 €
                                        the form
                                     Transmitting
                                        the form
                                                       0,17 h                1,38 €    1      31.701      31.709      43.747,38 €

         Total ZRSZ                                                                                                  443.910,92 €

     Total ZZZS in                                                                                                   4.378.804,30 €
         ZRSZ


         Administrative savings 100% = AC before introducing e-VEM – AS after introducing e-VEM =
                                                      = 9.176.371,34 € - 3.179.423,44 € = 5.996.947,90 €


         Administrative savings 80% = AC before introducing e-VEM – AS after introducing e-VEM =
                                                      = 9.176.371,34 € - 4.378.804,30 € = 4.797.567 €


         Explanation:

         Prior to the establishment of e-VEM information system (1 February 2008) administrative costs of
         completion and transmission of forms/requests demanded by the ZZZS and ZRSZ amounted to 9.67
         mil EUR yearly (for all commercial entities). Savings generated by the introduction of the e-VEM
         information system (1 February 2008) and consequently from simplified procedures of completion and
         transmission of forms/request demanded by the ZZZS and ZRSZ (over the internet or on one of the
         VEM entry points) amount to 6 mil EUR per year (assuming that all forms and requests have been
         competed and transmitted over the internet or at a VEM entry point) or 4,8 mil EUR per year
         (assuming that 80% of all forms and requests are completed and transmitted over the internet or at a
         VEM entry point and other documents in the manner usual before the establishment of the e-VEM
         information system).




                                                                                                                      29
4.0 CALCULATION OF SAVINGS RESULTING FROM THE FUSION OF THE
BUSINESS AND COURT REGISTERS INTO A PUBLIC REGISTER OPEN TO
PUBLIC INSPECTION.
By establishing the e-VEM information system and changing the legislation the business and court
registers have been technologically merged into a single register operated by the Agency of the
Republic of Slovenia for Public Legal Records and Related Services. In this way commercial
enterprises no longer need to obtain extracts from the Court register (confirmation on pursuit of
business or confirmation on company registration) as all data has been made available to public free
of charge on the AJPES web page.

Table 5: Number of commercial enterprises in 2007:
                         Commercial enterprises
                As at                                        Legal entity
             31.12.2006                                        49.537
             31.3.2007                                         50.314
             30.6.2007                                         51.017
             30.9.2007                                         52.036
Source: Number of business entities according to legal and organisational forms, situation as at 30 September 2007.

1. Calculation of administrative costs before the establishment of e-VEM (before 1 February
2008):

                                                                                Fre
                                                   Expen                                Populat                  Administrativ
       IO                 AA             Time
                                                   ditures
                                                                EC    Price     que
                                                                                          ion
                                                                                                        Q
                                                                                                                   e costs
                                                                                ncy
Extract from the     Obtaining an
Court Register or   extract from the
 other relevant     Court Register or    1.94 h     19,46€            35,15€      1      52.036      52.036      1.829.065,40 €
     record          other relevant
                         record

Total IO                                                                                                         1.829.065,40 €
Source: Estimation of administrative costs – changes in public procurement procedures, final draft ver1.2, 26 September 2007.

In calculations estimating savings generated by the fusion of business and court registries that
simultaneously abolished the obligation of acquiring extracts from the Court register the correction
factor was disregarded, as none of the surveyed enterprises would continue with the aforementioned
administrative activities, meaning that administrative burdens equal administrative costs.


Administrative Savings of a c.c. = AC before introducing e-VEM – AS after introducing e-VEM =
                                        = 1.829.056,40 € - 0 € = 1.829.065,40 €

Explanation:

Prior to the fusion of business and court registers administrative burdens (acquiring extracts from the
Court register) of commercial entities amounted to 1.83 mil EUR. By combining both registers and
establishing a Public register commercial entities have been freed of obligation to acquire extracts
from the Court register, as data has been made accessible to the public free of charge on the AJPES
web page; thanks to measures referred to above commercial entities save 1.83 mil EUR per year.




                                                                                                                           30
        ESTIMATION OF TOTAL SAVINGS GENERATED BY THE
      ESTABLISHMENT OF THE e-VEM INFORMATION SYSTEM AND
               CHANGES OF NATIONAL LEGISLATION
                                     Administrative          Administrative            Savings12
                                   burdens before the       burdens after the
Type of saving                     establishment of e-     establishment of e-
                                     VEM (before 1        VEM (after 1 February
                                     February 2008)               2008)
Foundation of a simple LLC           1.622.321,72 €            85.140,00 €           1.537.181,72 €
Change of a simple LLC               1.337.086,89 €           128.271,24 €           1.208.815,65 €
Liquidation of a LLC                  248.524,32 €            163.475,48 €             85.048,84 €
Simplified procedures in ZZZS
and ZRSZ (all business entities)     9.176.371,34 €            3.179.423,44 €        5.996.947,90 €
Establishment of public records
(all c.c.)                           1.829.056,40 €                0,00 €             1.829.065,40 €
Total                               14.213.369,67 €            3.556.310,16 €        10.657.059,51 €

Explanation:

With the introduction of the e-VEM information system and changes of the aforementioned national
legislation we can estimate that due to the simplified procedures for foundation, change or liquidation
of simple limited liability companies, simplification of registration, deregistration or change of data
relevant for social security programs and data of family members, simplified procedure of registering
vacant work place or types of work and the establishment of Public register commercial entities have
generated savings amounting to 10,66 mil EUR per year, thus lowering administrative burdens to
3,56 mil EUR – this represents a 74,97% decrease in costs compared to the situation before the
establishment of the e-VEM information system (before 1 February 2008).




12
     In case of full use of possibilities offered by the e-VEM information system.
                                                                                                    31
Supplement 1: Procedures for founding a c.c. in one place or over the internet
              (since 1 February 2008)

      Entry in Court and Business registers
       General proposal for registering a newly formed LLC
       Proposal for registering a simple one-man LLC
       Proposal for registering other entity in the Court register
       Proposal for registering a trade name
       General proposal for registration of change in the Court register
       Proposal for registering a simple change of a LLC
       Proposal for deletion from the Court register
       Proposal for ex officio registration of other entity in the Court register
       Proposal for ex officio registration of change in the Court register
       Proposal for ex officio deletion from the Court register

      REGISTER OF DECISIONS
       Application for opening a Register of decisions
       Entering of decisions into the reformed Register of decisions

      Declaration of tax data
       Entry in the Tax register for all types of commercial enterprises
       Application for issuing of a VAT identification number for all types of commercial enterprises
       Submission of tax calculation for all types of commercial enterprises
       Submission of notification of change of tax period for all types of commercial enterprises

      SUBMISSION OF DATA TO ZZZS (ZPIZ)
       Registration of persons liable for contribution
       Registration of persons in compulsory health insurance
       Deregistration of persons from compulsory health insurance
       Registration of changes of data on compulsory insurance
       Registration of foreign citizens in compulsory insurance
       Deregistration of foreign citizens from compulsory insurance
       Registration and deregistration of family members
       Registration of changes of family members data

      SUBMISSION OF DATA TO ZRSZ
       Registering a vacant work place

      SUBMISSION OF DATA TO GZS
       Application for membership in GZS

      SUBMISSION OF DATA TO GZS
       Acquisition of business licence

      OTHER PROCEDURES AND ELECTRONIC SERVICES AVAILABLE ON THE e-VEM
       PORTAL
       A) List of all obligatory procedures in initial relations between a commercial entity and the state
       B) List of all procedures where electronic communication has been made possible, together
       with links to e-services of state bodies
       C) Life events with descriptions of relevant administrative procedures and links to electronic
       services
       D) Access to all personally submitted electronic documents, from the foundation to liquidation
       of a commercial enterprise (Central custody of electronic documents)




                                                                                                        32
Supplement 2: Scheme of the One stop shop system




                                                   33

				
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