Act No. 416/2022 Coll. entered into force on 15 January 2023. The aim of this amendment to several commercial laws is to enable fully electronic incorporation of companies, in particular limited liability companies. The amendment follows an amendment to the Notarial Code from last year, which made it possible to establish a company by a notary using videoconferencing and therefore without the personal presence of the founders.

The amendment abolished the obligation to submit the so-called preliminary trade licence to the registry court for the purpose of entering information on the subject of business in the Company Register. The explanatory memorandum to the amendment argues that the necessary acceleration of the formation of the company will occur and that the possible absence of a trade licence for the company will not have a negative impact on the rights of third parties, as the law protects them from persons acting as experts without authorisation.

It will also not be necessary to submit certain documents twice (both when registering the company in the Company Register and when registering the trade with the Trade Licensing Office), such as the legal reason for the use of the premises, where the company will have its registered office.

The amendment has also established the obligation of the Ministry of Justice to create an official model of the founding legal act and to publish the model on its website (available HERE); the model includes a brief commentary. If you use the model articles of association, the registration of the new company in the Company Register by a notary is exempt from the court fee, which would otherwise be CZK 2,700 for an LLC.

The use of the model articles of association is associated with a lower amount of the notary’s fee for drawing up the notarial deed of incorporation of the company, which is reduced to CZK 2,000 instead of CZK 4,000 (and more, depending on the amount of registered capital).

With effect from 1 July 2023, the amendment also introduces a register of excluded persons, which will include all persons, who are prevented from exercising their functions under article 47 of Act No. 90/2012 Coll., on Companies and Cooperatives, as amended. However, this register will not be public and will only be accessible to the court, notary or any other person in case of a successful request for information from the register.

Author: Veronika Odrobinová, Petr Berdych