SLOVENIA: An Introduction

Economic Overview

The Republic of Slovenia (“Slovenia”), situated at the crossroads of Southern, Central, and Eastern Europe, has demonstrated remarkable economic resilience to global market fluctuations. Throughout the past two decades of its membership of the EU, Slovenia has experienced steady growth, with its export value soaring from EUR12.8 billion in 2004 to EUR54.9 billion in 2023 – more than quadrupling its trade volume. Slovenia experienced a moderate 1.6% gross GDP growth in 2024, with a forecast of GDP growth acceleration of 2.5% in 2025 and 2.6% in 2026.

Slovenia is in the middle of a process of extensive tax, administrative and governmental reforms set out by the centre-left government currently in the penultimate year of a four-year mandate. Some of the key proposed changes include:

• more incentives for foreign workforce;
• amendment of the Companies Act (“ZGD-1”) to implement four EU Directives – namely, Directive (EU) 2021/2101, Directive (EU) 2022/2381, Directive (EU) 2022/2464, and Directive (EU) 2023/2775 (the “Commission Delegated Directive”); and
• a new real estate tax.

Slovenia also issued EU’s first blockchain-based digital bond in July 2024.

Environmental and Infrastructural Developments

After achieving its goal of 25% of renewable energy share in 2023, Slovenia continued with ambitious projects in 2024 – the most of notable of which taking place in the field of nuclear energy, with plans underway for a second unit of Krško Nuclear Power Plant (“NEK2”). Following a cancelled consultative referendum, the project is expected to proceed to implementation, at an estimated cost of between EUR9.6 and EUR15.4 billion.

Furthermore, the Slovenian government updated its Integrated National Energy and Climate Plan for 2030, setting its goals for the transition into clean and efficient energy. Consumers face rising energy bills mostly due to the market deregulation efforts; however, almost 8% of households operate home solar energy systems. Natural gas supply remains stable despite recent global events, as Slovenia has diversified its sources through Algiers, Azerbaijan, and even Norway.

The main anticipated infrastructure projects include reconstruction of key rail corridors and stations, including Ljubljana’s main railway station.

M&A Market Overview

The Slovenian M&A market has seen some major deals in 2024, thus continuing the dynamic trend seen in the preceding years despite the overall global high interest rate-induced bear M&A market. Most notable M&A transactions happened in the banking sector, food and nutrition supplements sectors, and the fields of telecommunications and retail.

The trend for private transactions continues in 2025, with limited liability companies being the primary targets. Slovenian M&A activity is expected to remain relatively consistent with previous years in 2025 – although increased minimum wages and rising fixed costs (eg, for electricity) are likely to impact the market.

Legislative Landscape Dynamics

Corporate

Several regulations impact the M&A sector, particularly for limited liability and joint stock companies. The key legal framework for the latter is the Companies Act, which recently underwent significant amendments. The latest (the “ZGD-1M amendment”) was adopted on 22 November 2024, transposing the above-mentioned four EU Directives into Slovenian law. These EU Directives introduce public tax reporting obligations for large companies, expanded sustainability reporting requirements, and measures to promote gender balance in corporate leadership.

Other key changes under the ZGD-1M amendment include:

• mandatory visible company signage at registered business locations;
• revised criteria for defining subjects of public interest; and
• updated tax and sustainability reporting obligations for large companies.

Slovenia has also introduced a new standard classification of activities (SKD 2025), in force from 1 January 2025, replacing the 17-year-old SKD 2008.

IT

Slovenia has established itself as a key digital hub in the CEE region, attracting both crypto and traditional IT companies, while its national IT legislation primarily aligns with EU regulatory developments. In November 2024, Slovenia transposed the Markets in Crypto-Assets (MiCA) Regulation into its legal framework – thereby introducing a six-month transitional period for crypto-asset service providers, who must achieve full compliance by 1 July 2025.

The process of adoption of the amended Information Security Act (“ZInfV-1”) is also underway. The aim of the amendment is to implement measures for a high common level of cybersecurity under the EU Network and Information Security Directive (“NIS2”) by strengthening the core cybersecurity requirements.

Additionally, Slovenia has yet to finalise regulations defining procedures, penalties and competent authorities under the Digital Operational Resilience Act (DORA). This will be crucial for ensuring the stability and security of financial services in the digital age.

Employment

The employment relations landscape has seen some significant regulatory changes – most notably, with regard to the life–work balance segment. A new amendment to the Foreigners Act (“ZTuj-1”) is in preparation, aiming to implement the Directive (EU) 2021/1883 (the main objectives of which are to ease the work permits obtainment process and to establish special treatment for digital nomads).

Antitrust

In 2024, Slovenia enacted the new amendment to the Act on the Prevention of Restriction of Competition (“ZPOmK-2A”). This introduced several changes, including:

• standardisation of investigations;
• administrative sanctions on companies; and
• an improved framework for international co-operation.

The Slovenian Competition Protection Agency has increased in its supervisory activities in 2024, with particular focus on food supply chains and online delivery platforms.

Tax

A new Value Added Tax (VAT) Act entered into force on 1 January 2025, introducing VAT grouping for related entities, a five-year limit on carrying forward VAT surpluses, mandatory VAT record-keeping, and higher VAT rates for sugary drinks.

In the field of personal income, new tax reliefs for foreign workers and returning Slovenian citizens have been introduced via the latest amendment to the Personal Income Tax (PIT) Act, along with incentives for employee ownership in start-ups. Other changes include new taxation rules for electric vehicle benefits, modifications to standardised sole proprietors’ tax treatment, and a five-year limitation on carrying forward tax losses.

The Slovenian government has also proposed the introduction of a new 1.45% annual real estate tax.

Legal, Financial and Economic Outlook

Slovenia’s legal, financial, and economic landscape is set to evolve in response both to domestic reforms and broader European trends. The country is prioritising fiscal stability and tax modernisation, with recent legislative amendments aimed at enhancing efficiency, transparency, and compliance. As digitalisation accelerates, regulatory frameworks will likely adapt to emerging technologies, fintech innovations, and cross-border business models. Meanwhile, Slovenia’s commitment to sustainability is reflected in incentives for green investments and tax benefits for eco-friendly initiatives, aligning with EU climate goals.

Economically, Slovenia is expected to maintain steady growth, supported by strong exports, increasing foreign investment, and a resilient labour market. However, challenges remain, including demographic shifts, an ageing workforce, and inflationary pressures. The Slovenian government is likely to introduce further reforms to address these issues, such as policies encouraging entrepreneurship and skilled migration.

In the financial sector, tighter EU regulations on banking and corporate governance will shape the future business environment – ensuring stability but also requiring companies to adapt. Overall, Slovenia is positioning itself as a forward-looking, business-friendly economy by balancing regulatory oversight with incentives for innovation and sustainable development.