Investment Suppport in the Czech Republic. How to Proceed in the Initial Phase. 12 September, 2012

Transcription

1 Investment Suppport in the Czech Republic How to Proceed in the Initial Phase 12 September, 2012

2 The Association for Foreign Investment is a non-governmental non-profit organisation. The AFI was established in 1996 and associates nearly 40 reputable consulting companies, attorneys at law, property developers etc. from a range of national and international firms. We support the activities of CzechInvest and foreign and domestic investors in the Czech market. The AFI provides a wide range of services covering all phases of investment project Cooperation between the public and private sectors, implemented via the AFI, is considered as best practice in the area of investment support in the Czech Republic. We actively support the development of the business environment and competitiveness of the Czech Republic, including increasing the transparency of the country s public procurement system. We comprise an effective and transparent platform for communication between investors, the state administration, universities and other entities in the Czech investment environment. We are an opinion maker in the area of investments in the Czech Republic. We have organised the prestigious Investor of the Year and Business Property of the Year awards competitions for the past eleven years.

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4 Association for Foreign Investment is a group of service professionals helping foreign entities establish their operations in the Czech Republic and Czech exporters in foreign markets ONE STOP SHOP AFI delivers a broad range of professional services in all core areas related to investment projects AFI has a deep knowledge of Czech business environment AFI provides with the essential information on doing business in the Czech Republic AFI organizes investor visits in the Czech Republic We provide personnel consultancies We arrange connection to public sector institutions We arrange connection to academic and research institutions

5 Legal Advisory Tax & Financial Advisory M&A Advisory Personnel Consultancy and Recruitment including Executive Search Employment agencies Permitting processes (EIA, planning permit, building permit) Architecture, Project and Construction Management Real Estate Brokers Property Development and Financing Construction and EPC Environmental Consultancy Quality Control Logistics Seraching for relevant partners in all business sectors

6 The AFI cooperates and supports the CzechInvest Agency We offer an expert support within the key investment areas We focus on any kind of investment projects including: Strategic sectors defined by the Czech government (Automotive, Aerospace, IT & SW development, Business Support Services, Nanotechnologies, Electrical Engineering & Electronics, Cleantech, Life Sciences, High-Tech Mechanical Engineering) Infrastructure Power Engineering & Raw Materials Mergers & Acquisitions Distribution Centers Properties

7 The AFI and it s member companies have actively assisted within a hundreds of successful investment projects

8 The AFI is involved and coorganizes various types of activities leading to business environment improvement and support for the competitiveness of the Czech Republic. Award Ceremonies, Cooperation of the Year Award Ceremonies; Investor of the Year Discussions with Regional Governors Expert Working Groups Events: Investor of the Year Business Property of the Year Entrepreneurial Project of the Year Breakfasts with Governors Supplier Opportunities Fair Czech Technology Days Support for science, research and advanced technologies Seminars and workshops Expert Working Groups Informal Events Czech-Japan Technology Days

9 Kinstellar Introduction Investing in the Czech Republic: First Steps September 2012

10 Investing in the Czech Republic The purpose of this presentation is to highlight the basic steps that entrepreneurs should take in order to start a business in the Czech Republic.

11 Corporate Establishment First steps Available corporate structures Commercial Register Trade licences Limited liability company Joint-stock company Branch office

12 First steps 1.Choosing an appropriate corporate structure 2.Establishing the company, branch or purchasing a shelf company 3.Applying for trade licences 4.Registering in the Commercial Register 5.Registering for taxes, social security, and health insurance

13 Available corporate structures 1. Limited Liability Company (in Czech společnost s ručením omezeným or s.r.o. ) 2. Joint-Stock Company (in Czech akciová společnost or a.s. ) 3. General Commercial Partnership (in Czech veřejná obchodní společnost or v.o.s. ) 4. Limited Partnership (in Czech komanditní společnost or k.s. ) 5. Cooperative (in Czech družstvo ) 6. Branch office (in Czech organizační složka )

14 Trade licences 1. Obligatory application 2. Different requirements in respect of obtaining different types of trade licences 3. Types of trade licences i. Licensed trades ii. Notifiable trades i. craft trades ii. iii. regulated trades unregulated trades

15 Limited Liability Company 1. Legal entity 2. Created by registration 3. Typically used for small to medium-size enterprises 4. One to fifty shareholders 5. Chaining restriction 6. Minimum capital CZK 200,000 (approx. EUR 8,000) 7. Executive directors 8. General meeting

16 Joint-Stock Company 1. Legal entity 2. Created by registration 3. Typically used for larger enterprises 4. Unlimited number of shareholders 5. Minimum capital of CZK 2,000,000 (approx. EUR 80,000) 6. Bearer or registered shares in material or book-entry form 7. Board of directors 8. Supervisory board 9. General meeting

17 Branch Office 1. Not a legal entity 2. Created by registration 3. Unlimited liability of the founder 4. No share capital 5. Branch manager

18 Comparison Limited Liability Company Joint-Stock Company Branch Office Liability of the Founder Not liable if capital paid up (with exceptions) Not liable if capital paid up (with exceptions) Founder fully liable Establishment By notarial deed By notarial deed Notarial deed not necessary Minimum Registered Capital CZK 200,000 (approx. EUR 8,000) CZK 2 million (approx EUR 80,000) Not applicable Executive Body Minimum one executive director Minimum three members of board of directors One branch manager Supervisory Board Voluntary Minimum three members Not applicable

19 Employment Fixed-term / Indefinite-term employment Termination of employment two month s notice period Termination by employer only on grounds stipulated by law Trial period up to 3/6 months Dismissal / resignation of top-level managers Limited liability of the employee

20 Employment Minimal salary (40 hours work week): CZK 48.1/ hour CZK 96.2/hour CZK 8,000/month CZK 16,100/month Social security charges paid partly by an employer, partly by an employee Mandatory registrations of the employer / employee Non-competition during employment after termination of employment Taxation of legal persons 19% Social security payments 25% of the tax base Premium fully paid by employer, partly deducted from employees salary Health insurance 13.5 % of the tax base Premium fully paid by employer, one third deducted from employees salary Employee representatives Trade unions Employee councils

21 Incentives SUPPORTED AREAS Industry: introduction or expansion of production in sectors of the manufacturing industry Technology centres: construction or expansion of research and development centres Business support services centres: launch or expansion of the activities of: (i) Shared service centres (ii) Software-development centres (iii) High-tech repair centres

22 Incentives TYPES OF INCENTIVES Corporate income tax relief Financial support for creation of new jobs Financial support for training and retraining new employees Transfer of public land at a favourable price Financial support in the case of strategic investments in manufacturing or in technology centres STATE AID INTENSITY The maximum aid amount is 40% (30% in the Southwest region) of total eligible costs. Prague is excluded.

23 Kamil Blažek Chairman of the Steering Committee Association for Foreign Investment Mobile: Contact: Association for Foreign Investment Štěpánská 11, Prague 2 tel.: