Prague Municipal Court has issued a judgment, which, among other things, notes that a “virtual office” is a legal concept. As of 20 July 2009, the stipulation of article 19c of the then-valid act no. 40/1964 Coll. (the so-called “old civil code”) was amended, by act no. 215/2009 Coll. (the current article 136 and 137 of act no. 89/2012 Coll., the civil code), which has reduced the requirements on the seat of enterprising entities as a result of EU legislation.

In the judgment, a protective order is quoted, where it is stated that the defendant company does not have its own business premises or premises for its own economic activity or storage premises, and therefore doubt arose regarding the actual performance of economic activity of this corporation. The plaintiff argued that she had a regular contract of lease (storage contract) and added that the provision and use of virtual seats in the Czech Republic has been common practice since 2009 and is also in compliance with judicature of the EU Court of Justice, referring to a respective judgment.

The court ruled in favour of the plaintiff in this matter and points out that it does not even follow from the protective order that the tax authorities would consider this fact unlawful in itself or that they would attribute it to the plaintiff as a negative thing as such, but they would only consider it to be one of a number of indications suggesting that the plaintiff shows some risky signs of behaviour.