Investor Presentaiton
The basic provisions governing business ob-
ligations and other specific aspects of doing
business in the Czech Republic are set out in
the Civil Code and the Act on Business Corpo-
rations, both effective as of 1 January 2014.
The Act on Business Corporations addresses
the main aspects of Czech corporate law. It also
regulates the relationship between companies
and their statutory representatives, their rights,
obligations and liabilities for breaches of due
care. Further, it sets out the rules for holding
companies and the liability for damage caused
by their controlling entities.
Types of business entities
The Act on Business Corporations recognises
the following types of business entities:
―limited liability companies;
-joint-stock companies;
- general partnerships;
limited partnerships;
co-operatives;
Societas Europaea (SE,
European Company);
― European Economic Interest
Grouping (EEIG).
In addition, foreign persons may establish
a branch in the Czech Republic.
A branch is not a legal entity, but must be reg-
istered in the Commercial Register.
The Act on Business Corporations regulates
the status and activities of entrepreneurs and
applies to both legal entities and individuals.
A Czech legal person is an entity that has its
registered office in the Czech Republic.
Foreign persons are defined as persons (indi-
viduals or legal entities) domiciled abroad or
having their registered office outside the Czech
Republic.
A foreign person's authorisation to carry out
business in the Czech Republic takes effect
on the date it is recorded in the Commercial
Register. This does not apply to citizens of the
member states of the EU, the EEA or Switzer-
land, their family members who have Czech
residence permits, citizens of other states with
long-term residence in the EU and their family
members with long-term residence permits.
A foreign person may participate in the es-
tablishment of a Czech legal entity or become
a partner or member of an existing Czech legal
entity. A foreign person may also be the sole
founder of a Czech legal entity, provided that
Czech law permits a company to have a sole
founder or sole shareholder.
The main characteristics of the various legal
entities are described below.
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