Consumer protection in the Slovak Republic stems partially from the EU harmonization, therefore provisions similar to the Slovak regulations can be expected also in other EU countries. On the other hand, EU countries are allowed to apply some additional consumer protection arrangements, so rules applicable in each EU country (including the Slovak Republic) should be crosschecked. For an e-shop, especially provisions relating to consumer contracts (and particularly to distance contracts) are relevant. A distance contract is a contract:

Among these rules, it is possible to highlight provisions imposing information obligation on the trader towards the consumer, provisions regulating the process of concluding the contract and provisions regulating the content of the contract (prohibited provisions, termination of the contract, quality guarantee and the consumer’s claims from defects of the performance, etc.). The operator of the e-shop should ensure that the web page where the e-shop is located contains all the information required by law and that the contract concluded through the e-shop respects all the consumer’s rights.

Information duty

Before the conclusion of a contract, i.e. generally before an order through the e-shop is finished, the consumer should be informed about the identity of the trader, his address, contact details, specification of the goods or services offered, final price of the goods and services (including value added tax and all other taxes and fees), means of payment and delivery, delivery costs, claims arising from faulty performance or warranty and conditions for their application, length of duration of the contract and ways to terminate it (steps, period for withdrawal and procedure of withdrawal included), costs of distance communication, amount of eventual advance payments, body competent for settlement of consumer disputes, etc.

Process of conclusion of the contract

Consumers should be informed about particular steps of concluding the contract and before final placing of the order should have a chance to verify and eventually correct the data inserted into the order. The trader should also inform the consumer where the concluded contract is available for the consumer, about languages in which the contract can be concluded or any rules of behaviour bounding on the trader.

After the order is placed by the consumer, the trader is obligated to immediately confirm receipt of the order also by one of the means of distance communication (for example by an e-mail).

Content of the contract

The contract concluded through the e-shop is regulated by the applicable law. For a private contract, the principle of contractual freedom usually applies, nevertheless in the case of consumer contracts, the freedom is to a significant extent limited in favour of the consumer.

First, certain provisions are explicitly prohibited by law and cannot be applied by the trader. Arrangements establishing disproportional unbalance between rights and obligations of the trader and of the consumer are prohibited in general.

In addition, the contract cannot contain arrangements restricting or excluding consumers’ rights from faulty performance, allowing the trader to withdraw from the contract without any reason, allowing the trader to change unilaterally rights and obligations of the parties to the contract, disallowing the consumer to file an action at court and forcing him to sue the trader at an arbitration court not being bound by the consumer protection provisions, etc.

Slovak law also contains some provisions protecting consumers that are applicable for all sales contracts, not only distance contracts.

It is worth mentioning that under these provisions the consumer is entitled to raise claims from faulty performance within 24 months from takeover of the goods (or within the warranty period stated on the cover). These provisions also determine the respective claims consumers have in case of faulty performance.

In case of distance contracts consumers also have the right to withdraw from the contract without any reason within 14 days from takeover of the goods (it is sufficient that the consumer dispatched the withdrawal announcement within this term). If the consumers have not been informed about this right by the trader even afterwards, the period for withdrawal prolongs to 1 year and 14 days.

For avoidance of disputes, it is recommended to offer to the customers a template withdrawal form. When this form is used by the customer, the trader is obligated to confirm its receipt within undue delay. The consumer must return the goods obtained on the basis of the contract within 14 days from the withdrawal. Within the same period, the trader is obligated to return the price paid by the consumer together with delivery costs in the manner the price was paid or in a manner agreed on with the consumer.

When placing the order, the traders often require customers to provide to the trader certain personal data, such as name, address, phone number, e-mail address, date of birth, sex. Such personal data serve mainly for invoicing and delivery of the goods and services, however, some traders use the personal data also for other purposes, such as marketing, advertising, references, statistics, etc. Processing of personal data is regulated, and when a trader processes personal data, statutory obligations must be fulfilled.

Processing of personal data is allowed only if at least one of the statutory titles is met, only for the purpose for which they were obtained, only for as long as a legitimate reason for their processing exists and only with regard to data that are necessary for fulfilment of the purpose of their processing (exceptions apply).

Before processing may commence, the customer has to be informed about the purpose of processing the data (the purpose must be laid down by the controller before processing of the data is commenced), who will be processing the data, what kind of data will be processed, for how long the data will be processed and about rights of the data subject regarding access to, correction of, or destruction of the data and other information required by law. The controller is also obliged to adopt technical and organizational measures preventing leakage and abuse of the personal data of the customers and such measures must be documented. Employees of the controller are bound by the statutory confidentiality duty with regard to the data and the measures adopted for their protection.

Commercial messages

Sending commercial messages is a common practice for e-shops, whether it is sending information about new products or birthday cards. Commercial communications are generally considered to be all forms of communication, including advertising and solicitations to visit websites, intended to directly or indirectly to promote the goods or services or the image of the business that the trader sends to its customers or potential customers.

This is the case when the e-shop operator receives electronic contact (e.g. e-mail) from its customer in connection with the sale of products or services. The e-shop operator may send commercial communications to the e-mail received in this way, provided that the customer has the possibility to easily and free of charge refuse such commercial communications and that the commercial communications concern similar products or services purchased by the customer on the e-shop.

Cookies

Almost every e-shop operator uses cookies on its website. Cookies are small text files that are stored on the hard drive of the computer or other device from which the visitor browses the website. Cookies have various uses, such as ensuring the technical operation of a website, enabling website operators to understand visitor preferences, create targeted advertisements or obtain other information about customer behaviour.

This rule applies to all types of cookies except those necessary for the operation of the website. Unlike the previous opt-out regulation, this requires activity on the part of the website user. As a consequence of this amendment, the wording of the cookie bar needs to be adjusted so that users can give consent separately for each type of cookie.

Often, website operators use a so-called cookie wall (i.e. a window that blocks the user from further access to the website until they agree to the use of cookies). Please note that such consent, which is essentially forced, cannot be considered free and as such does not comply with the requirements of the GDPR.

Conducting a business on the territory of the Slovak Republic is usually connected with various tax registrations. The corporate income tax registration and value added tax registration are the most common for an e-shop.

Corporate income tax registration

Provided that the e-shop carries out its activities through a company established for this purpose in the Slovak Republic, it is liable to register for corporate income tax purposes by the end of calendar month following the month in which the trading licence was obtained, i.e. it was registered in the Commercial Register.

If on the other hand the e-shop would have no physical presence on the territory of the Slovak Republic, the liability to corporate income tax registration and related duties would not arise.

It is impossible to provide a full list of activities that would or would not lead to permanent establishment creation. To come up with a relevant conclusion on this issue both the Slovak tax legislation and the Double Tax Treaty concluded between the Slovak Republic and the country of which the entity operating the e-shop is a tax resident should be analysed.

To provide an indication of situations both leading and not leading to Slovak permanent establishment creation, a few examples are described below.

Corporate income tax filing obligations

Once registered for corporate income tax purposes, the e-shop is liable to file its Slovak corporate income tax return on annual basis. The time-limit for filing the return is generally three months following the end of the taxable (accounting) period. The filing deadline may be extended by maximum 3 or 6 months (if part of a taxpayer’s tax base consists of foreign-source income).

The corporate income tax liability (self-assessed by the e-shop) is payable within the filing deadline.

As a consequence of the corporate income tax liability, the obligation to corporate income tax advance payments arises. Advance payments must be paid quarterly if the last known tax liability ranges between EUR 5,000 – EUR 16,600. In this case the advance payment is 1/4 of the last known tax liability.

If the last known tax liability is higher than EUR 16,600, the advance payment is 1/12 of the last known tax liability and is paid monthly.

VAT registration

Provided that the e-shop has registered seat, place of business or fixed establishment in the Slovak Republic, the threshold for mandatory VAT registration is the turnover of EUR 49,790 for a period of immediately preceding 12 consecutive calendar months.

A foreign taxable person that realizes long-distance sales (i.e. sale of goods via e-shop) in the Slovak Republic to Slovak final customers has to register for VAT in the Slovak Republic if the total value of the transactions carried out to the European Union customers reaches EUR 10,000 in the relevant calendar year and the year immediately preceding and is not registered to One Stop Shop scheme in his home country.

The entity operating the e-shop (both Slovak and foreign) may however apply for voluntary VAT registration. The process of voluntary VAT registration is more demanding from the administrative perspective lately.

VAT filing obligations

Once VAT registered, a liability to file VAT returns in which the VAT liability or entitlement to VAT recovery are calculated and reported arises. The compulsory VAT reporting period for newly registered VAT payers is a calendar month.

Starting from 2014, VAT registered persons are also obliged to file special tax return called VAT Control Statement through which further details on transactions are reported (e.g., invoice number, identification of supplier or customer, tax base, VAT amount). The VAT Control Statement is filed within the same deadlines as are relevant for VAT returns filing. The VAT Control Statement is only a reporting tool that allows financial authorities to have more control over correct and complete reporting of VAT liabilities.

VAT identified person

Even if not VAT registered in the Slovak Republic, the e-shop should be aware of the risk of becoming VAT identified person. The e-shop would become liable to register as VAT identified person in the following situations:

In the situations described under the first two bullet points, the VAT identified person becomes liable to file VAT return through which the Slovak VAT liability is reported. At the same time no entitlement to input VAT deduction arises to the VAT identified person. Regarding the second bullet point, it has to be added that if services are acquired from persons established outside EU, obligation to identify for VAT does not arise however the liability to file VAT return and pay VAT liability still applies. In the third case a liability to file VAT return and EC sales list arises. No liability to pay output VAT and apply input VAT deduction is connected with filing the VAT return. The VAT return serves for reporting purposes only.

Other tax registrations

The liability to other tax registrations should be assessed with regard to the nature of the e-shop and its operations. As relevant examples could serve registration to personal income tax from employment activities provided that the entity operating the e-shop has employees, registration to road tax if the entity operating the e-shop operates vehicles for business purposes in the Slovak Republic, real estate tax registration if the entity operating the e-shop owns real estate in the Slovak Republic, etc.

Below we comment on the liability of the e-shop to declare the sale of goods through a tax document as defined by the Slovak VAT legislation.

The liability to issue a tax document declaring the sale depends on whether the e-shop is VAT registered in the Slovak Republic or not. Our comments to individual scenarios follow below.

Goods delivered within the Slovak Republic

Goods sold to Slovak end customer (non – taxable person)

In the case of a warranty claim from the customer, the e-shop is liable to issue a confirmation of the warranty claim and a report on the settlement of the warranty claim (declaring how the customer’s claim was dealt with). None of these documents are tax documents.

In this case it will be sufficient for an e-shop to issue any convenient document that will indicate the following information: identification of the e-shop (business name, seat, registration number, VAT number), identification of the customer (name, address), date of order, delivery date, description of the goods sold, total amount including VAT, advance payment, amount to be paid.

Goods sold to person liable to VAT

If the e-shop sells goods to a person liable to VAT, the liability to issue a tax document depends on whether the e-shop is VAT registered in the Slovak Republic or not.

As required by the Slovak VAT legislation, the tax document must provide the following information: identification of the e-shop (business name, seat, registration number, VAT number), identification of the customer (name, address), description of the goods sold, date of taxable supply (delivery date or date of advance payment receipt), date of issuance of the tax document, unit price of the goods sold excluding VAT and discount (if the discount is not included in the unit price), VAT base, VAT rate, amount of VAT in EUR, total amount to be paid.

In case of exchange or return of the goods, a liability to issue corrective VAT document will arise. Based on  the Slovak VAT legislation the corrective VAT document must state the following information: Identification of the e-shop (business name, seat, registration number, VAT number), identification of the customer (name, address), evidence number of the original tax document, evidence number of the corrective VAT document, reason for issuance of the corrective tax document, difference between the original and corrected tax base, difference between the original and corrected amount of VAT, difference between the original and corrected amount to be paid by the customer.

Goods transported from EU

Goods sold to Slovak end customer (non-taxable person) – distant sale

If the goods sold to Slovak end customer (non-taxable person) are at the time of their sale located on the territory of the EU, the liability to declare the sale of the goods by a tax document will depend on whether the EU e-shop is VAT registered in the Slovak Republic or not.

If the e-shop is not VAT registered in the Slovak Republic, the VAT legislation of the country where the EU e-shop is VAT registered will be followed when it comes to issuance of VAT documents.

As required by the Slovak VAT legislation, the tax document must provide the following information: identification of the e-shop (business name, seat, registration number, VAT number), identification of the customer (name, address), description of the goods sold, date of taxable supply (delivery date or date of advance payment receipt), date of issuance of the tax document, unit price of the goods sold excluding VAT and discount (if the discount is not included in the unit price), VAT base, VAT rate, amount of VAT in EUR, total amount to be paid.

In the case of exchange or return of the goods, a liability to issue corrective VAT document will arise. Based on  the Slovak VAT legislation the corrective VAT document must state the following information: Identification of the e-shop (business name, seat, registration number, VAT number), identification of the customer (name, address), evidence number of the original tax document, evidence number of the corrective VAT document, reason for issuance of the corrective tax document, difference between the original and corrected tax base, difference between the original and corrected amount of VAT, difference between the original and corrected amount to be paid by the customer.

Goods sold to person liable to VAT

In the case of sale of goods to a person liable to VAT, the rules for issuance of a VAT document as valid in the given EU country will apply. The rules of the given EU country will also apply to a situation when receiving VAT advances from the customers, or in case of exchange or return of the goods.

Goods transported from 3rd country

Goods sold to Slovak end customer (non-taxable person)

If the goods are transported to Slovak end customer from a 3rd country, then regulations of the 3rd country are decisive when it comes to rules governing the issuance of VAT/sales documents.

On July 1, 2021 the VAT exemption for the importation of goods not exceeding EUR 22 has been removed. As a result, all goods imported to the EU are subject to VAT.

If the sale of goods is facilitated by online sellers or through an electronic interface (e-shop) to buyers in the EU, the seller/electronic interface is considered to have made the sale and is in principle liable for the payment of VAT.

To simplify the declaration and payment of VAT for goods sold from a distance by sellers from either the EU or from a non-EU country or territory the seller may apply for Import One-Stop Shop (IOSS). If a business is not based in the EU, it will normally need to appoint an EU-established intermediary to fulfil its VAT obligations under IOSS. The IOSS simplification is applicable only to purchases made by a buyer within the EU and for goods, which is not subject to excise duties and at the same time is valued at less than EUR 150. For goods valued more than EUR 150 shall apply the rules for standard import of goods from a non-EU country.

Goods sold to a person liable to VAT

If the goods are transported to Slovak end customer from a 3rd country, then regulations of the 3rd country are decisive when it comes to rules governing the issuance of VAT/sales documents.

It is essential for the e-shop (with no regard to the destination from where the goods are shipped) to be able to prove both the date of receiving the advance payment (in case of receiving advances from the customers) as well as the date of taxable supply (i.e. the date on which the customer overtakes the goods). Receipt of the payment can be proved by a bank account statement in case of card/bank transfer or by a confirmation from courier company in case of cash on delivery. The handover of the goods to the customer can be proved by a confirmation issued by the courier company proving that the goods were handed over to the customer or by a delivery note. Even though there is no legal obligation to issue delivery notes, it is a common practice in case of e-shop sale.