News

Investment incentives for strategic investments – new conditions

We would like to inform you that a draft of an amendment to Government Decree No. 221/2019 Coll., on the Implementation of Certain Provisions of the Investment Incentives Act (“the Amendment”) has been published. The draft of the Amendment will be further discussed by the Government. As a result of the Amendment, please see the possible changes in the eligibility conditions for strategic investment project incentives:

• acquisition of tangible and intangible fixed assets in the amount of at least CZK 2bn (instead of the current CZK 0.5bn), with at least 50% being spent on the acquisition of machinery, and
• creation of at least 250 new jobs (instead of the current 500).

The above-mentioned values ​​would not apply to:

• the manufacturing of strategic products for the protection of the lives and health of citizens.
• investment projects carried out in the high-tech manufacturing sector (as defined by the Classification of Economic Activities [CZ-NACE]) and activities with higher added value, where research and development is carried out using a so-called key enabling technologies. The specific areas of research and development, as well as the selected key enabling technologies, are listed in a separate annex to the amended Decree (Annex No. 3).

Such investment projects would be considered strategic investments regardless of the size of the investment or the number of newly created jobs.

Another novelty would be the change in the size of cash grants for acquisition of assets for strategic investment projects in the manufacturing industry, namely:

• up to 20% of the total eligible costs for investment projects implemented in the Karlovy Vary region, Ústí nad Labem region or Moravian-Silesian region.
• up to 10% of the total eligible costs for investment projects implemented in all other regions.

The grants are capped at CZK 1.5bn (the current size of the cash grant is 10% of the total eligible costs for all regions).

Currently, the date of discussion of this Amendment, which should be effective from 1 January 2022, has not been published yet. We will keep you informed of further developments.

If you are interested in this topic, we will be happy to discuss it with you.***