General Jurisdiction Information:
The Czech Republic is a state in Central Europe. It boasts a very strategic geographical location, bordering Poland in the north, Germany in the west and north-west, Austria in the south and Slovakia in the east. The country has been a NATO member since March 1999 and joined the European Union on 1st May 2004. The Czech Republic is a member of the Schengen Area, the Organisation for Economic Cooperation and Development and the World Trade Organisation.
Development of the country’s economy is supported by the manufacture and distribution of hi-tech products whilst tourism accounts for around 10% of the local budget.
The Czech Republic’s population is around 10,500,000 and the capital city is Prague.
The official language is Czech and the official currency is the Czech Koruna (CZK).
The Czech Republic is not an offshore zone but its laws provide for flexible legal mechanisms for corporate and tax planning. The country enjoys an immaculate reputation and the potential for business operations in Europe.
In 2014, with a view to providing favourable business development conditions and an attractive investment climate, the Czech Republic passed the new Business Organisations and Companies (Business Companies) Law (Zakon 90/2012 Sb) and the new Civil Code. Because of these laws and regulations and the business practises of foreign investors in the Czech Republic, the most in-demand legal forms of companies are as follows:
- limited liability companies (s.r.o.);
- public companies limited by shares (A.S.);
- European companies limited by shares, (S.E.: Societas Europaea), which are similar to companies limited by shares established within the EEC.
The European company limited by shares, a new legal form of company with its status regulated at the European level, was introduced by The Czech Republic in 2004 (simultaneously with the EU). At present, business administration through a European SE company is one of the most advanced, competitive and sought after types of business in the EU. Unlike the international company limited by shares, the European S.E. company enjoys the benefits of free foreign business operations and refunding of VAT.
An SE company offers convenience and efficiency, enjoys wide respectability and can provide a good image for the whole holding structure. Along with other numerous benefits, an SE has a unique feature: free re-domiciliation of the company’s registered office within the EU.
On 1st January 2014 a new law was passed to make companies incorporated in the Czech Republic undertake re-registration by 30th June 2014.