CZECH REPUBLIC Law and Practice Contributed by: Petr Mlejnek, Robert Klenka, Matěj Manderla, Jan Wagner, Ivo Hartmann and Arbër Balliu, Tenacta, advokátní kancelář, s.r.o.
• the Supreme Court and the Supreme Administra - tive Court. District courts District courts generally function as courts of first instance for most civil and criminal matters. These courts commonly hear contractual disputes, employ - ment disputes, debt recovery proceedings and stand - ard commercial claims. Regional courts Regional courts perform both first instance and appel - late functions (reviewing of district court decisions). More complex commercial matters, insolvency pro - ceedings and administrative matters are commonly • intellectual property disputes; and • significant commercial litigation. High courts High courts act as appellate courts reviewing first instance decisions of regional courts. Supreme Court The Supreme Court represents the highest judicial authority in ordinary civil and criminal matters. It pri - marily addresses questions concerning legal interpre - tation rather than factual issues and seeks to ensure Court review regarding administrative matters com - mences before regional courts, with appeals and cassation review falling within the jurisdiction of the Supreme Administrative Court. Administrative courts commonly review disputes con - cerning: • tax matters; • licensing decisions; • public procurement procedures; • regulatory sanctions; heard at this level in the first instance. Regional courts frequently deal with: • corporate disputes; • insolvency proceedings; uniform application of law. Administrative Judiciary
• immigration issues; and • decisions of administrative authorities.
2. Restrictions on Foreign Investments 2.1 Approval of Foreign Investments Introduction The Czech Republic generally maintains an open investment regime and foreign investors are typically treated equally to domestic investors. Foreign indi - viduals and legal entities may establish companies, acquire ownership interests, purchase assets and conduct business activities without general restric - tions based solely on foreign ownership. Under the Act No 34/2021 Coll., on the Screening of Foreign Direct Investments (the “FDI Screening Act”), a foreign investor is strictly defined as an individual or entity that is not a citizen of the Czech Republic or another EU member state, does not have its registered office in the Czech Republic or another EU member state, or is directly or indirectly controlled by such a person. The regulations also apply to trustees of trust funds under similar conditions. Historically, the Czech Republic has promoted foreign investment and has been regarded as an attractive jurisdiction for both European and non-European investors due to its central geographical location, developed infrastructure and stable legal framework. Nevertheless, increasing concerns regarding national security, strategic technologies and protection of criti - cal infrastructure have led to the implementation of foreign investment screening mechanisms consistent with broader European Union initiatives. Foreign investments may therefore become subject to review where they involve sensitive sectors or where national security considerations arise. Investments Subject to Review Most ordinary investments do not require governmen - tal approval. However, specific transactions involving strategic sectors may be subject to mandatory review procedures under the FDI Screening Act. Under the FDI Screening Act, review requirements generally arise where a foreign investor acquires an
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