Dear Clients and Business Friends,
In order to be a reliable partner for you in the long term, to help you in difficult times or under any circumstances, we are always thinking ahead, looking for new challenges and preparing for them, and we want to prepare you for them as well. In this new issue of the H&P Magazine, available both online and in PDF format, we therefore offer a number of articles, data and analyses, commentaries and interviews on current topics and trends in the world of business and law that are now relevant to your business.
A company that wants to be successful in the long term should always be one step ahead and invest in development and innovation. Today, global technology corporations commonly acquire innovations by investing in start-ups, and this proven approach can also work well in the Czech or Slovak environment. In the magazine, we explain how such a corporate investment in a start-up works in practice, and what benefits it can have for the company.
Credibility, prestige, and new capital – these are the biggest benefits of offering company shares on the stock exchange. In this article, our capital market experts give you practical advice on how to make a successful IPO. We are seeing an increasingly important female element in business. What is the cause and what socio-economic changes are involved? We offer a summary of our unique NextŽeny study on the phenomenon of wealth transfer to women. We also add a range of news from the world of taxes, trade, e-commerce and other areas, and you will also learn about the legal pitfalls of a relationship with a foreign partner, or what obligations management has when a company faces financial difficulties.
Thanks to our universality and specialisation in all areas of law, our network of contacts and proactive approach, we can effectively help you deal with any serious problems or crisis situations that may threaten your reputation, security or economic stability.
In these cases, we offer high added-value legal and tax services complemented by our exceptional know-how in the areas of PR and security. No other law firm on the market offers such a range of services that effectively avert fatal damage or negative impacts on clients and their companies. Moreover, we are constantly striving to further push the boundaries of our potential.
Thank you for your trust, we wish you useful and inspiring reading, and we look forward to further cooperation.
We believe that we will continue to be with you, as always, connected through success.
Authors: František Neuwirth, Denisa Fuchsová
In December 2022 and January 2023, new legislation on medical devices and in vitro diagnostic medical devices (jointly “medical devices”) came into force:
We provide an overview of the most important changes in this post.
Amendment to Act No. 40/1995 Sb. on Advertising Regulation, as amended, relaxes some of the requirements for advertising of medical devices that have proven problematic in practice.
Catalogues and price lists
The amendment provides for an exemption from the application of the Act on Advertising Regulation for sales catalogues and price lists, which have not been previously allowed to contain a description of the characteristics of medical devices. It is now explicitly allowed for catalogues and price lists to contain a basic description of the device necessary for its identification.
If it is just such a basic description, then the catalogue or price list will not be considered as advertisement. Pursuant to the explanatory memorandum [1], this clarification was made in order to allow indicating the basic parameters of the medical device in the aforementioned materials, which are necessary for correct identification and thus the subsequent ordering of the correct medical device. This change therefore responds to practical needs. Indeed, it has become clear that in many cases the mere name of a medical device is not of itself sufficient for its unambiguous identification.
Recipients of advertising of medical devices
The amendment allows advertising of medical devices to target not only “professionals” in the narrow sense of the word (i.e. persons authorised to prescribe or dispense), but also employees of healthcare providers whom the amendment places at an equal level with professionals. This means that medical devices, which until now could only be advertised to professionals, can now also be advertised to employees of healthcare providers who do not fall under the statutory definition of professional, such as laboratory technicians.
The explanatory memorandum specifies that this addition was made “in view of the wide variety of medical devices and the individuals who use them in the provision of health services, where the use itself is not only the responsibility of doctors, who were the only ones falling under the previously stated definition of professional, but also involves other professional staff which includes, for example, nurses, biomedical engineers and purchasing department staff”. At the same time, however, the prohibition on gifts is extended to employees of healthcare providers.
Mandatory information in advertising
The amendment also modifies the scope of mandatory information in advertisements targeted at lay persons, the so-called “legal line”. Instead of stating the “intended purpose” in the advertisement, it will now be sufficient to state the substance of the intended purpose. According to the explanatory memorandum “this clarification was made in view of the fact that the full intended purpose of use stated in the instructions for use may be so extensive that if the interpretation that the full intended purpose must be stated were to continue to apply, it would render the advertisement technically impracticable”.
In relation to mandatory information in advertising targeting professionals, the amendment departs from the obligation to include in the advertisement the basic information contained in the instructions for use, the so-called abridgement.
In practice, this obligation caused significant problems, as there was no precise stipulation anywhere as to what information was considered basic, and the administrative authorities left this assessment to the advertisers. Especially with more complex instruments, where instructions for use often consisted of hundreds of pages, it was not possible to “condense” the instructions into abridged information.
However, an advertisement still must contain sufficient, demonstrable and objective data to enable the professionals to form their own opinion on the clinical benefit of the device in question, and now also on its safety and effectiveness.
The new Act No. 375/2022 Sb. on Medical Devices and In Vitro Diagnostic Medical Devices (the “Medical Devices Act”) was adopted in furtherance of Regulation (EU) 2017/746 on in vitro diagnostic medical devices (“IVDR”). This brings about unification of national legislation on medical devices.
Due to the late applicability of the IVDR, national legislation has been split so far – general medical devices were regulated by Act No. 89/2021 Sb. on Medical Devices (“Act 89/2021”), while in vitro diagnostic medical devices were regulated by Act No. 268/2014 Sb. on In Vitro Diagnostic Medical Devices (“Act 268/2014”). Both of these Acts have been repealed and replaced by the new Medical Devices Act.
As stated in the explanatory memorandum [2], the Medical Devices Act largely adopts the existing regulation contained in Act 89/2021, extending it to in vitro diagnostic medical devices. However, upon closer examination of the new Medical Devices Act, it is clear that the legislator has also made several partial substantive changes, which are discussed below.
Borderline products: new ex officio proceedings for annulment of a decision
The Medical Devices Act has taken over from Act 89/2021 the provisions regarding the proceedings for a decision on a so-called borderline product, i.e. the proceedings to determine whether or not a product falls within the scope of Regulation (EU) 2017/745 of the European Parliament and of the Council on medical devices (“MDR”), and henceforward also within the scope of the IVDR. However, under the MDR and IVDR, the European Commission too can decide on the nature of a product or group of products by means of implementing acts.
In practice, this could result in the previously issued decision of the State Institute for Drug Control (the “Institute”) coming into conflict with a decision of the European Commission. Previously, this situation had not been explicitly addressed in the legislation. With the adoption of the new legislation, however, the obligation of the Institute to annul the previously issued decision in proceedings initiated ex officio is clearly established. Given that the Medical Devices Act expressly stipulates that proceedings are initiated ex officio, proceedings cannot be initiated at the request of the person concerned. Those persons will thus only be able to submit motions to the Institute to initiate the proceedings.
Registration of medical devices
As regards the registration of medical devices, the MDR or IVDR, respectively, foresees that this will take place exclusively at European level, with medical devices being registered only by manufacturers in the European Database on Medical Devices (EUDAMED).
However, the Medical Devices Act continues to impose a limited reporting duty on distributors in the Czech Republic in relation to medical devices distributed by them – distributors are obliged to report the primary identifier of the device model (Basic UDI-DI) and the intended purpose of the medical device; if these data are not available in EUDAMED, the distributor will report the trade name and the name of the generic device group.
This reporting duty is to be fulfilled by distributors through the Medical Device Information System, which has not been established yet. Until its establishment, medical devices will be reported through the existing Registry of Medical Devices.
Prohibition of supply of a medical device to a lay person
The Medical Devices Act also contains an explicit prohibition of the supply of a medical device whose dispensing is mandatorily linked to the so-called safety pass, and of a diagnostic medical device (with the exception of a diagnostic medical device designated by the manufacturer for self-testing and a diagnostic medical device of risk class A) to a lay person. Pursuant to Article 2(38) of the MDR and Article 2(31) of the IVDR, respectively, a lay person is “an individual who does not have formal education in a relevant field of healthcare or medical discipline”.
Changes to instruction
With regard to the area of instruction, the explanatory memorandum to the Medical Devices Act states that the existing provisions contained in Act 89/2021 are merely taken over and modified so as to also cover in vitro diagnostic medical devices. However, compared to the wording of Act 89/2021, there is at least one change that may have an impact on practice, namely omitting the authorised representative from the list of persons who can perform instruction or authorise training centres to train instructors.
Therefore, it is now the case that if an authorised representative were to perform instruction, he or she will need to have the manufacturer’s authorisation. Similarly, the training centre must now be authorised directly by the manufacturer to train instructors – authorisation by an authorised representative will no longer be sufficient.
This may have practical implications, especially in view of the fact that manufacturers are often foreign entities which are not familiar with the specifics of the Czech law and automatically consider the authorised representative to be a person who is entitled to fulfil the manufacturer’s statutory obligations in the full scope.
Retention obligation for spare part distributors
The Medical Devices Act contains a new retention obligation for persons who make available spare parts of medical devices, for a period of 10 years from the date on which they supplied the spare part. The law somewhat inaccurately states that the retention obligation applies to “supporting evidence”, while it is not clear from the wording of the Medical Devices Act itself what is meant by supporting evidence. However, in conjunction with the MDR and IVDR, respectively, it is obvious that the reference is meant to be to supporting evidence demonstrating that it was ensured that the component in question did not adversely affect the safety and performance of the medical device.
The Ministry of Health has issued a new price regulation No. 1/2023/OLZP on the regulation of prices of medical devices and diagnostic medical devices, effective from 1 January 2023. Below is a list of the main changes compared to the previous price regulation (No. 1/2019/CAU of 2019):
Maximum year-on-year increase in the price of the originator: In 2023, the originator’s price can be increased by a maximum of 8% compared to the highest price applied by the originator in 2022. In 2022, it was only 3%.
Narrowing down the groups of medical devices for which the market is not expected to be threatened in terms of competition: The previous price regulation established a presumption that for the listed groups of medical devices there would, “as a rule”, be no threat to the market in terms of competition.
The new price regulation has removed the following from the applicability of that presumption:
(i) reimbursement groups listed in Annex 3 to the Public Health Insurance Act, which include at least 4 substitutable medical devices from 4 different notifiers; and
(ii) groups of separately billed medical material or directly consumed medical material that include at least 4 substitutable separately billed medical materials or directly consumed medical materials from 4 different originators.
This has left only one group of medical devices within the presumption, namely the group of substitutable devices created under Section 39u of the Public Health Insurance Act.
It is important to mention in this context that the presumption has an impact in terms of deregulation of the originator price – indeed, the originator price (its maximum year-on-year increase) is not regulated for those groups of medical devices where no negative impact on competition is expected to occur.
However, it is still merely a presumption, and one that is qualified by the phrase “as a rule”, so it is questionable whether it can be safely relied upon in practice.
Just for completeness, we would like to point out that both the previous and the new price regulations assume that the Ministry of Health will issue a price decision setting out a list of medical devices for which the originator price is deregulated. However, no such price decision has been in place since 2019. Price decision 2/13-FAR was in effect until 2019, which explicitly deregulated the manufacturer’s price for, among others, all separately billed material.
It remains the case that price regulation only applies to reimbursed medical devices, whether they are covered by a voucher or as separately billed material. However, medical devices reimbursed as directly consumed medical material (needles, syringes, gloves, etc.) have been excluded from the category of regulated goods.
[1] Explanatory memorandum available here.
[2] Explanatory memorandum available here.
Authors: Robert Nešpůrek, Pavel Amler, Tomáš Chmelka
For the first time since 1985, the European Commission (EC) has decided to change legislation concerning liability for defective products. The primary objective of the related Directive is to respond to the rapid development of new technologies, to significantly extend the range of products offered on the internal market and, in connection with this, to maintain a balance between the obligations of producers and consumers. The Directive is currently in the proposal stage and may therefore be subject to further changes.
Most significant changes
The new Directive changes the definition of a product to include software (whether or not it is integrated into a tangible product), and the developer or producer of the software should be regarded as the producer within the meaning of the Directive. The new Directive does provide exceptions to this rule, but these apply only to free software and open-source software developed or supplied outside the business activities.
While the general 10-year time limit for making a claim for compensation for damage caused by a product defect remains unchanged in the new Directive, the proposal foresees the introduction of an extended time limit of 15 years in cases of latent personal injury, especially in cases where the symptoms of a personal injury emerge later. Similarly, the EC is trying to accommodate consumers by removing the current minimum threshold of EUR 500 for making a claim.
However, the change with potentially the most significant impact is the introduction of an obligation for a potential wrongdoer to disclose relevant evidence in court. In practice, this means that the producer against whom a claim for compensation for damage is made will have to disclose information about the manufacture of the product and its operation to the court on a mandatory basis, after the plaintiff has submitted relevant evidence and facts. This change is considered by the new Directive as one of the presumptions of product defectiveness.
The second presumption of product defectiveness presupposes a causal link between the defect in the product and the damage caused if it is proven that the product is defective and the nature of the defect corresponds to the type of damage caused.
The new Directive also introduces a so-called presumption of defectiveness or causality. In other words, if the court finds that the technical or scientific complexity of the product in question is too high, then it is sufficient for the injured party to demonstrate that the product contributed to the damage and it is likely that the product was defective or that its defectiveness is a likely cause of the damage (or both).
Special regime for artificial intelligence
The EC has also submitted the proposal for a Directive on liability for damage caused by artificial intelligence (currently only in Czech and Estonian) as part of the planned legislative package.
The Directive largely follows the Proposal for a Regulation on artificial intelligence (AI) published in 2021. To a large extent, the Directive takes terminology from and refers to this Proposal.
Two major areas of this Directive concern primarily the facilitation of the position of the injured parties, by reducing their burden of proof and facilitating access to evidence during court proceedings. This Directive creates a presumption of culpable breach of liability where the wrongdoer’s AI system fails to comply with the AI Regulation – it is a major simplification of the injured party’s burden of proof.
The last significant change is the introduction of an information obligation for companies developing high-risk AI systems as defined in the Proposal for the AI Regulation (i.e., those that have an impact on security or fundamental rights). These companies will now have an obligation to the courts to disclose relevant technical documentation relating to the system. Failure to do so will give rise to a presumption of failure to exercise due care against them.
Although these are currently only proposals for new European legislation, from our viewpoint, they are much more consumer friendly. For this reason, we recommend monitoring this legislative process, as these new regulations may have a significant impact on technology companies engaged in software and artificial intelligence.
On 6 January 2023, an amendment to the Czech Civil Code came into effect, introducing new rules on contracts for the provision of digital content and digital services. Under the amendment, digital content means software, applications, e-books or audio files in any form (e.g., also in smart watches or smart phones) and digital services mean, e.g., video, audio or other file sharing services, digital games or social networks.
Who is affected by the amendment and what are the obligations arising from it?
For the purposes of the amendment, a provider means a person who makes digital content or digital services available – it is not a publication but making them available to the user for his/her own use. This could be, for example, simply making an e-book available via cloud storage or email.
, The new regulation only applies to contracts for which the provider is paid. However, this formulation also includes “payment” by disclosing personal data that the provider further uses for his own purposes (e.g., statistics or advertising). On the other hand, if the provider provides free open-source software and process the data disclosed by the user only to improve his product (e.g., in the context of its security or interoperability), he will not be subject to the amendment.
The Czech Civil Code now establishes the provider’s obligation to provide contractually agreed updates – in the event of defects due to failure to provide updated content, the provider will then fully be liable for defects in the digital content or digital service.
The provider is also obliged to provide updates that are necessary to ensure that the digital content is provided free of defects, both for long-term contracts and for one-off performance. For both types of performance, the provider is also liable for defects, if any.
Customer’s claims
The customer’s right to claim for defects in the digital content or digital service depends on whether the content or service is provided for a certain period of time or on a one-off basis. In the first case, the customer may complain about defects that become apparent for the duration of the contractual relationship. In the latter case, the customer may complain about defects that become apparent within two years of making the content or service available. When a claim is made, the provider bears the burden of proof and must prove that the digital content or service is not defective.
B2B v B2C
In the case of contracts between businesses, it is sufficient to follow the new rules when concluding a contract from the effective date of the amendment, i.e. from 6 January 2023. For contracts between businesses and consumers, the new legislation is stricter – the new rules will also apply to contracts concluded before the effective date of the amendment. In a relationship between businesses, it is of course possible to exclude the application of certain provisions by a contract. In contrast, in the relationship between the business and the consumer, such exclusion is not possible if it is intended to weaken the position of the consumer.
Traditionally, the consumer also has extended options to withdraw from the contract. The law expressly provides for a 14-day period from the conclusion of the contract, as well as allowing the consumer to withdraw due to defects in the digital content or digital services, or due to a breach of the contract by the provider.
The amendment to the Czech Civil Code entails significant changes to the supply of digital content and digital services and therefore we cannot but recommend a thorough review of purchasing processes, business terms and conditions, complaints policies and other relevant documentation, especially in relation to consumers, to ensure that they comply with the new regulation.
The Council of the European Union under the Czech Presidency approved in November 2022 the final text of the Directive on measures for a high common level of cybersecurity across the Union, known as the NIS 2 Directive. This Directive builds on the existing NIS Directive 1, significantly broadens the range of obliged entities and removes frequently criticised shortcomings.
Who will be covered by NIS 2?
Until now, the NIS 1 Directive has affected a relatively narrow range of entities in seven sectors and three areas of digital services. Based on the NIS 2 Directive, any entity that meets two conditions simultaneously – it must provide one of the services listed below and at the same time must qualify as a so-called medium-sized or large-sized enterprise within the meaning of Commission Recommendation 2003/361/EC (i.e. an enterprise that employs 50 or more employees or has an annual turnover of at least EUR 10 million or CZK 250 million) – will now be subject to this regulation.
The NIS 2 Directive divides entities into:
What new obligations does NIS 2 introduce?
NIS 2 imposes a number of obligations on the entities concerned, in particular the obligation to adopt appropriate and proportionate technical and organisational measures to manage security risks.
NIS 2 also introduces the responsibility of management bodies for the cybersecurity measures taken and the duty of supervision. In order to acquire sufficient knowledge and skills, members of management bodies are also obliged to attend regular training in cybersecurity.
At the same time, NIS 2 introduces a general reporting obligation for any incident that has a significant impact on the provision of services.
GDPR-style penalties
For companies that fall under the new regulation and fail to implement all technical and security requirements, the NIS 2 Directive entails an incentive in the form of significant penalties. In the event of a security incident and refusal to cooperate with the supervisory authority, these companies may be fined at least EUR 10 million or 2% of their total worldwide annual turnover.
Preparation of Czech legislation
At the same time, a new Czech Cybersecurity Act together with eight implementing decrees is already in the pipeline. The Czech National Cyber and Information Security Agency, which is responsible for the implementation of NIS 2, has launched a public consultation. Suggestions can be sent by 26 February this year. The proposal envisages unification of the existing classification of obliged persons into a single category of “regulated service provider”, for which it introduces two different regimes depending on the size and sector – with higher obligations (these will be regulated in a decree largely copying the current decree on cybersecurity) and lower obligations (for the latter a new decree will be prepared to supplement the existing regulation).
When will NIS 2 come into effect?
The final text of the Directive was published in the Official Journal of the EU on 27 December 2022 and will enter into force on the 20th day after its publication. Subsequently, Member States will have 21 months to implement the Directive in their national legislation, i.e. specifically, implementation must take place by 17 October 2024.
We recommend all companies that could be affected by this new legislation to consider all the risks associated with cybersecurity, read the Directive as soon as possible, and monitor legislative developments in the Czech Republic in the field of cybersecurity.
At the end of last year, the Czech Ministry of Health submitted a long-awaited draft amendment to the Health Services Act (in Czech only), which (among other things) aims to establish a clear legal framework for the provision of telemedicine services. Telemedicine is understood as the provision of health services via information technology remotely, but its legal definition and the conditions under which such services can be provided have so far been lacking in the legislation.
Current status
An amendment to the Czech Health Services Act effective from 1 January 2022 has made it possible to provide consultancy services outside healthcare facilities via remote access. In practice, however, telemedicine can encompass a much broader range of services, such as making detailed records of the patient’s health using digital technologies or making decisions about the patient’s treatment remotely, which cannot be subsumed under consultation services. The current legislation is thus not sufficient for telemedicine.
What does the draft amendment say?
The draft amendment sets out only very general parameters for the conditions under which telemedicine services can be provided (in the words of the draft amendment “only under the conditions provided for by law” and “if the technical requirements for the quality and security of communication are met”). The forthcoming implementing decree should provide more detailed specifications. However, the draft amendment at least provides a definition of telemedicine health services, which it considers to be health services that are provided remotely using telecommunications and information technologies.
According to the current wording of the draft amendment, it will be possible to provide the following services outside of a healthcare facility:
Communication safety and quality
Health service providers are still obliged to have an established health care facility with material and technical equipment. Under the current wording of the draft amendment, this obligation will probably also apply to health service providers providing health services exclusively by remote means. However, it is not clear from the current wording of the draft amendment whether it will still be necessary for the patient to visit the physician’s office at least once (or in which cases).
When providing telemedicine services through information technology, the draft amendment also requires that the safety and quality of communication between the health service provider and the patient be ensured. The requirements for the minimum technical characteristics of the information technology used are to be set out in an implementing decree, which is likely to include, for example, a requirement to use an encrypted communication channel, to ensure proof of the identity of the patient and the health service provider, etc.
The draft amendment, which, in addition to telemedicine, also includes the regulation of the electronic medical record keeping, is currently in the comment procedure and its final wording may still change. However, if the current wording of the draft amendment is approved, it could come into effect as early as July 2023.
Authors: Petra Sochorová, Anna Kubrichtová
Last September we informed you of major changes that the Czech employment law is to undergo as a result of the amendment to the Labour Code and related labour regulations.
The Ministry of Labour and Social Affairs of the Czech Republic dealt with hundreds of comments that were received on the original draft amendment to the Labour Code and submitted a modified draft to the Government at the end of January this year. Below we summarise the main changes brought about by the draft. We suppose that the amendment could come into effect this autumn; some of the proposed changes are scheduled to come into effect from 1 January 2024.
The most significant change in the telework regulation is the deletion of the paragraph on the mandatory elements of the telework agreement. The terms of the agreement may therefore be determined by the parties themselves. In our experience, the agreement should, at a minimum, provide for the agreed place of performance of telework, the manner in which communication between the employee and the employer will take place, how the work will be assigned to the employee and how the work will be supervised, determination of the scope of the work to be performed, and the manner in which working time will be scheduled.
Telework may then only be ordered by the employer, taking into account the mandatory rules and general principles contained in the Labour Code. Under the draft amendment, telework may only be ordered if a measure of a public authority pursuant to another law so stipulates, for a necessary period of time, if the nature of the work to be performed allows so, and on condition that the place of performance of telework is suitable for the performance of work.
However, if telework is ordered, the employer shall not be entitled to unilaterally determine the place of performance of telework but shall be obliged to ask the employee to inform the employer of his/her place of performance of telework.
The notice period for a telework agreement will remain at 15 days, but it will be possible to agree on a different notice period, provided that the length of the notice period is the same for both parties.
With regard to the reimbursement of costs incurred by the employee in connection with the performance of telework, the amendment now provides that the employer shall be obliged to pay employees a lump sum only if this has been agreed in writing or provided for in an internal regulation.
For the period of teleworking for which the employee has been granted this lump sum (i.e. CZK 2.80 per each hour commenced – the starting value of the lump sum will be stipulated by law and further adjusted by decree with regard to the development of the indicators concerned), the employee cannot at the same time be reimbursed for the same types of documented costs.
In the area of electronic delivery of documents, the Ministry was not very keen on further changes, however, the new draft reflects at least some of the reservations raised in the comment procedure.
The stricter delivery regime will apply to the delivery of notices of employment termination, immediate termination, termination within the probationary period and other documents relating to employment termination or legal relationships established under the agreement on performance of work or the agreement on work activity, and the discharge or resignation from a managerial position. Despite numerous comments, both wage and salary statements remain among the important documents.
If a document is delivered by the employee to the employer via an electronic communications network or service, to an electronic address, it will not need to bear a qualified electronic signature.
The employer will only be entitled to deliver a document electronically if the employee grants his/her consent to this in a separate written declaration, also specifying an electronic address for this purpose. Before the employee granting the consent, the employer must inform the employee in writing of the conditions for electronic delivery of the document, including the statutory time limit in connection with the so-called fiction of delivery. The consent may be withdrawn in writing by the employee without giving any reason.
The draft amendment also specifies that documents delivered by the employer to the employee will have to be delivered to an electronic address that is not in the employer’s possession. In practice, this means that delivery of the document to the employee’s work email address or via the employer’s internal system will not be effective.
If the employment contract, the agreement on work activity, the agreement on performance of work or amendments thereto, or agreements on termination thereof are concluded via an electronic communications network or service, the employer shall be obliged to send a copy thereof to the employee’s electronic address which is not in the employer’s possession and which the employee has communicated in writing to the employer for these purposes. The employee shall have the right to withdraw from these documents from the moment of the conclusion thereof, but no later than 7 days from the date of delivery thereof to the employee’s electronic address.
The employer shall now be obliged to inform the employee about certain facts related to the terms of the employment relationship within 7 days from the date of its commencement, or about changes to its terms no later than on the effective date of such changes.The original draft amendment foresaw a much broader extent of information to be provided, but this has been limited in the light of comments.
The extent of information provided to employees when posted to another Member State or to a third country will also be considerably broadened.
In the case of providing information in electronic form, the information must be accessible to the employee and the employee must be able to save or print it. The employer shall be obliged to document the transmission of the information to the employee.
The proposed regulation of the working time schedule in the case of agreements on work performed outside the employment relationship has been recast, with the new obligation to inform the employee of the working time schedule at least 3 days before the start of the shift or period for which the schedule is drawn up, unless both parties agree on a different time. However, care will still need to be taken to ensure that the work is sufficiently predictable, also for a reason that Section 37 of the Labour Code, which is to include the anticipated amount of working time per day or week, shall apply mutatis mutandis to the relationships of employees working on the basis of agreements.
As regards the provisions on leave, from the proposed effective date of 1 January 2024, these should also apply to such relationships, with a fictitious working time of 20 hours per week.
Our law firm has long been working to modernize the legal system and the legal environment. We are members of the ICT Union, we are involved in eGovernment projects and actively participate in drafting legislation and activities of working groups in the field of eGovernment, and in training of the professional public and the judiciary.
HAVEL & PARTNERS’ employment law and technology law teams provide legal support for comprehensive projects of HR agenda transition to electronic form of legal acts, the use of electronic identification, and the paperless operation of organizations without limitation of their size or scope of their business.
As part of the New Year’s promotions at HAVEL & PARTNERS, the law firm’s top management has been expanded by two new members – Štěpán Štarha, partner co-responsible for the Slovak office and for the team specialising in IP/IT law, became an equity partner as of 1 January 2023. Jiří Kunášek, a leading expert in corporate, commercial, and financial law and advisory services for private clients, became a partner as of the same date. Seven other lawyers have been promoted to more senior positions.
“At HAVEL & PARTNERS, we pride ourselves on continuously maintaining a work environment that enables rapid career growth for all colleagues who demonstrate exceptional erudition in legal or tax areas, a high level of work commitment and are sensitive to specific needs of each client,” Jaroslav Havel, the managing partner of the firm, commented on the firm’s HR policy. “Štěpán and Jiří have provided long-standing support to our legal teams, which is why I am pleased that starting from January, they will be even more intensely involved in the management of the firm, as well as its sales and marketing activities in the Czech Republic and Slovakia,” Havel commented on the latest changes.
Štěpán Štarha (37) has 14 years of experience; he has been working at HAVEL & PARTNERS since 2009, and has been gradually promoted to his current position as an equity partner of the firm. He is co-responsible for the management of the Slovak office and for the teams specialising in IP/IT and automotive law. In addition, he is also engaged in the management of the Brno office. In his new position, he will primarily continue to focus on the development of the Slovak team, customer care for the growing number of local clients, as well as advice to Czech clients eager to do business in and expand to the Slovak market. Štěpán advises a number of private companies, including the largest banks, as well as public administration bodies. He specialises in information systems and telecommunications law, IP and industrial property law, personal data protection, law of contract, and the conflict of law provisions. He also advises private clients in the Czech Republic and Slovakia on legal protection of personal and family property, and with intergenerational capital transfers.
Jiří Kunášek (34) has over 10 years of experience. He focuses on commercial and corporate law, particularly corporate litigations, corporate transformations, and holding structures. He also provides comprehensive legal advice to private clients and assists them with the protection and management of personal and family property as well as private assets and intergenerational capital transfers. He has taken part in building a dedicated family property law group and also provides support to a successful inheritance law team that represents clients in broad and complex inheritance disputes and settlements. He also focuses onfinancial law and capital markets and provides companies with comprehensive advice on IPOs. Prior to joining HAVEL & PARTNERS, he worked in the company čech partners.
Adam Forst, David Šmída and Jaroslav Šuchman have been promoted to the position of counsels in the law firm. Vojtěch Katzer joined the team of managing associates while Josef Bouchal, Martin Pecha and Pavlína Petráčková were promoted to the position of senior associates as of 1 January.
As for promotions in non-legal positions, Radka Rainová became the new PR Manager of HAVEL & PARTNERS as of the same date.
We wish you a beautiful and peaceful Christmas holiday. Thank you for your trust and confidence in us in the past year and we look forward to continuing to stand by your side in 2023.
Authors: Ondřej Majer, Juraj Dubovský, Lenka Ostró
The current economic situation in the market entails many pitfalls for many entrepreneurs, who often have to reach the bottom of their financial reserves in order to survive the adverse period. What are the solutions to avoid insolvency and what if insolvency has already occurred? When and how to resolve impending insolvency and what are the penalties for breach of obligations? When to seek an advisor and when to file a bankruptcy petition?
The answers to these questions, and more, were given by an amendment to the Slovak Bankruptcy and Restructuring Act together with the new Impending Insolvency Resolution Act as early as last summer. Although the amendment has expanded the cases where the obligation to file a bankruptcy petition applies, on the other hand, the new legislation has given entrepreneurs more time and the opportunity to proceed to a preventive solution to the financial crisis in their company, especially in cooperation with a qualified advisor. What entrepreneurs should do if their business is not doing very well is presented below in a short overview.
The new Slovak legislation has brought about, among other things, a change in the definition of insolvency and impending insolvency. A debtor is insolvent if it is unable to pay or over-indebted. A legal entity is unable to pay if it is unable to perform at least two financial obligations to more than one creditor 90 days after the due date, and over-indebted if it has more than one creditor and the value of its liabilities (both payable and non-payable, excluding subordinated liabilities) exceeds the value of its assets. Thus, the original period of 30 days has been extended to 90 days.
There is also a newly defined presumption as to when a company is solvent, namely in cases where, having regard to all the circumstances, it can reasonably be expected that the management of the assets or the operation of the business can be continued and the difference between the amount of its payable financial obligations and its monetary assets, the so-called ‘coverage gap‘, is less than one tenth of the amount of its payable financial obligations or, within a period of not more than 60 days, the coverage gap falls below such a threshold.
At the same time, a definition of impending insolvency has been introduced. The debtor’s insolvency is impending in particular if its inability to pay is impending, i.e., if, taking into account all the circumstances, it can reasonably be presumed that it will become unable to pay within 12 calendar months.
If a company’s insolvency is impending or the company is already insolvent, the Act introduces new obligations for persons acting on behalf of the company, as well as new options how to address such a situation.
New Act No. 111/2022 Coll., on Impending Insolvency Resolution, which regulates the institutes of preventive procedures, namely public and non-public preventive restructuring, has brought about the possibilities of resolving impending insolvency. The use of one of the preventive procedures is only an option for the debtor, not an obligation.
The main motivation for entrepreneurs should be to arrange their financial obligations and assets quickly, efficiently, and economically so as to avoid insolvency and keep the business running during the adverse period.
To help resolve an impending insolvency, the Act allows for the use of an advisor in a preventive procedure to help the debtor develop a plan and implement appropriate measures to avoid insolvency by assessing the debtor’s financial situation. The debtor’s advisor may be a lawyer, tax advisor or other person who has expertise and experience in this area.
The advantage of such a preventive procedure is its cost-effectiveness, informality and higher creditors’ satisfaction when compared to bankruptcy or restructuring under the Bankruptcy Act. During the procedure, the court will grant the debtor temporary protection from creditors, giving the debtor time to possibly restructure its financial situation.The adoption of the new legislation simultaneously abolished the temporary protection provided for in Act No. 421/2020 Coll., on Temporary Protection of Entrepreneurs in Financial Difficulties.
If the company’s insolvency, as defined above, is already impending and the presumption of solvency no longer applies, the Act requires the company to file a bankruptcy or restructuring petition under the Bankruptcy Act.
The statutory body, liquidator and legal representative of the debtor are obliged to file the petition with the court on behalf of the debtor within 30 days from the date when they became aware or, while acting with professional diligence, could have become aware of the insolvency. Compared to the previous regulation, the debtor is obliged to file a bankruptcy petition not only in the event of over-indebtedness, but also in the event of being unable to pay.
Breach of the obligation to file the petition in good time is sanctioned by a contractual penalty of EUR 12,500, which is subsequently recovered from the obliged person by the trustee, and which pertains to the company. In addition to the contractual penalty, the obliged person shall be liable for any damage to creditors caused by the failure to file the petition in good time.
A court’s final decision on the compensation of the creditors for damage shall be deemed to be a decision on the exclusion. Such a decision means for the statutory representative that for the period specified in that decision, or on the basis of a court decision for a period of three years after the decision becomes final, he shall be prohibited from performing the function of a member of the statutory body or supervisory body in a company or cooperative in the Slovak Republic.
Author: Ondřej Florián, Alexandra Parnaiová
The entry into force of the new Act on Registration of Beneficial Owners[1], which transposed the amendment to the AML Directive[2] into Czech law in June 2021, has entailed a number of novelties – the largest of which were the introduction of sanctions for incorrect or incomplete registration (private law – invalidation of certain shareholders rights, and public law – a fine of up to CZK 500,000) and the disclosure of certain information to the general public.
The Register of Beneficial Owners is currently available in the Ministry of Justice’s web application, and anyone can find out the following information about any company’s beneficial owners – all first names and surnames, month and year of birth, country of citizenship, country of residence, and a brief description of what the beneficial owner status is based on.
The Court of Justice of the European Union (“CJEU”) in its decision in Joined Cases C 37/20 and C 601/20 of 22 November 2022, has ruled that the provision of the AML Directive obliging Member States to make certain information on the beneficial owners of legal entities and legal arrangements available to the general public is invalid.
The decision has caused a stir in practically all the circles concerned, both among its supporters (“the publication of this information does not help in any way to fulfil the purpose of the legal regulation – to reveal ownership structures and prevent access of sanctioned persons to financial markets”), opponents (“the civil society represents another level of control of the correctness of the registration and therefore of the monitoring of the purpose of the regulation”) and especially among the registered beneficial owners, whose personal data are currently partially publicly accessible to all, via the Internet.
First of all, it should be noted that the CJEU’s decision has only affected the AML Directive, and not related national regulations. Moreover, the Court did not prohibit the disclosure of information to the public, but only (albeit on the basis of strong reasoning, see below) annulled the provision of the AML Directive that obliges Member States to make such information available to the public. The Directive is therefore currently silent on accessibility of information to the public.
Since the Directive is generally an EU law that sets only common objectives to be jointly achieved by Member States, while setting only the boundaries within which they may move, the Czech Act on Registration of Beneficial Owners should therefore not be in conflict with the AML Directive itself.
The approach of individual Member States in response to that decision varies. Some countries, such as Luxembourg, have made the information in their registers completely inaccessible (including to public authorities), while others, such as Belgium, Austria and Ireland, have made the registers immediately unavailable to the public. For the time being, the Czech Republic has not proceeded to any modification, while the validity of the Act on Registration of Beneficial Owners remains unaffected (in the wording of its latest amendment which entered into force on 1 October 2022).
In its decision, the CJEU argues that the disclosure of information on beneficial owners to the general public is contrary to Articles 7 and 8 of the Charter of Fundamental Rights of the European Union (Respect for private and family life and Protection of personal data) and that the disclosure of information does not further the purpose of the Directive in any way. So, we are currently in a paradoxical situation where the Czech Act is in compliance with the AML Directive, the AML Directive is in compliance with EU primary law (EU Charter of Fundamental Rights), but the Czech Act is very likely in conflict with EU primary law.
The Czech Act therefore remains in force in its original wording and information about beneficial owners is still (in accordance with the Act and the Directive) accessible to the general public, but the Court’s decision provides very strong argumentative weapons for beneficial owners who would try to make their data in the Register inaccessible. However, the road to making it inaccessible at the same time would inevitably be paved with legal proceedings, which would very likely reach up the Constitutional Court. The second option is that the Czech legislator will respond to that decision by amending the Czech Act, for example, by making the information unavailable to the general public, but returning to the Act the possibility to request specific information, e.g., for investigative journalists or various associations dealing with money laundering issues.
If you have any questions regarding the issue of identification and registration of beneficial owners, please contact our specialised team, which is ready to assist you with the complete registration as well as with the revision of the correctness of the registration after the latest amendment to the Act on Registration of Beneficial Owners.
[1] Act No. 37/2021 Sb., on Registration of Beneficial Owners, as amended
[2] Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC, as amended by Directive (EU) 2018/843 of the European Parliament and of the Council of 30 May 2018 amending Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing and Directives 2009/138/EC and 2013/36/EU
Author: Ivan Rámeš
From 6 January 2023, a large amendment to consumer law will come into force, introducing a number of changes for e-commerce entrepreneurs as well as the operators of brick-and-mortar stores, aiming to further strengthen the protection of consumers. The amendment introduces, among other things, an extension of information obligations of entrepreneurs towards customers, tightening the rules on discount sales, changes to regulation of complaints procedure rules, and introduces new regulation on provision of digital content and services. In light of these changes, the business documents such as terms and conditions and complaints procedure policies will have to be adapted to the new rules. In some cases the information on websites will also have to be modified. Failure to comply with the changes may be heavily fined by the authorities – for the most serious infringements, the entrepreneurs might face the fines of up to 4% of total annual turnover.
The amendment to the Civil Code (“CC”) and to the Consumer Protection Act (“CPA”) implements the requirements of European law (including the Omnibus Directive) and entails a number of changes for both consumers and entrepreneurs. The approved amendment was published in the Collection of Laws last week and will enter into force on 6 January 2023. The new regulation further strengthens the position of the consumer and reflects the development of digital technologies. What are the most significant changes?
Probably the most discussed topic is the new rules for discount sales, applicable both to online sales and in brick-and-mortar stores. If the goods are offered at a discount, the lowest price at which the goods were sold in the last 30 days prior to the discount was granted must also be now indicated. The discount indicated in percentage must be calculated from the lowest price in the past 30 days. The change aims to prevent “artificial” price increases before the start of discount sales (such as Black Friday or post-Christmas sales), as a result of which the discounts may appear to be higher than they actually are. An exception to this new obligation applies to perishable or short-life products, as well as to 2+1 free promotions, i.e., combined or tied conditional offers, or loyalty programmes.
Under the new legal regulation, the entrepreneur shall, without any further circumstances taken into account, only be liable to the consumer for the defects of the goods which the goods already had when accepted by the consumer and which become apparent during the two-year period for exercising rights due to defective performance. Should a defect in goods become apparent during the first year, the presumption is that it already existed at the moment the consumer accepted the goods (previously, this period was only six months). This is another benefit to the consumer as the entrepreneur carries the burden of proof in case of lack of conformity of the goods which occur within the first two years of the time of acceptance of the goods. In order to avoid liability for the defective performance, it is up to the entrepreneur to convincingly prove that the defect did not exist at the time of acceptance of the goods by the consumer.
Another novelty is the possibility of a consumer affected by an unfair commercial practice (e.g., in case of violation of discount sales rules – see above) to withdraw from the contract within 90 days of its conclusion. Depending on how serious the unfair commercial practice is, the customer may alternatively request a reasonable discount or withdraw from the contract. For example, the consumer could request a reasonable price reduction if he finds that he has purchased a product based on a misleading claim falsely guaranteeing the lowest price on the market.
Under the new regulation, the default time limit for delivery of ordered goods shall be 30 days from the conclusion of the contract. The entrepreneur shall be obliged to deliver the goods to the consumer within 30 days unless otherwise agreed with the consumer. It is not sufficient to inform the consumer about a longer delivery period in the business terms and conditions on the website. The amendment requires the entrepreneur to agree on a longer delivery period with the consumer – a practical option is, for example, a check box within the ordering process.
The “order” button we are used to when shopping on-line needs to change its appearance. It needs to be clearer to the consumers that by clicking the button they actually undertake to place an order. It is no longer sufficient that the button only states “order” alone. If placing an order entails clicking on a button, it must be labelled with the words “order with obligation to pay” or other similar wording which makes it clear to the consumer that he must pay when he clicks. If this requirement is not met and the consumer subsequently disputes his order, he may be successful, and the contract will not be valid. If the button remains in its original wording but the customer wishes to place an order, the order will of course be valid. However, in such a case, the e-shop operator faces the risk of being fined by the Czech Trade Inspection Authority.
The new regulation explicitly defines such conduct as an unfair commercial practice – supervisory authorities will therefore more rigorously sanction publication of fake reviews by anonymous users who may have nothing in common with consumers ordering the goods of a given entrepreneur, as well as hiding or modifying reviews already given to make them seem more positive. Under the new regulation, each review should be linked to a specific order of a consumer. Such information is not public, however, the Czech Trade Inspection Authority may request it in the case of an inspection. However, we know from our experience that manipulation of reviews is sanctioned by the Czech Trade Inspection Authority even under the current legislation.
The amendment will also bring about stricter regulation for informing consumers about personalised pricing – commonly used for example for sales of airline tickets.i The change is justified by the practice of entrepreneurs who track and profile consumer behaviour based on automatically stored behavioural data and customize the prices on that basis. Where the price is personalised to the consumer on the basis of automated decision-making, the consumer must be transparently informed of this fact prior to the conclusion of the contract. The customer may be informed during the ordering process or directly with the specific goods (or, where appropriate, additionally in business terms and conditions). When applying personalised pricing, the entrepreneurs must also continue to comply with the requirements of other applicable legislation (in particular in the areas of data protection and discrimination).
The current legislation requires the product to be accompanied by written instructions. The written form means also electronic form under the Czech legislation, therefore the requirement for a written form should not be confused with the need to provide instructions on paper. However, the current legislation requires written instructions to be “attached”, which is interpreted in practice to mean that the instructions must be provided in paper form together with the product. The amendment abolishes this requirement especially in light of the development of modern technologies. For example, in the case of provision of digital content such as mobile applications, attaching a paper manual would not even be feasible. If the consumer requests it, he will be entitled to be provided with the instructions on a durable medium – which can be paper as well as electronic mail.
The consumer is still entitled to withdraw from the contract for goods purchased through an e-shop within 14 days. The consumer should now, however, only test the goods purchased online in the same way as it would be allowed for him when testing in a brick-and-mortar store – this rule was already applicable prior to the amendment, but was not explicitly provided for in the text of the legislation. If the consumer uses the goods for a common use within 14 days of purchase and then decides to return them, the seller does not have to refund the full price. The consumer is now liable to the entrepreneur for any diminished value of the goods due to a higher degree of use than is necessary to check characteristics and functionality of the goods.
The amendment tightens the terms and conditions for concluding contracts over the phone. Such a contract will now be concluded only after the consumer has received the contract in text form from the entrepreneur and has confirmed the offer to the entrepreneur electronically or signed it in paper form. Anchoring that rule in the new regulation is justified by the abuse of this method of concluding contracts towards the elderly people.
Another novelty is the regulation of on-line marketplaces – an on-line marketplace is a portal operated by an entrepreneur that allows consumers to conclude contracts remotely with other traders or consumers (for example, Amazon globally). So far, this type of service has not been defined in the legislation, although it is increasingly used. On-line marketplaces must, among other things, transparently provide information about the criteria used to determine the order of services or products displayed or searched for on the web (including, for example, information as to whether certain services or products are favoured over others on the basis of paid advertising). They must also inform whether the third party offering the services or products is an entrepreneur or not (this is important for consumers because if the seller is not an entrepreneur, many of the rights that consumers have in their relationship with an entrepreneur do not apply).
The amendment introduces new regulation of provision of digital content and services, an area which has not been comprehensively regulated at EU or national level so far. Digital content includes software, applications, e-books or audio files in any form (for example, even in a smart watch or smart phone). For example, video, audio or other file sharing services, digital games or social media can be described as digital services. The amendment deals with specific features of digital products, such as the obligation to provide updates of the digital content or services for a certain period of time or how to establish liability for defects in such products and introduces certain obligations for entrepreneurs in this respect. In addition, digital content and services are usually protected by intellectual property rights, so their provider must possess the respective licence.
In view of potential high fines, we are already adjusting our clients’ purchasing processes, business terms and conditions and complaints procedure policies, as well as the information required to be published on their websites. We will also be happy to assist you with interpretation of proposed legal provisions, modification of legal documents or correct setting of information obligations. We will also present some of the most significant changes in more detail on our blog where we regularly inform not only about new developments in consumer law.
HAVEL & PARTNERS’ M&A experts advised PosAm, a company majority-owned by Slovak Telekom, the largest telecommunications operator on the Slovak market, on the sale of the Slovak company Commander Services. A 100% stake in Commander Services was acquired by the newly rebranded Czech software company Seyfor (formerly known as Solitea), which is part of the Sanberg Capital portfolio.
The Slovak company Commander Services specialises in car management software and since its establishment in 2005 has profiled itself as a domestic leader in the field of vehicle monitoring via GPS and GSM technologies in the B2B segment.
The legal team that assisted the client in the sale of the company consisted of partner Ondřej Majer, counsel Petra Čorba Stark, senior associate Pavel Zahradníček, and associate Ivana Gajdošová.
Thanks to the versatility of the specialised teams and the top know-how of the firm’s lawyers, we provided extensive legal advice to the client in this transaction, not only in the area of mergers and acquisitions, but also in the area of intellectual property protection.
In the TOP 10 largest law firms ranking, which is compiled by the SME daily and The Slovak Spectator according to combined measurable criteria, HAVEL & PARTNERS is the largest Czech law firm, the third largest regional law firm, and the fifth largest law firm active on the Slovak market. In addition, this year it defended its victory from last year and for the second time in a row was ranked first in the Intellectual Property and Competition Law categories. This year it was ranked among the top 10 largest law firms for Mergers and Acquisitions, Real Estate, Employment law, and customer-supplier relationships.
“We are very appreciative of being ranked in leading positions in the TOP 10 largest law firms ranking and we are pleased that we are the only law firm to have won in two categories and also scored in new ones, so we are constantly rising in the ranking despite the fact that we have had a year full of unexpected challenges. We want to continue to strengthen our position as the largest and most successful Czech-Slovak law firm, which is the first choice for Czech companies operating in Slovakia and Slovak companies operating in the Czech Republic. I thank our clients for their trust, which motivates us to keep working on ourselves, and all my colleagues in Slovakia for their commitment and loyalty,” said Jaroslav Havel, the firm’s founder and managing partner. “Once again, we have shown that our priority is professional background and also perfect service for our clients. In addition to the excellent expertise and deep work commitment of all colleagues, I appreciate especially their teamwork.”
Being ranked in the TOP 10 not only confirms the significant position of HAVEL & PARTNERS on the legal services market, but also reflects the high quality of the services provided, the exceptional versatility of the specialised teams and the cutting-edge know-how of the firm’s lawyers.
Intellectual Property Law
For the second time in a row, the firm won the Intellectual Property Law category, where it was ranked first among the largest and most prestigious law firms: “We are extremely pleased to have defended our last year’s victory and to have once again been ranked first among the largest law firms in the field of IP law. Our Intellectual Property practice and team remains ranked as one of the most successful practices in Slovakia and abroad. This year we were also recognized by prestigious foreign ratings IP Stars and World Trademark Review, which confirms that our work is of exceptionally high quality and that we are able to assist our clients in the most challenging cases not only in Slovakia, the Czech Republic, but also internationally,” commented Štěpán Štarha, partner of the law firm, on this year’s victory. Intellectual Property law has long been one of the firm’s major practice areas. The team of more than 20 experienced professionals is one of the largest ever advisory groups with this specialisation in Slovakia and the Czech Republic. It works for global brands, as well as major Slovak and Czech companies and prospective start-ups, to which it provides legal services in connection with the effective protection of intellectual property, ranging from the registration and management of a portfolio of industrial rights anywhere in the world, through the enforcement of rights to comprehensive strategic advice. At the same time, the team profiles primarily in the area of new technologies and in the combination of intellectual property law with technology law and venture capital.
Competition Law
For the second time in a row, the firm also won the Competition Law category and thus became the most successful law firm in this field in Slovakia. “We very much appreciate the success in Slovakia. We have been systematically building up our competition law advice here for eleven years. During this time, we have had the opportunity to work on large projects and to gain the trust of many major Slovak, Czech and foreign clients. We thank for their trust and appreciate it very much. Winning the Competition Law category again confirms the excellence of our team and commits us to continue to improve,” said partner Lenka Štiková Gachová and partner Robert Neruda added: “We offer our clients unique know-how for addressing complex competition and regulatory issues, as we are the only firm on the market that effectively combines legal and economic competition law advice.” With two dozen top lawyers and economists, the competition advisory group is one of the most experienced, largest and fastest growing practices not only in Slovakia and the Czech Republic, but also in the whole of Central Europe. The quality of our services in the field of competition law is confirmed not only by our constantly growing clientèle, but also by a number of prestigious local and international awards. The firm defended its position this year and won again the Competition Law category also in the prestigious Law Firm of the Year competition.
The 10 LARGEST LAW FIRMS 2022 ranking, the results of which were published on 28 November 2022, has been compiled since 2015 by the SME daily in cooperation with the English newspaper The Slovak Spectator according to combined objective criteria.
Methodology:
The 10 largest law firms ranking in Slovakia was compiled in cooperation with the English newspaper The Slovak Spectator. Six criteria influenced the ranking (for the number of lawyers and the number of cases, data from 2021 were taken into account; for revenues and profit, the averages for 2019-2021 were taken into account). The weighting of each criterion was as follows: number of attorneys (30%); number of persons (excluding attorneys) with a law degree with more than three years’ experience (16% weighting); number of persons (excluding attorneys) with a law degree with less than three years’ experience (8% weighting); revenues from the sale of own products and services (23% weighting); profit or loss after tax (7% weighting); number of cases for which it has been paid a fee of EUR 20,000 – 50,000 (1 point) and a fee of more than EUR 50,000 (1.5 point) (16% weighting).
Full results are available HERE
Author: Lívia Djukić
Co-author: Kateřina Nešpůrková
On Wednesday 23 November, the Czech Government approved a new whistleblower protection bill implementing Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons who report breaches of Union law (the “Whistleblowing Directive”). The original bill debated in the previous Parliament but failed to be passed prior to the autumn elections last year, has since undergone a number of modifications. We bring you an up-to-date overview of the most significant provisions of the approved bill.
A number of global and major national companies have already implemented centralised group-wide whistleblowing systems and hoped that this global solution would also be sufficient in the Czech Republic after the implementation of the Whistleblowing Directive. However, the European Commission has unambiguously rejected this interpretation and the approved Czech bill complies with this interpretation.
The act only allows employers with up to 249 employees to share or use another company’s Internal Reporting System. However, even in this case, each company has its own responsibility for meeting all legal obligations. All other Czech companies with over 249 employees must establish their own reporting channels and their own investigation capacities to deal with reports. This applies to all larger companies with more than 249 employees, regardless of whether or not they are part of a group. We therefore recommend consulting in advance any shared reporting within a group with experts who will verify that Czech internal reporting system requirements laid down by law have been met.
The approved bill stipulates that the act will come into effect on “the first day of the second calendar month following the date of its promulgation”. The specific date will therefore depend on the speed of the legislative procedure in the Parliament.
The bill has been gradually reduced to meet the minimum requirements laid down by the Whistleblowing Directive, and therefore we do not expect any significant changes at the next stage of the legislative process. A number of our clients have already implemented a whistleblowing system. What was their motivation?
If you need more information about our whistleblowing solution, we recommend you visit www.fairwhistle.cz. In the past year, we have implemented and now administer ethics hotlines and act as the Whistleblowing Officers for a number of our clients. We can thus pass on our extensive practical experience to you. We will keep following the Czech legislative process for you and keep you updated on whatever is relevant to your business.
