Don’t Forget to Register in the RPVS!

In Slovakia, the public Register of Public Sector Partners (RPVS) has existed for several years now. Registration is mandatory for all entities that receive financial means or other benefits from public sources above a certain threshold.

The purpose of the RPVS is to ensure transparency and public oversight in the management of public funds in Slovakia. This allows the public sector to know with whom they are actually doing business. This shall facilitate combating corruption, uncovering potential conflicts of interest and identifying connections to public figures. Detailed information about individuals and companies involved in public contracts, as well as their ultimate beneficial owners (individuals who in effect benefit from their activities) must be recorded in the RPVS and regularly verified and updated. 

The RPVS may not receive as much attention today as it did when the law first came into effect. Nevertheless, it remains highly relevant. Any company or individual interested in participating in projects funded by public resources in the Slovak Republic should first carefully check whether they are required to register. Failure to do so could result in various penalties, among them financial fines or refusal to pay. 

Who is Currently Required to Register in the RPVS? 

The registration requirement applies to agreements with government institutions, municipalities, or public organizations for the supply of goods or services if the contract’s value exceeds EUR 100,000 or EUR 250,000 in case of multiple partial or recurring performances. However, this is just the general rule; depending on the individual circumstances, this obligation may arise in other cases as well.

This Also Applies to Subcontractors 

Be aware that it is not only the entities who win public contracts and directly enter into contracts with the public sector that are required to register, but also its subcontractors. This applies if the value of the contract between the company and their subcontractor exceeds the above-mentioned limits. In fact, if these conditions are met, even the subcontractors of subcontractors are required to register. 

How the Registration Process Works 

Registration in the RPVS can only be performed by so-called authorized persons. In practice, registration is usually carried out by attorneys, less commonly by notaries, tax advisors, or auditors. The authorized person must thoroughly examine the ownership and management structure of the company to be registered. At the latest after the company wins the contract, usually contacts an attorney, who then examines their ownership and management structure, identifies ultimate beneficiaries, prepares the necessary documentation, and submits the registration proposal to the relevant registration court. 

Based on our practical experience as an authorized person, we assess the development to date of the legal framework around the RPVS as mostly positive. We particularly appreciate the changes that allow us to expedite the registration process for our clients, enabling them to promptly take advantage of related business opportunities. 

Are You Concerned About the Disclosure of Your Addresses in the RPVS? An Exception Might Apply

The law is very strict regarding the data that must be recorded and subsequently published in the RPVS. One of the mandatory pieces of information that must be disclosed is the permanent residence address of the ultimate beneficiaries. This requirement might be discouraging for individuals. However, since the introduction of the RPVS, there has been a notable change. Now, the law considers individual circumstances on the part of the ultimate beneficiary that may justify an exemption from this rule. 

The addresses of the ultimate beneficiaries will not be published in the RPVS if the company can sufficiently prove to the registration court that their disclosure could pose a threat to the security or rights to personal protection of the ultimate beneficiaries or their close persons. The registration court will, however, not accept a simple hypothetical claim that this could happen. To prove these extraordinary circumstances, affidavits and supporting documents are most commonly used. 

So the law today at least partially addresses the concerns of ultimate beneficiaries about the disclosure of their permanent residence addresses. We view this exemption positively, however we would welcome reconsideration of its broader application or a different approach that would address the concerns of our clients as fully as possible.

By Mgr. David Benčat & JUDr. Valter Pieger

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