CZECH REPUBLIC Law and Practice Contributed by: Jan Kohout and Illia Antonov, PRK Partners
investigation or pre-trial stage and are unlikely to come before the courts for several years. The princi - pal reason for this is the need for international judicial cooperation, which inevitably prolongs criminal pro - ceedings. The Only Known Final and Binding Decision The first case in which an individual was finally con - victed by the Czech courts for breaching international sanctions dates from summer 2024 and involved a businessman who attempted to export three luxury cars illegally to the Russian Federation. He received a fine of CZK 300,000 together with a ban on cer - tain activities; the court also ordered the forfeiture of assets obtained through the criminal conduct. Other Ongoing Investigations Other ongoing cases concern exporters of various machinery and engineering products who are under investigation, or have been charged, for circumvent - ing anti-Russian sectoral sanctions by routing exports through third countries. 2.2.5 Mitigation While Czech law lacks a formal “voluntary self-dis - closure” mechanism guaranteeing immunity, several statutory measures serve to lessen or avoid liability. Individuals Individuals can reduce penalties in administrative proceedings through active repentance and damage mitigation, voluntary disclosure and active coopera - tion with the FAU as well as by proving that the breach occurred under duress, threats, or employee subor - dination. Mitigating factors in criminal law include first-time offences, legal error, minor harm, voluntary reme - diation, self-reporting and co-operation. Crucially, the active repentance is not applicable for sanctions breaches under the criminal law. However, general sentencing principles grant courts broad discretion to lower penalties based on post-offence cooperation and remediation. Legal Entities Legal entities can avoid liability in administrative proceedings using the “due diligence” exculpa -
tion defence by proving they exerted all reasonably required effort to prevent the breach via robust com - pliance programmes. This defence is not applicable if it is established that the entity failed to perform mandatory supervision. Alternatively, the FAU may establish a “protective shield” to maintain business operations under strict conditions, often involving an independent controller. The cornerstone defence in criminal law relieves an entity of liability if it deployed all reasonable efforts to prevent the crime, requiring an active, tailored criminal law compliance programme. If liability is established, penalties may be mitigated if the entity implemented effective preventive and post-crime corrective meas - ures. Broader Mitigation Mechanisms in Administrative Proceedings Both individuals and legal entities can utilise prior exemptions from sanctions regimes for humanitarian or economic reasons. Administrative bodies may entirely refrain from impos - ing penalties if prosecution alone suffices for reforma - tion. Conditional dismissal is also available, subject to timely damage compensation. Administrative authorities may also impose extraor - dinary fine reductions below the statutory minimum, provided the final fine is at least one-fifth of the statu - tory minimum. 2.2.6 Strict Liability In criminal law, strict liability is entirely excluded for both individuals and corporations. In administrative law, strict liability applies exclusively to legal entities and individual entrepreneurs, whilst individuals are always subject to a fault-based regime. Even where strict liability applies to legal entities and individual entrepreneurs in administrative and civil matters, it is almost always tempered by statutory exculpation defences, meaning absolute liability is rare.
2.3 Licensing 2.3.1 Derogation
Czech legislation provides for derogations on a case- by-case basis, generally referring to the admissibility
88 CHAMBERS.COM
Powered by FlippingBook