Key elements of strengthening commercial law framework in Slovakia Igor Pálka Allen & Overy Bratislava, s.r.o.

Key elements Overall harmonisation with EU laws – a must Corporate governance Start-up formalities Security reform Insolvency reform Judicial system – reform it first

Corporate governance EU company law directives Capital protection measures Related parties transactions Financial assistance Shareholders’ rights Public access to key corporate documents Securities law Directors’ liabilities

Start-up formalities Deadlines for registrations – five business days Introduction of registration forms Detailed rules for enclosures Limited (formal) examination of forms Examination done by clerical staff

Security reform (a revolution) Extensive definition of collateral (future assets) Non-possessory charges Public register of charges Out-of-court enforcement Removal of unjustified priorities Access to debt financing But the credit risk officers point to insolvency …

Insolvency reform More protection of each creditor’s interests Closing the “liability loop” Specifically refining rights of a secured creditor Giving the insolvent a chance – restructuring Bankruptcy – proceeds, speed, costs Institutionalisation of trustee’s profession

More protection of each creditor’s interest in: the maximum satisfaction quick, efficient and impartial resolution of the bankrupt’s situation protection of its pre-bankruptcy position protection against preferential treatment of other creditors control of disposals of assets in which it has an economic stake professional care of the trustee as a manager of the creditor’s stake

Closing the “liability loop” liability of the debtor and debtor directors’ liability liability of the trustee liability of the creditor creditor directors’ liability vis-à-vis shareholders of the creditor

Refining the rights of a secured creditor recognition of his own and separate estate no cross-subsidies between estates improved control over realisation prompt release of the realisation proceeds

Giving the insolvent a chance - restructuring conditions: business could be operated as a going concern better satisfaction of creditors reasonably expected a professional opinion about satisfaction of conditions being an "entry ticket" trust of creditors in the bankrupt and in the restructuring plan plays critical role open options of the plan without any limits "fresh money" – super priority

Bankruptcy – proceeds, speed, costs professional care when realising and administering assets under the supervision of creditors the trustee instead of a court at the helm of the process; court supervising and deciding within law trustee’s expenditure to be reasonable trustee must always act in a justified manner laws should motivate the trustee to be interested in winning creditors’ confidence by professional conduct and good results