R&I update - April 2020
Since the outbreak of COVID-19 in Europe, the Slovak Parliament has adopted a series of new laws aiming predominantly to support employment, to provide financial aid and tax relief (particularly to SMEs) and to preserve and regulate legal enforcement.
The insolvency law related measures include mainly:
The statutory time limit for debtors to file for bankruptcy due to over-indebtedness (balance sheet test) that occurred between 12 March and 30 April 2020 has been prolonged from 30 to 60 days (and is expected to be prolonged further).
New law on "temporary protection of undertakings" is in the pipeline. Protection will be available to all undertakings residing in Slovakia – except for undertakings already bankrupt as of 1 March 2020 and defined financial institutions – and will include (upon prior application) a moratorium on all future bankruptcy petitions to be submitted by creditors due to debtor's illiquidity.
All pending insolvency proceedings initiated by creditors are to be suspended during the protection period (ie expected until 1 October 2020). The protected debtor shall not be held liable for failing to file for bankruptcy in due time (due to their over-indebtedness). All individual debt enforcement proceedings initiated against the protected debtor are to be suspended and the performance of all ordered enforcement instruments shall be delayed. Statutory time limits for performance of lien rights shall not expire during the protection period.
Individuals and SMEs are entitled to request deferral of their loan payments for up to 9 months (this may not apply to defaulted clients and clients already in delay).
Performance of lien rights is generally suspended until 30 April 2020 (expected to be extended). Liquidation of debtor's assets and all legal instruments serving this purpose are to be delayed until 30 April 2020 (expected to be prolonged).
All statutory time limits for the assertion of claims shall not expire during the period of crisis. The time limits that have already expired as of 12 March 2020 shall be extended by an additional 30 days counting from 27 March 2020.
All court hearings shall take place during the crisis only in urgent cases and without public. All court related deadlines – such as for appeals, filing motions or further particulars – are stalled until 30 April 2020 (expected to be extended).