2nd February 2012

From the sessions of the Chamber of Deputies (December 22, 2011 – February 2, 2012)

The Senate, the Upper Chamber of the Czech Parliament, returned the draft Amendment to the Public Procurement Act to the Chamber of Deputies and submitted three changing proposals. On January 31, the Chamber of Deputies rejected the Senate’s changing proposals related to ownership transparency and passed the reform version approved earlier in November 2011. Among the most significant improvements are the obligation to disclose contracts, real costs/final prices, and all documents and information related to the tendering process (excl. given exemptions), for example. The tendering agency will be obliged to justify each procurement and the scope of procurements that have to be processed according to the Public Procurement Act will be extended. The amendment also introduces rules related to ownership structure of tender winners and subcontractors. The issue of ownership transparency should be dealt with in a separate act (Act on Transparency of Corporations), currently being drafted by the Ministry of Justice. Click here for details.


The Chamber of Deputies greenlighted the draft Act on Supported Renewable Energy Sources, including the changing proposals of the Senate on January 31. It is claimed that the approved new (e.g. solar tax) measures will generate savings worth Kc50bil by 2020. The new bill should replace the existing Act on Support of Energy Production from Renewable Sources. A concern about this new bill has been that it could have an impact on all existing contracts for the purchase, manufacture and delivery of renewable energy as it includes provisions for retroactivity (i.e. retroactive change of conditions for businesses operating in the renewable energy sector). The act newly supports the production of biomethane, not wide-spread in the Czech Republic, and includes new provisions on doing away with solar panels. Click here for details.


A draft amendment to the Act on Investment Incentives drafted by the Ministry of Industry and Trade is in the first reading in the Chamber of Deputies. The draft act includes changes in the current system of incentives for the manufacturing sector and introduces incentives in the areas of technology centers and centers of strategic services. Investors could be granted income tax / corporate tax breaks for ten years instead of the current five. Strategic investments could receive direct capital subsidy from the state budget. The Chamber’s Economic Committee discussed the bill at its session on January 22. Its members will submit their changing proposals by February 15 and these will be debated at the Commitee session on February 29. Click here for details.


The new Civil Code draft was approved by the Chamber of Deputies and is currently being debated in the Senate. The aim of the new Civil Code is to unify a rather fragmented civil law (new law will replace current Civil Code, part of the Commercial Code, part of the Labor Code) and make it more user-friendly. Major changes are expected in legal terminology; new legal instruments will be introduced; the freedom of contract is stressed. The adoption of a new Civil Code means new amendments to a wide range of acts, including the Labor Code or tax legislation. Click here for details.


At its session starting on January 25, the Senate approved the draft of the new Act on Corporations which is now heading to the President. The new Act on Corporations should replace the current regulation of companies / corporations under the Czech Commercial Code and better define the process of their establishment and operations. No major changes of regulation are expected, although there are exceptions: corporate governance (including liability / responsibility of statutory bodies), regulation of holdings and capital companies (limited liability companies and joint stock companies). Click here for details.


The draft of the new Act on Mediation had its second reading at the session of the Chamber of Deputies starting on January 31. The draft act introduces rules for the out-of-court way of dispute settling. Click here for details.

Members of the American Chamber of Commerce in the Czech Republic