CORONAVIRUS: Legal implications for businesses in the Czech Republic

Category A and B have now been extended until the end of August 2020 and the government has approved a new form of support – Category C!

Category B has been extended until the end of August 2020 and the government has approved a new form of support – Category C!

At its meeting on 18 May 2020, the Government approved by Resolution No. 553 the Covid III guarantee program for self-employed persons and companies employing up to 500 employees. Immediately afterwards, the websites of Českomoravská záruční a rozvojová banka, a.s. ("ČMZRB") published the conditions of the program. Entrepreneurs can already start loan negotiations with a commercial bank involved in the program. According to the experience of previous Covid programs, it is necessary to act quickly.

The government has started to announce the dismantling of certain Covid19 measures and from Monday, April 27, 2020, it now allows business trips for foreigners to the Czech Republic, in respect of which business people were mounting pressure therefore. However, it set out a number of conditions and rules, which are further modified.

The original Government Crisis Measure No. 443 was repealed on 1 May 2020 and replaced by Government Crisis Measure No. 495. However, this crisis measure is valid only until 10 May 2020, as it will be replaced by Government Crisis Measure No. 511 with effect from 11 May 2020. This article takes into account measures effective until 10.5.2020, with the proviso that changes effective from 11.5.2020 are pointed out in italics.

It might seem that in the time of the "coronavirus", everything revolves around face masks, disinfection or restriction of operation of various production facilities, and energy is talked about only in connection with the need to keep the elements of critical energy infrastructure running. However, this is not the case, as evidenced by yesterday's government meeting, after which the press conference mysteriously stated that the government "adopted a proposal to introduce measures to ensure the adequacy of support that meet the Czech Republic's commitments, as set out in European Commission decisions.”  So what did the government actually adopt?

The government has started the announce the dismantling of certain Covid19 measures and from Monday, April 27, 2020, it now allows business trips for foreigners to the Czech Republic, in respect of which  entrepreneurs have been repeatedly demanding. However, it set a number of conditions and rules. 

The Parliament of the Czech Republic approved a law on certain measures to mitigate the effects of the coronavirus epidemic known as SARS-CoV-2 on the tourism sector (the “Act”). The Act, for which the designation "Lex Voucher" was used, was promulgated on 24 April 2020 in the Collection of Laws in Volume 69 under No. 185/2020 Coll.

The new COVID Prague program focused on business activities in the Capital City of Prague followed the fate of its predecessors COVID I and COVID II. This means that the available funds were exhausted on the same day as the receipt of applications, which thus ends. The COVID I and COVID II programs are also exhausted. Entrepreneurs thus have no choice but to wait for the announcement of the conditions of the COVID III program. What should be its parameters?

On 6 April 2020, the Government approved a bill on certain measures to mitigate the impact of the SARS-CoV-2 coronavirus epidemic on the tourism sector. On 8 April 2020, the bill will be discussed by the Chamber of Deputies Committee for Public Administration and Regional Development and subsequently by the Chamber of Deputies.

VAT payers, who have monthly obligations, may no longer be oriented in the flood of newly adopted tax measures to help taxpayers to overcome the current situation caused by the spread of the coronavirus. For this reason, we provide a brief overview of the tax measures specifically related to VAT and add some important remarks that should be kept in mind.

When and how can contact with a counterparty be avoided and the document signed electronically? Is it possible to consider the electronic way of signing relevant for the eligibility of such a conclusion of a contract and how does Czech legislation and case-law treat this?

Can it take place? And can it be convened? Do crisis measures contain an exception for meetings of the statutory organs of the company (e.g. board meetings)? What are the parameters of due and correct business conduct for a manager during a state of emergency?