CORONAVIRUS: Legal implications for businesses in the Czech Republic

At its meeting held on 28 April 2020, the Chamber of Deputies decided to extend the state of emergency until 17 May 2020.

On 28 April 2020, the Constitutional Court issued two plenary resolutions rejecting a constitutional complaint against a government resolution on declaring a state of emergency, a government resolution on the adoption of a crisis measure and certain extraordinary measures with file no. stamp Pl. ÚS 8/20, and the proposal of a member of the Prague 4 city council directed against the government resolution on the adoption of a crisis measure (122/2020 Coll.), File No. Pl. ÚS 7/2020.

After its meeting on Monday, April 27, the government announced that, in addition to the self-employed, it also intends to support shareholder/members and executives of some limited liability companies. It also announced the approval of its intention to defer employers' payment of social security contributions for employees and the extension of the Antivirus programme.

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.

On 23 April 2020, the Municipal Court in Prague issued a judgment upholding the petition for annulment of certain measures of the Ministry of Health issued in connection with the COVID-19 pandemic. With effect from 27 April 2020, the Court annulled two extraordinary measures of the Ministry of Health of 17 April 2020 and 26 March 2020 on the restriction of retail sales and two extraordinary measures of the Ministry of Health of 15 April 2020 and 23 3. 2020 on the restriction of free movement of persons ("Extraordinary Measures"). The court found that by issuing these Extraordinary Measures, the Ministry of Health exceeded its competence, respectively did not have sufficient material scope to issue them, so they are illegal, which the government immediately corrected and at its meeting on 23 April 2020 "overturned" the repealed measures into the form of crisis measures, in which it proceeded to the announced relaxing of the measures.

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?

As of April 1, 2020, self-employed persons (“self-employed persons”) can file applications for so-called carer allowance benefits at the Trade Licensing Office in the amount of CZK 424 per day. However, it is not a special social benefit, as initially envisaged, but a State aid in the form of a grant with a stricter regime. Below is a brief overview of the conditions for obtaining this form of assistance.

On 14 April 2020, the Act on Compensation Bonus for self-employed persons, the so-called Twenty-five, was published in the Collection of Laws, which aims to support self-employed persons whose business has been negatively affected in connection with the spread of infection by coronavirus.

On 20 April 2020, the Government approved the amendment of the Compensation Bonus Act, which was published in the Collection of Laws on 14 April 2020 and, with effect from 15 April 2020, introduced another instrument of support for self-employed persons whose business was negatively affected in connection with coronavirus. This extends the period for which the self-employed will be able to claim a bonus. This article sets out for whom the support is designated, what form it will take and what you need to do to obtain it. Applications for bonuses for the period from 12 March to 30 April can be submitted by the self-employed already from 10 April 2020. It is important that if self employed persons are interested in extending the compensation bonus support for the additional time period they will have to submit a new application.

The Compensation Bonus Act was published in the Collection of Laws on April 14, 2020, which provides another support tool for self-employed persons whose business has been negatively impacted by coronavirus spread. Based on a number of comments, the original government proposal from the Ministry of Finance has been revised to expand the range of potential applicants. This article sets forth for whom the support is targeted, what form it will take and how to apply for it. Although the law came into force on 15 April 2020,  since Friday 10 April entrepreneurs can submit relevant applications.

The Ministry of Finance proposes the abolition of a 4% real estate acquisition tax. The proposal will be discussed on Friday 17 April by the Coalition Council of the Government and the National Economic Council of the Government (NECG).

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.

The government approved the wording of a legislative bill on certain measures to mitigate the effects of the SARS-CoV-2 coronavirus epidemic on lessees of business premises. The proposal will be discussed at the 44th session of the Chamber of Deputies of the Parliament of the Czech Republic, which will be held on 7 April 2020.