We can look at the current situation from the bright side in Slovenia,” laughs Grega Peljhan of Slovenia’s Rojs, Peljhan, Prelesnik & partnerji law firm. "We have Melania Trump and the world’s best cook, Ana Ros!"
Turning serious, Peljhan says that “the economy’s picking up and unemployment is doing down — so we can look quite positively towards the future.” Peljhan lays out just some of the encouraging developments: "A second wave of privatization is going on. The largest Slovenian bank, Nova Ljubljanska Banka, which is currently 100% state-owned, is going to an IPO this year, and the country’s 2nd largest bank will probably start the process this year as well. There are also some greenfield investments in the country: For instance Magna International is building a new factory here, and Yaskawa Electric is building a new robotics factory.” Peljhan describes these as “all good signs, meaning more work for us."
In addition, Peljhan says, “with the bank consolidation there’s quite a bit of M&A work, and the NPL markets are quite active, as NPLs from the three largest Slovenian banks (and some smaller banks as well) have been transferred to the Bank Asset Management Company, Slovenia’s bad bank, which is required to dispose of the assets, creating quite a bit of work on one side or the other."
Despite a generally positive outlook, Peljhan isn’t insensitive to the risks. “We also see some dangers,” he says, "tied primarily to the political situation and syndicates in the public sector. The syndicates in the pubic sector is putting huge pressure on the government to increase wages, which is likely to increase the deficit, and puts pressure on government to find the money. And there are attempts by the government to increase taxes, including taxes on profits. And the Ministry of Health is trying to pull contributions for health insurance from rent, profits, and everything, potentially increasing taxation about 6.5%.” Peljan describes this as “quite a huge increase."
"What’s also creating a problem for our sector is a very high tax on salaries,” Peljhan says. "For example, if we provide a salary of EUR 5000, we have to pay an additional EUR 10,000 in taxes. Consequently, it’s quite hard to keep the best people in Slovenia or to find people from outside.” The RPPP Partner sighs that this is "tough for law firms,” explaining that “if you want to have good people, you have to pay them, and this is, I would say, a problem. They also want to tax profits. For employers it’s a zero or even a minus game at the end of the day."
Peljhan describes the legal market and bar association as "pretty stable,” reflecting the “good leadership in the bar.” Peljhan notes the international law firms coming in to the country — "mainly from Austria” — but says “I would say it’s fair competition — we have to live with this.” He laughs: "We are definitely not furious. “ Indeed, Peljan — whose firm, he notes, is the largest in the country in headcount, turnover, and profits — notes that “they have been here for quite some time, but we are still managing to grow, so for us it’s ok.”
Indeed, there’s a clear bright side. “The market has gotten used to international standards,” Peljhan says, “ and to the quality of work.” What’s more , “it’s also good for us to have quality lawyers on the other side of the table.” As a result, he says, “if I look back 10 years, the sophistication of the deals has gotten really high. I can say we’re reaching Western standards.”