According to the Slovak law, the statutory body of a limited liability company (hereinafter the “company”) consists of one or more managing directors. Managing directors are appointed by the general meeting from among the company’s shareholders or other natural persons, i.e. legal entities may never be appointed as managing directors.
Since October 2020, no natural person that is (at the time of making registration with the Slovak Commercial register) registered as an obliged party in the Register of issued authorizations to perform execution under a special law may become a managing director.
If there are several managing directors, each of them is entitled to act on behalf of the company independently, unless the company’s memorandum of association (or foundation deed in case of a single-shareholder company) stipulates otherwise. This means that the shareholders may for instance decide that all managing directors must always act collectively or that some of the managing directors must act collectively while others may act independently. The method by which the managing directors act on behalf of the company must be stipulated in the company’s memorandum of association.
As a statutory body, the managing director is entitled to act in all matters of the company. Executive powers of the managing director may only be restricted by the company’s memorandum of association or general meeting. However, such limitation is ineffective with respect to third parties.
The company shall be bound by the conduct of its managing director/s even if by their conduct they exceed the scope of the company’s subject of entrepreneurial activity (except when such conduct exceeds the authority of the statutory body granted by law or which may be granted by law to the statutory body).
Under the Slovak Commercial Code, managing directors are obliged to exercise their powers with professional care and in accordance with the interests of the company and all its shareholders.
Please be also informed that the Slovak Commercial Code prohibits managing directors from performing certain competitive activities (the so-called ban on competition). Unless additional limitations arise from memorandum of association/foundation deed or articles of association, managing directors must not:
- conclude, in his/her own name or on his/her own account, business deals related to the company’s entrepreneurial activity,
- mediate the company’s business deals for other parties,
- participate in the entrepreneurial activity of another company as a member with unlimited liability, and
- perform activities as the statutory body (or a member of the statutory body) or another body of another legal entity with a similar subject of entrepreneurial activity, unless it is a legal entity in the entrepreneurial activity of which the company in which they exercise the powers of managing director participates, or in which any of its shareholders or a person that is controlled by the same person as the shareholder is a shareholder, or in which any of its shareholders or a person that is controlled by the same person as the shareholder is a shareholder.