What to do to improve the Slovak capital market?7 quick wins, as Slovakia does not have the capacity for reforms today.

👉 Problem 1: There are hundreds of “large SICAVs” in the Czech Republic, 0 in the Czech Republic;
👉 Problem 2: Impossibility of predictable operation of a smaller real estate fund;
👉 Problem 3: Ambiguity of fund accounting (e.g., does it tax/not tax valuation differences?) and high administrative burden;
👉 Problem 4: Strange views of the tax administration;
👉 Problem 5: Double or triple taxation of mutual funds;
👉 Problem 6: Taxation of stable coins by transaction tax as well as double taxation;
👉 Problem 7: No retail funds in the real economy.

✅ Solution 1: More robust regulation of SICAVs and the introduction of a VAT exemption for portfolio management by a qualified manager (e.g. AIFDM, ELTIF or EuVECA);

✅ Solution 2: Making such funds available to a wider range of investors. In reality, a smaller real estate fund can only market to professional investors, and strangely enough, we cannot consider a real estate investor to be a professional investor;

✅ Solution 3: The MoF’s measure on funds is from 2007 and it would be advisable to (i) revise it, (ii) refine it and (iii) exclude taxation of valuation differences in the Income Tax Act;

✅ Solution 4: Prudence – do not go with opinions based primarily on intuition (e.g., the ability of PE/VC funds to exempt the sale of shares or the taxation of ETFs);

✅ Solution 5: The mutual fund becomes a taxpayer for income tax purposes;

✅ Solution 6: Recognise stablecoins in the Income Tax Act and explicitly exempt them from transaction tax;

✅ Solution 7: Make the rules for risk limitation and risk spreading for public special funds more flexible.

📌 And what not to do? 📌 Mainly not to talk about leaving the EU.

If we can’t even build a motorway to Košice or write a law on financial transaction tax, we would hardly be able to make Slovakia a Switzerland in capital markets law without the EU….. By the way a critical part of the regulations regulating the capital market are from the EU and all the problems above are problems of writing regulations in Slovakia.

P.S. In the photo is our capital team – including the guy who technically explains to us, for example, the functioning of crypto wallets for the purpose of writing directives to the National Bank of Slovakia.

And I am proud that even without the support of an international network, we at Highgate Law & Tax are able to identify the needs of the Slovak capital market and help it (and the state) to function with honest and creative advice despite the obstacles. And also to win the 2025 EPRAVO.CZ, a.s. Law Firm of the Year in Capital Markets Law.