29th November 2016

Czech Legislation Update November 2016

On 3 October, the text of the Paris Agreement and background information by the Prime Minister was submitted to the Czech Parliament. The Chamber of Deputies should vote on the Agreement at its session starting on 29 November.

From the sessions of the Senate
At its session on 19 October, Senate, the Upper Chamber of the Czech Parliament, returned back draft amendment to the Act on the Conflict of Interest with change proposal. According to the bill, companies owned by a member of the government won’t be eligible to participate in public tenders, or profit from investment incentives, for example. MPs approved change proposal that bans members of the government from owning a television/ radio broadcasting company or print media (as is the case of the current Czech Finance Minister Andrej Babiš; the bill was dubbed Lex Babiš). The Chamber of Deputies passed the bill on 29 November. .Also, a group of MPs submitted another amendment to the Act on the Conflict of Interest, bill no. 524.

From the sessions of the Chamber of Deputies
The Chamber of Deputies of the Parliament of the Czech Republic approved on November 9, 2016, in the third reading the MP draft of the amendment to the Act on Business Corporations, stipulating the representation of employees in the managements of corporations with 500+ employees. The approved norm stipulates that two thirds of supervisory board members will be elected by the general meeting and one third by the firm’s employees, ČIANEWS wrote.

Meanwhile, the Constitutional Court decided that functions may be performed concurrently. Concurrence of functions is a situation in which a member of a company’s statutory body is also bound to this company under an employment contract, generally in an executive role, Weinhold Legal explain

Also, The Chamber of Deputies debated a bill that aims at reintroducing into the Civil Code the pre-emptive right of co-owners to transferred shares in real estate, Dvořák Hager Partners write.

The Government proposed a bill (no. 873) summarizing changes to tax laws as of 1 January 2017. The bill should have its second reading during a session of the Chamber of Deputies starting on 29 November. Also, the Chamber passed a bill proposing reduced VAT for newspapers, heading now to the Senate. Details here (in English).

The draft amendment to the Act on Employment and Labor Code, bill no. 964  is based on EU legislation and aims at better identification of real reasons behind posting or assigning employees. It also aims at anchoring the responsibility on the part of the receiver of the transnationally provided service. The bill should improve cooperation of authorities among EU member states in the area of posted workers, too. It could be debated at the session of the Chamber of Deputies starting on 29 November. Read more details.

The Chamber of Deputies will debate amendment to the Act on the support of R&D and innovations, bill no 960.  The aim of the proposal is to define “eligible costs” and ”project of R&D and innovations” more clearly to better meet the purpose of the act.

The draft amendment to the Construction Act (bill no. 927) had its first reading in the Chamber of Deputies on 26 October. The bill will be reviewed by the Chamber Committees. Position of the Confederation of Industry and Trade of the Czech Republic is available here.

Draft amendment to the Act on Insolvency (bill no. 785) had its second reading on 18 October. Change proposals were submitted. The third reading should be held at the Chamber session starting on 29  November. Read more (in Czech). The Czech Association of Creditors criticizes the bill. More details and an update. Read also an article on Ministerial report on new forms of insolvency fraud by ceska-justice.cz. 

A group of MPs is proposing exemptions from the Act on the Registry of Contracts (bill no. 699). The bill had its second reading on 18 October; change proposals were submitted and the third reading could be held at the Chamber session starting on 29 November. The material proposes exemption for state-owned Budějovický Budvar n.p. from the obligation to disclose (both sales and purchase) contracts.

The Chamber of Deputies will debate the draft Act on State Prosecution (bill no.789790). The proposal should have its first reading in the Chamber of Deputies at its session starting on 29 November.

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 amendment.  These proposals could have their first reading at the Chamber session starting on 29 November.

At its session on 24 August, 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. The bill no. 903 should have its second reading in the Chamber of Deputies at its session starting on 29 November. 

On 24 August, the Government passed draft amendment to the Act on Employment. The purpose of the amendment is to regulate temporary employment and job agencies.The bill no. 911 should have its first reading in the Chamber of Deputies at its session starting on 29 November.

At its session on 18 May, the Government approved draft amendment to the Act on Sickness Insurance (bill no. 821) allowing for paid paternity leave, among others. The bill should have its second reading at the session of the Chamber of Deputies starting on 29 November.

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. The the bill no. 744 should have its first reading at the session of the Chamber starting on 29 November.

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 of Deputies could debate the bill at its session starting on 29 November.

On 18 October, the Government submitted to the Chamber of Deputies draft Act on measures to reduce the cost of deploying high-speed electronic communications networks (bill no. 936). Construction works costs account for the highest (up to 80%) share of the total costs, the material says. The aim of the bill is to introduce rules, a minimum standard, from the very first phase of the process to minimize inefficiencies of electronic communications networks deployment. These rules could accelerate the process of e-government implementation. The proposal could have its first reading in the Chamber of Deputies at its session starting on 29 November. 

From the sessions of the Government
On 28 November, the Government passed draft amendment to the Act on the Residence of Foreigners in the Czech Republic. The material, among others, proposes the introduction of the so-called "foreign investor card", a special type of a long-term residence permit and improved rules for employees-foreigners assigned within a corporation, for example. Read more in an article by Radio Praha.  

At its session on 23 November, the Government approved draft Act on Compensation of Damage incurred by breach of competition rules. 

Also, the Government passed draft amendment to the Act on Cybersecurity and the Act on Freedom of Access to Information and approved measures to increase capacity of official authorities in the field of cybersecurity. More details in an article by lupa.cz (in Czech).

The Government passed National eHealth Strategy 2016-2020, including central database of health data. Details by the Health Ministry in Czech here

The Government passed Updated Export Strategy of the Czech Republic for the period 2012-2020. A network of diplomats in specific areas such as agriculture, food industry and related sectors, technologies as well as experts in R&D and innovation will be active within the currently existing territorial activities of Czech authorities promoting export. Details in Czech here.

Also, the Government greenlighted Strategic Framework for National Cloud Computing – eGovernment Cloud. The Government plans to have their own data centers by 2022. Read more (in Czech). 

Members of the American Chamber of Commerce in the Czech Republic