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The Act of the Year survey - Entrepreneurs revisit the impacts of the quality of legislation on the Czech business environment

For the sixth time, entrepreneurs revisit the impacts of the quality of legislation on the Czech business environment in the Act of the Year survey. Legal regulations adopted in the past calendar year that have had a significant impact on the local business environment have been nominated in the survey in which hundreds of prominent Czech companies take part every year. The goal of the survey is to foster discussion among the Czech entrepreneurs, politicians and experts on the quality of legal regulations. The sixth year of the prestigious competition is being held by Ambruz & Dark Deloitte Legal in cooperation with the survey’s partners.

"This year’s nominations for the best and worst legislative achievements include, as usual, tax regulations, due to their immense impact on business. Nevertheless, it seems that Czech entrepreneurs still cannot come to agreement on whether it is more important for them to have clear tax regulations and know them sufficiently in advance, or, whether the first fiddle is played by a tax rate. Even though it is a bit of a Sophie’s choice that the businessmen be successful in partnership with a public sector, it will obviously be necessary to reach a stronger consensus across the business community”, said Tomáš Babáček, Chairman of the Act of the Year Survey Nomination Committee and attorney-at-law at Ambruz & Dark Deloitte Legal.

In preparing individual nominations, the Nomination Committee considered the recommendations that could be sent by the public through the website www.zakonroku.cz from January to 20 February 2015. In nominating five choices for the “Act of the Year” category and the five nominations for the “Flop of the Year” category, the Committee took into account especially the anticipated practical impact and the experience of the Czech entrepreneurs with the application of specific legal norms. When compared to the previous year, the number of the members of the Nomination Committee increased by two members (from 20 to 22). It primarily consists of legal experts from across the legal industry, mostly attorneys-at-law and corporate lawyers and other persons engaged in law.

The final results of the survey will be decided by the companies’ representatives, entrepreneurs and experts via voting that will run through mid-May 2015. The survey results will be announced in early June 2015 at the latest.

“The Nomination Committee agreed that 2014 was rather calm from the perspective of newly adopted legal regulations. Partially, on account of (not only legal) public coping with the impacts of the private law recodification. A stormy discussion broke out in respect of the Civil Service Act, in which case it was discussed whether to include this act into the survey at all and if so, then in what category. In the end, the Civil Service Act was nominated both for the Act and the Flop of the Year, in each case due to a bit of a different aspect”, Tomáš Babáček added.

Changes lowering the administrative burden of entrepreneurs (amendments to the Trade Licensing Act and the Employment Act) were nominated for the Act of the Year. The Nomination Committee also appreciated the changes in the Rules of Procedure of the Chamber of Deputies which, in general, should contribute to the adoption of better quality legislation.

Also this year, tax regulations adopted at the last minute before the end of the year were nominated for the Flop of the Year, even though they are fully substantial for entrepreneurs. Furthermore, the Nomination Committee evaluated as negative the changes bringing useless extra obligations to the entrepreneurs and municipalities without bringing fundamental positives for consumers or the state (amendments of the Food Act and the Waste Act). The nomination for the Flop of the Year was also fully deserved by the amendment to a lawyers’ tariff, resulting in lower receivables not being worth enforcing by creditors, which in fact basically motivates debtors not to pay their debts.

Rules of the Act of the Year 2014 Survey

Only Czech or EU generally-binding legal regulations which became effective in the past year may be nominated in the survey: fundamental laws, acts, ministry regulations, government decrees or EU directives and regulations. The nominations can also apply to new international treaties with an impact on the Czech business environment.

In the category of the worst legislation achievement of the year, voters can also choose legal regulations that were cancelled in a relevant year, in particular as a result of the decision of the Czech Constitutional Court or the Court of Justice of the EU. The initiators, or anybody who contributed significantly to the adoption of the regulation, are stated as the authors of the nomination.

You will find more information about the Act of the Year 2014 Survey and the results of the previous survey at: www.zakonroku.cz.