Under Slovak law, children and minors are protected by the Civil Code when it comes to the disposal of their property, major investments, or the conclusion of contracts. However, can a minor become a partner in a limited liability company or even a beneficial owner?
Slovak law protects the interests of minors in matters involving major investments, the conclusion of contracts, significant disposal of property, and so on. Under Slovak law, a minor cannot have full legal capacity. In the event that a minor acquires a business share but, due to a lack of legal capacity, cannot exercise the rights and obligations of a partner, all acts related to the operation of the company would have to be performed on their behalf by their legal representative, most often a parent. If the parent of a minor heir cannot perform acts related to the operation of the company on the minor’s behalf because the parent is already a partner in the company, the court shall appoint a guardian ad litem for the minor child, who will serve as his or her responsible representative. According to Section 28 of the Civil Code, “if legal representatives are also obligated to manage the property of those they represent, and if the matter is not of a routine nature, the disposal of the property requires court approval.” This provision is supplemented by Section 119 of the Civil Non-Contentious Procedure Code, which states: “A legal act performed by a legal representative on behalf of a minor shall be approved by the court if it is in the minor’s best interest.” Thus, if the disposition of property cannot be considered a routine matter—for example, the sale of a minor partner’s entire business share to another person—the competent court must approve such an act. The court approves a legal act performed in the minor’s interest in special proceedings concerning the court’s guardianship of minors. Similarly, the establishment of a business entity on behalf of a minor cannot be considered a routine matter; therefore, it is necessary to proceed in accordance with the cited statutory provisions and file a petition with the court for approval of the legal act on behalf of the minor. The court’s consent cannot be replaced by a general power of attorney granted by the minor.
Operation of a Trade by a Minor
Even if a minor comes to operate a trade, for example, when they inherit a business through which the trade was conducted, the legal representative must perform the acts related to the business on their behalf. Pursuant to Section 57(1)(a) of Act No. 455/1991 Coll. on Trade Licensing (Trade Licensing Act) “A trade license expires upon the death of a natural person (tradesperson) if the heirs or the estate administrator do not continue the trade; however, the license expires no later than upon the expiration of the period specified in Section 13(5).” In the case of a minor heir, this means that since they do not meet the general conditions for operating a trade, they must appoint a responsible representative who will meet the conditions for operating the trade, e.g., a parent. That representative will perform acts related to the operation of the trade on behalf of the minor heir. After the inheritance proceedings have concluded, such an heir may continue the trade only if they have actually inherited the property that was used to operate the trade. The continuation of the business must be reported to the relevant trade licensing office within one month of the conclusion of the inheritance proceedings. If the heir does not obtain their own trade license within six months of the conclusion of the inheritance proceedings, they may no longer operate the business.
Transfer of a Business Interest to a Minor
A minor may acquire a business share not only through inheritance but also through the transfer (gift) of a business share to a minor. The transfer of a business share is only possible if the articles of association do not preclude it. The articles of association may require the consent of the general meeting of the limited liability company for such a transfer.
It follows from the above that it is possible for a minor to be a partner; but in practice, it is important to bear in mind that almost every act performed by a legal representative on behalf of a minor must be approved by a court, which will take some time and thus slow down the entire process of the company’s proper operation.
