29th September 2017

Czech Legislation Update August, September 2017

The Chamber of Deputies agreed with the ratification of the Canada-EU Comprehensive Economic and Trade Agreement CETA. The agreement was submitted to the President.

The Chamber of Deputies agreed with the ratification of the Paris Agreement. The agreement was submitted to the President.

In July 2017, new labor law provisions came into effect, including new specification of non-discrimination, new rules for employment agencies, or new sanctions under the Labor Inspection Act, for example. Read more in a summary by Dvořák Hager & Partners (in Czech).

On 15 August, amended Act on the Residence of Foreigners in the Czech Republic came into effect, including new rules for residence permits and employment of intra-company transferees (Intra-Company Employee Transfer Card), among others. Read details in English by the Ministry of the Interior, or in Czech.

Earlier in summer, the Government has approved the introduction of a visa program for non-EU investors, foreign Minister Lubomir Zaoralek said at a press conference. Foreigners who invest at least 75 million Czech crowns in the Czech Republic and create at least 20 new jobs will be able to apply for a long-term residence permit. The Economic Chamber has criticized the measure saying that the conditions are too strict. (Source: epravo.cz)

On 18 August, the Interior Ministry published draft law on the processing of personal data, which was drafted in cooperation with the Office for the Protection of Personal Data. Authorities should be fined up to a maximum of 10 million CZK for violating privacy rules, as proposed by the Interior Ministry. The fine for violating the ban on the disclosure of personal data should also remain at a maximum of 5 million CZK. The EU Data Protection Directive (GDPR), that the draft law is based on, allowed penalties of up to € 20 million (about 540 million CZK). This should apply to the business sector. This is the first draft of the law and its final formulation is still open. Read more details in a summary by Deloitte Legal. 

Earlier in summer, the Senate returned draft law that simplifies environmental impact assessment (EIA) to the Chamber of Deputies and suggested it should be better aligned with the recently approved amendment to the Construction Act. The amendment, among other things, limits the number of intentions that will be subject to assessment. The Chamber adopted the Senate version of the bill and the new law was signed by the President.

In the light of the Government decision to increase the minimum wage level, state contribution to employers for the salaries of handicapped workers will rise from 9,500 CZK to CZK 12,000 per month.

Czech presidential election will be held on 12 and 13 January 2018.


From the sessions of the Senate

The next session of the Senate will be held on 11 October.

At its session on 16 August, the Senate passed draft amendment to the Act on International Cooperation in Tax Administration. Multinational companies will have to report on their financial situation in the countries where they operate. Their reports will have to contain the information necessary to assess whether they have correctly distributed the tax base between individual states. This is a measure to counter tax evasion.

The Senate approved a draft amendment to the Insolvency Act stipulating that insolvency cases will be assigned to judges by an automatic and random system. Other recent changes to the bankruptcy law summarized by Weinhold Legal.


From the sessions of the Chamber of Deputies

At ist session on 8 September, the Chamber of Deputies passed Government draft law on payment transactions (bill no. 1059), proposing rules for VAT control statment.

Earlier in summer, the Senate returned draft amendment to the Act on Registry of Contracts (bill no. 699) to the Chamber of Deputies. Change proposals of the Senate rejected most of the Chamber changes made to the original version of the bill. Read more details in Czech. On 5 September, the Chamber of Deputies rejected the Senate’s change proposals.

Meanwhile, a replacement - another amendment to the Act on Registry of Contracts (bill no. 1124) was passed and came into effect. Some state-owned enterprises at the national, regional and local level will receive a partial exemption from the mandatory publication of contracts in the Internet Register.(Source: epravo.cz).

The Chamber submitted to the Government draft amendment to the Labor Code (bill no. 1008) written by a group of MPs proposing the introduction of the institute of nursing leave. The material reacts to the ageing of the population and the need to adapt the current law to the challenges employers and employees are facing. The Government expressed disapproval.

Meanwhile, during summer, the Parliament passed the amendment to the Sickness Insurance Act (bill no. 1029)  This law will come into effect on 1 June 2018, granting three months of paid nursery leave to those who take care of seriously ill family members.



Draft amendment to the Act on Banks (bill no. 1061) has been reviewed by the Chamber  committees. The proposal sugests introducing exchange of information on cyber attacks among banks. Change proposals have been submitted.

The second reading of the draft amendment to the Act on the Czech National Bank (bill no. 1009), proposing that the Czech National Bank’s recommendation on mortgage parameters to banks, currently non-binding, become binding, was postponed.

The Chamber of Deputies received draft proposal of Act on eHealth and draft amendment to the Act on Health Services (bill 1043) that deal with issues related to technology use in health care. One of the goals is to establish the National eHealth Centre. The Government expressed disapproval with the draft proposal due to high costs.

At its session on 24 August 2016, the Government approved draft amendment to the Labor Code submitted by the Ministry of Labor and Social Affairs; proposing changes related to senior managerial employees (More details in a summary by Weinhold Legal here (in English),  regulation of homeworking, teleworking, contracts for work performed outside an employment relationship, or prevention from stress at workplace, among others (bill no. 903). The Ministry of Labour and Social Affairs suggested changes (in the areas of paid holiday or telework, for example) to „bring employers and employees closer“ on these issues. The debate over the bill in the Chamber of Deputies continues, the second reading of the bill was postponed on 7 June.

The Senate’s draft amendment to the Labor Code suggests eliminating the institute of "karenční doba" related to coverage of the sickness insurance in the first three days of sickness of employees. (bill no. 744). There has been an ongoing debate within the tripartite (the government, employers and trade unions) on this issue.

The draft amendment to the Act on Social Security Insurance (bill no.1096) suggests differentiation of social security insurance contributions based on the number of children the tax payer takes care of. The contributions by parents of two and more children could decrease from the current 6.5 to 0%.

The Chamber of Deputies has not started to debate the draft Act on State Prosecution yet (bill no.789790). 

On 18 December 2015, draft amendment to the Act on Elections to the Parliament of the Czech Republic was submitted to MPs and the Government. The bill no. 676 proposes rules for correspondence vote. The Government expressed neutral view.The Chamber has not started to debate the bill yet.

Representatives of the Liberecky region submitted draft amendment to the Act on Online Sales Registration (EET, bill no. 846) to the Chamber of Deputies and the Government. The bill suggests that EET could apply only to VAT payers. Another proposal bill no.792 by a group of MPs suggests excluding small entrepreneurs, non-VAT payers. Another proposal, bill no. 867, suggests exemptions for farmers selling their home-grown products at farmers markets. Another bill proposing EET act amendment  No debate of MPs over the bills have taken place so far. At its session on 24 July, the Government rejected a proposal by KDU-CSL (Christian Democrats) and STAN (Mayors and Independent) parties to postpone by 9 months the implementation of the last two phases of EET (phase 3 to start in March, phase 4 in June 2018).


From the sessions of the Government

At its session on 21 August, the Government decided to raise the minimum wage level.

The Government debated the Analysis of shared economy and digital platforms on 4 September.

On 18 September, the government passed the Concept of Family Policy drafted by the Ministry of Labor, suggesting housing loans, free of charge nursery schools and kindergartens, or higher maternity, parental and childbirth allowances, among other measures. Christian Democrats rejected the proposal, They say the proposal contradicts the coalition agreement. (Source: epravo.cz)

The Government approved material intent of the new Consumer Protection Act drafted by the Ministry of Industry and Trade and the Ministry of Justice.

Also, the Government decided that the Delta program to support applied research and international cooperation will be extended by two years. Funds can be tapped until 2021, totaling 720 million CZK.

At its session on 25 September, the Government passed the 2018 state budget and the Concept of BIM (building information modeling) implementation in the Czech Republic, i.e. Construction 4.0.

Members of the American Chamber of Commerce in the Czech Republic