Overview of the main provisions of PKP10 (Act on Additional Measures to Stop Spreading and Mitigate, Control, Recover and Eliminate the Consequences of COVID-19)
On 27 December 2021, the National Assembly of the Republic of Slovenia adopted Act on Additional Measures to Stop Spreading and Mitigate, Control, Recover and Eliminate the Consequences of COVID-19 (the " ZDUPŠOP" or "PKP10"). PKP10 will enter into force on the day following its publication in the Official Gazette of the Republic of Slovenia. Due to National Council not voting a veto on the new legislation, we expect the PKP10 to be published in the Official Gazette the Republic of Slovenia soon.
The reason of the legislator to adopt PKP10 is the increasing number of people infected with COVID-19 and the consequent increase in the capacity of hospital beds for COVID-19 patients. The measures contained in PKP10 are expected to help to stop spreading, mitigate, control, recover from and eliminate the consequences of COVID-19 in the health, labour, social security and economic sector.
Below review includes an overview of the major changes introduced by PKP10 in the areas of labour, commercial and tax law.
Impact of PKP10 on labour law
In early November 2021, the Government of the Republic of Slovenia adopted the Ordinance on the temporary measures for the prevention and control of infectious disease COVID-19, which, among other things, imposes the obligation to comply with the RVT rule for the duration of work on all workers and persons performing work for an employer on any other legal basis. Screening of workers must be provided by employers, and the PKP10 provides a legal basis for employers to provide financial support for the purchase of rapid antigen self-testing kits. The employer is entitled to an aid of EUR 92.50 per worker for the purchase of rapid antigen self-testing kits. Self-employed workers, partners or shareholders of a company who are also managers and are covered by the mandatory pension and disability insurance, and farmers and religious servants who are covered by the mandatory disability insurance and pension are also considered as ‘workers’. The employer is only entitled to the aid for those workers who are required to self-test under the COVID-19 regulations. Employers will be able to claim the aid by means of a declaration submitted to the Financial Administration of the Republic of Slovenia information system. The number of employees will be counted on the date of the declaration. The period of eligibility is from 8 November 2021 to 31 January 2022, with a possible extension of 5 months. The last day for submitting the declaration is 15 February 2022 (which may be extended if the measure is extended) and the aid will be paid in a lump sum by Financial Administration of the Republic of Slovenia by 31 March 2022 at the latest.
PKP10 extends the period for workers to take annual leave which they have been unable to take because of urgent work needs related to the control of the COVID-19 virus or because of the consequences of the COVID-19 epidemic. Workers who have been unable to take annual leave for 2020 in the year 2021 will be entitled to take it by 1 April 2022, and they will be entitled to take annual leave for 2021 until 31 December 2022.
PKP10 also extends the simplified way of notifying on work from home. In short, the simplified notification method means that employers, before starting to carry out work from home, notify the Labour Inspectorate of the Republic of Slovenia with a declaration submitted via an electronic application. The declaration must contain information on the employer, the worker who will carry out work from home and the potential risk to workers’ safety and health. The simplified notification of work from home measure is extended until 31 December 2022.
In addition, PKP10 also extends the measure on salary compensation in the event of quarantine and force majeure and the measure on the use of sick leave without a certificate of justified absence. The measure of salary compensation for ordered quarantine or force majeure (i.e. childcare obligations or stoppage of public transport or border closures) is extended until 31 March 2022 (with the possibility of an extension of 3 months). The measure allowing workers to take sick leave without having to produce a medical certificate justifying their absence from work is extended until 28 February 2022 (with a possible extension of 3 months). The worker can only benefit from this measure in the event of absence of up to three consecutive days at a time and at most once in each calendar year.
Financial incentives for business
PKP10 extends the financial incentive measure under the COVID-19 financial incentive scheme provided for in the Act Determining the Intervention Measures to Mitigate and Remedy the Consequences of the COVID-19 Epidemic (the “ZIUOOPE”). The ZIUOOPE provides the legal basis for the granting of financial incentives in the form of grants and repayable funds to ensure the ongoing operation and liquidity of companies and the adequate security or safety of companies in order to prevent the spread of COVID-19, to co-finance revenue losses in tourism and hospitality, to provide support to manufacturing in border problem areas, to ensure the digitisation and digital transformation of companies, and to development projects under way or with the potential for rapid take-off. The beneficiaries of financial incentives are micro, small and medium-sized companies1 and large companies facing the negative consequences of the epidemic. The financial incentive is granted on the basis of an application submitted by the beneficiary in response to a public call for tenders or call for proposals, in the form of a percentage of the project financing, a lump sum or other simplified forms of costs. The detailed requirements and, in the case of a public call for tenders, the criteria for granting financial aid shall be laid down by the Minister responsible for the economy.
In addition, a new liquidity facility is foreseen through the Slovene Enterprise Facility, amounting to EUR 10 million per year for 2021 and 2022. The funds will be provided by the State from the budget and transferred to the Facility for this purpose.
Removing obstacles to significant investments
On 31 May 2020, the Intervention Act to Remove Obstacles to the Implementation of Significant Investments to Start the Economy After the COVID-19 Epidemic (the “IZOOPIZG”) entered into force, which sets out the criteria for the identification of significant investments for the start-up of the economy after the COVID-19 epidemic and the prioritisation of these investments by the competent authorities. The Government included 349 projects on the list of important investments and subsequently expanded the list. The IZOOPIZG was initially to apply until 31 December 2021, but with PKP10 the legislator extended the period of application of the IZOOPIZG by 1 year.
Tax law measures
In PKP6 the legislator has already adopted the exemption from import duties and VAT for imports of goods needed to cope with the consequences of the COVID-19 outbreak. According to this exemption, the supplies of protective and medical equipment, including intra-EU acquisitions of these goods, from the list of goods established by the Government and subject to exemption from import duties and VAT on importation in relation to Commission Decision (EU) 2020/491 on the exemption from import duties and VAT on imports for goods needed to cope with the consequences of the COVID-19 outbreak in 2022, are exempt from VAT, with the right to deduct VAT, provided that the following conditions are cumulatively fulfilled:
(a) the goods are intended for:
distribution free of charge to persons affected by, exposed to or coping with the outbreak by the authorities and organisations referred to in point (b) of this paragraph; or
free of charge for use by persons affected by, exposed to or coping with an epidemic, provided that the goods remain in the possession of the authorities and organisations referred to in point (b) of this paragraph
(b) the goods are supplied to or on behalf of a governmental authority or organisation, a local authority, another body governed by public law, or another organisation which is regarded as a charitable organisation under the rules, or the goods are acquired from another Member State of the European Union by another person on behalf of those authorities and organisations.
In accordance with PKP10, this exemption measure will continue to apply in 2022.
In addition to the above, PKP10 also introduces a number of other changes and novelties in other areas, including in particular the facilitation of the establishment of public funds by municipalities2, the extension of the validity of the 2020 tourist vouchers until 30 June 2022, the payment of a solidarity allowance to low-pension pensioners and certain other vulnerable groups, and the payment of a daily allowance to volunteers who have taken up a job and are working in health and social care institutions, assisting with mobile vaccination or testing.
1. Micro, small or medium-sized companies are defined in Commission Regulation (EU) No 651/2014 of 17 June 2014 declaring certain categories of aid compatible with the internal market in application of Articles 107 and 108 of the Treaty Text with EEA relevance (OJ L 187, 26 June 2014, p. 1).
2. In accordance with the amendments resulting from PKP10, a municipality may establish a public fund if it provides earmarked assets worth EUR 2,500,00 (previously EUR 10,000,000).