EY Law Alert, June 2023

Amendment to the Investment Promotion Act 

On 9 June 2023, the National Assembly adopted a new amendment to the Investment Promotion Act (hereinafter “the Act”). The amendment follows Regulation (EU) 2019/452 of the European Parliament and of the Council of 19 March 2019 establishing a framework for the screening of foreign direct investments into the Union.

Until now, the field of foreign investments has been regulated by the Act Determining the Intervention Measures to Mitigate and Remedy the Consequences of the COVID-19 Epidemic, which is in force until 30 June 2023. On 1 July 2023, the amendment to the Investment Promotion Act will enter into force.

The key changes stipulated by the amendment are:

• Change in the definition of foreign investor and foreign direct investment.
• Determination of the foreign investor's obligation to notify the foreign direct investment to the ministry responsible for the economy, no later than 15 days from the conclusion of a legal transaction by which the foreign investor directly or indirectly acquires at least 10% of the capital in an economic entity based in the Republic of Slovenia, or in voting rights or from the announcement of the takeover offer. The same obligation also applies to foreign investment in the field of initial investments.
• The preliminary procedure for reviewing received notifications, led by the Notifications Committee, has been newly regulated.
• The deadline for the review of direct foreign investments has been shortened from 5 years to 2 years.
• A contact point is being established, which will be aimed at reviewing direct foreign investments and exchanging information with the European Commission and other member states, which will be managed by the Ministry of Economy, Tourism and Sports.
• A new chapter has been added that regulates offenses and fines related to the notification and inspection of foreign direct investments.