Thanks to its strategic geographic location in the center of Europe, its stable economy, and human capital resources, the Czech Republic is a desirable destination for foreign investors who are planning to expand their businesses to the European region.
Advantages of doing business in the Czech Republic
The Czech Republic offers an interesting mix of benefits for foreign investors and entrepreneurs who wish to enter the European market, some of which are outlined below:
- Located in the heart center of Europe, the Czech Republic acts as a gateway to both the eastern and the western markets.
- A huge share of the Czech Republic population has secondary and tertiary education and notably, a highly qualified, creative, and resourceful workforce is available at standards that are conducive for business operation.
- The country benefits from a long tradition respecting industrial production and has one of the most skilled workforces in Europe.
- Foreign investors do not need to obtain special approvals for starting a business there unless the company’s activities will be associated with sectors such as national security or nuclear energy.
- As a member of the European Union, any company in the Czech Republic benefits from the country’s trade relationships and commercial relations with most of the business centers in the world.
- The Czech Republic shows a high level of entrepreneurship and favorable conditions for doing business.
- Czech Republic shows high standards of living, a vibrant economy, and a refreshingly aesthetic landscape.
Types of companies in Czech Republic
The Main Business Vehicles in the Czech Republic are the following:
- The Limited Liability Company – (S.R.O. / společnost s ručením omezeným)
- Joint Stock Company – (A.S. / akciová společnost)
- Private entrepreneur – (Živnostenský list)
- Public commercial company – (V.O.S. / veřejna obchodní společnost)
- Limited partnership – (K.S. / komanditní společnost)
How to register your company in the Czech Republic
The process of company formation in the Czech Republic is as follows:
- Determine a Company Name: Business name registration in the Czech Republic is subject to availability and acceptability. The appointed company name can be checked with the Registry of the Regional Commercial Court.
- Choose the most applicable business form for conducting business activity in the Czech Republic.
- Provide Criminal Record Clearance: You must submit certificates of clean criminal records for all representatives and partners of the company
- Provide Real Estate Register Clearance: Submit proof of the registered office of the company.
- Advance the Minimum Share Capital: During company formation, the minimum share capital, if applicable, must be placed in a bank.
- Obtain Trade Licence and Clearances: If the company’s activities in the Czech Republic imply obtaining a license, it is important to be aware of such types of existing licenses and file for them.
- Get the Articles of Association Notarized: Prepare the company’s statutory documents, the memorandum of association, and the notarial deed. Then Notarize the Czech company’s documents in front of a public notary in the Czech Republic.
- Register Your Czech Company at the Commercial Register: Once the company’s documents are signed and notarized, the company’s representatives must register the legal entity with the Commercial Register. In order to register with the Commercial Register, it is vital to fill in a special form with the Register Court.
- Get a Tax Identification Number: Registration for income tax happens simultaneously, and a company receives its Tax Identification Number on submission of the company application.
Documents required for company registration in the Czech Republic
- The company business name
- the lease agreement of the office space, which indicates that the company has an official business address;
- information on the activities to be carried out by the company
- the articles of association (the main documents of a business)
- Trade authorization certificate
- Proof of deposited bank capital
- Extract from the Criminal Registry for all representatives and partners of the company
- a list of the company managers and their signature and consent for the registration into the Commercial Register;
Presently, registration of business in the Czech Republic is also the legal and the most reasonable way to obtain a residence permit in the Czech Republic in the future.
To register your business in the Czech Republic, let’s go ahead and contact your Damalion expert now.
