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Welcome changes in operation of small trades

Since 1 July 2008, on the basis of Act No. 130/2008, Coll., amending the Trade Licensing Act, requirements for commencement of business activities and reduction of the overall administrative burden for tradesmen are significantly simplified.

The new regulation introduces reduced requirements for a clean criminal record, since criminal acts committed by negligence have been removed. The loss of a clean criminal record is now represented only by a sentence for intentional criminal deeds. The existing requirements for previous practice and professional competence have been very significantly limited.

In particular, the limiting of reporting duties should contribute to eliminating excessive administration. Business persons are no longer obliged to report changes in data which are accessible in public registers and the Trade Licensing Office may obtain itself. Further it is newly possible to perform necessary acts or filings at any Trade Licensing Office regardless of the domicile or registered office of the business person.

The replacement of the existing documents to prove trade authorization, i.e. trade certificates and license deeds by an extract from the Trade Licensing Register, is a fundamental change. The extract is provided only to the business person after the trade authorization arose or in the event of a change of data, and further upon the business person’s or a third party’s request – in such an event certain personal data are not stated in the extract (such as birth registration numbers and sanctions imposed on the business person). The extract is provided as a document or in e-form. In connection with this change, the existing duty to have the trade certificate or license deed available in every establishment for inspection is cancelled. Pursuant to transitory provisions of the amendment, the existing trade authorizations are preserved. The business person proves his or her identity by the existing trade authorization until the first extract is provided to the business person; this comes into consideration based upon a notification of a change or upon the business person’s request.

Another important change that should make the commencement of business activities become easier is the introduction of the sole unregulated trade, including individual fields of activities (commercial, production or services) listed in Annex 4 to the Trade Licensing Act. For announcement of an unregulated trade, the business person states the relevant fields of activities that he or she plans to carry out in compliance with their names pursuant to the above annex.

Sanctions have also undergone conceptual changes. Administrative violations are newly broken down by offences that may be committed by individuals not engaged in business, and administrative violations of legal entities and individuals engaged in business. The reasons are for exclusion of liability and deadlines for termination of penalization. The amounts of penalties have not significantly changed.

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