Establishing a Company in the Czech Republic

The Czech Republic is a landlocked country in Central Europe. Its neighbors are Poland to the north, Germany to the west, Austria to the south and Slovakia – its former partner – to the east. The Czech Republic enjoys a stable, parliamentary-democratic government. Its economy, which transitioned to a free market economy, is amongst the most successful of the former Communist Block countries. The Czech Republic joined the European Union in 2004, but is not part of the Eurozone, thus it maintains an active local currency named the Czech Koruna. Businesses that form companies in the Czech Republic benefit from a wide-range of advantages, such as a well-developed local market, a plethora of European market trade agreements and ever expanding technological and financial infrastructure.

Roughly 11 million people live in the Czech Republic and its national capital is the unique city of Prague. “Czech” is the Czech Republic’s official language, and, similar to other nations in Central and Eastern Europe, the country is increasing its adoption of the English language.

The Czech Republic has had a long and complicated history, including, amongst others, German occupation in the 2nd World War, a strong Soviet influence, which eventually led to a Russian conquest, “independence” as part of the Czechoslovakian union and, finally, separation from Slovakia and starting out on a new path that continues through to the present as the independent and sovereign Czech Republic. Ties between the Czech Republic and Israel are excellent, and beginning in the 90’s, the two countries have been collaborating closely in the areas of foreign policy, economics, commerce, and culture. Many view the Czech Republic as one of Israel’s greatest "allies" within Europe, which is why a large number of entrepreneurs choose to establish companies in the Czech Republic to penetrate the European and international markets.

  • During the Czech Republic’s Soviet-communist era, Cuba offered to pay off a $270 million debt to the Czech Republic in bottles of rum alone.
  • The Czech people are the world’s greatest beer drinkers, a title they have respectfully held for many years. The average Czech adult drinks approximately 143 liters of beer, every year!
  • In the Czech Republic, new mothers may elect to take official maternity leave of 2-4 years. The government offers this benefit as an incentive to increase the birthrate and change the demographic trend of a reduction in the number of children born in the country alongside an aging population – a demographic problem that afflicts all of Europe.

The Czech Republic’s economy has progressed in leaps and bounds since the dissolution of Czechoslovakia and completely freeing itself of Soviet influence. Today, the Czech Republic is the most economically prosperous and stable of all of Europe’s post-communist countries. The nation’s economy is that of a developed country, with relatively high levels of income. The country’s per-capita GNP currently stands at 87% of the European average – by all means, a respectable value. The Czech Republic is rich in natural resources, including coal, copper, zinc, led, magnesium, silver and even antimony, as well as a small amount of cooking gas and crude oil for local use. The country’s main export industries include steel, machinery, industrial and agricultural equipment, vehicles, chemicals, weapons, and explosives. The country is in the midst of a process to diversify its economy and is fostering new sectors such as financial services and attracting international investment. This process makes the country especially attractive to entrepreneurs and investors, adding to the many other advantages of establishing a company in the Czech Republic.

General Information


Type of company

Limited Liability Company

Relevant Companies Law

The Czech Republic Business Corporations Act, 2012

Offices

Not required

Language of original incorporation documents

Czech

Finance and Taxation


Currency

Czech Koruna (CZK)

Corporate tax rate

19%

Standard share capital

CZK 25,000 paid in advance

Office Holders


Company Secretary (Secretary)

 
Obligation to appoint company secretary

Not required

Obligation to appoint local secretary

Not required

Type of entity that may function as company secretary

Not applicable

Director

 
Obligation to appoint company director

Required

Obligation to appoint local company director

Not required

Minimum number of directors

1

Type of entity that may serve as company director

Individual

Shareholders

 
Obligation to register shareholders

Required

Obligation to register local shareholders

Not required

Minimum number of shareholders

1

Type of entity that may register as shareholder

Individual and / or a company

Type of shares

Registered shares

Accessibility of Information


Company registrar

Information regarding shareholders is publicly accessible.

Annual Assembly and Reporting


Obligation to hold annual assembly

Required

Obligation to prepare financial reports

Required

Obligation to submit financial reports

Required

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