Government Approved Law on the Protection of Citizens Deposits
According to the Protection of Citizens Deposits Law adopted by the government, all banks in Slovakia (except branches of foreign banks who have deposits insured in the home country) will be obliged to pay into the Protection of Deposits Fund. The entrance fee will be 1m Sk (100m Sk in case of the National Bank) and annual fees will be 0.1 - 0.3% of all deposits as of the end of the previous year. In special cases, an extraordinary fee can be set. If a bank is not able to repay all its deposits, the Fund will pay off non-anonymous deposits up to 30 - times the average monthly salary (7,170 Sk in 1995).
An Amendment to the Income Tax Law returned to the Parliament
President Michal Kovae returned an amendment to the Income Tax Law - passed in Parliament earlier this month - back to the chamber, saying he considered it to be at variance with the Constitution.
The amendment allows purchasers of newly - privatized company's to deduct the purchase price of their investment, if the sale agreement with the Fund of National Property states that the purchase price is tax deductible.
International Public Tender for Installation and Maintenance of a GSM Mobile Phone Net on the territory of the Slovak Republic
The Ministry of Transportation announced that it will issue two licences for public mobile communication services through the standard global system for mobile telephones, the GSM.
Based on guidelines established by the Ministry of Transportation, a condition for obtaining a licence, which will cost 8 m USD, will be that the licence can only be obtained by a company with a 60% domestic and 40% foreign capital share breakdown.
The licences will be provided in July or August, while the net will be completed by the end of this year.
Amendment to the Bank Law
The amendment to the Bank Law 21/1992 Coll approved in January 1996 by the Slovak Parliament will enter into force on 1 March 1996.
All the subjects operating banking services will be obliged to follow new or amended rules.
Amongst other changes the amendment outlines the conditions for providing mortgages (limited to 60% of real estate value and only banks seated in the Slovak Republic can provide a mortgage).
Concept of Trading with Bonds not Approved
The concept of further trading with bonds of the Fund of National Property gained in the second wave of privatization was not approved by the government.
The concept will detail the conditions of trading with the bonds.
The nominal value of bonds, with a maturity date 31 December 2000, is 33.4 bn Sk.
The information in this newsletter is correct to the best of our knowledge and belief at the time of going to press. Specific advice should be sought, however, before investment and other decisions are made.
Please address any questions to:
Tax and business advisory services:
Ruth Clamp/Paul Suchar/
Antonin Masaryk
Audit and accounting services:
Santiago Pardo/Alexander Koprda
Arthur Andersen Prague, tel: +42 2 2440 1300, or enter text search 'Arthur Andersen' and 'Business Monitor'.
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