Notifying Professional Trade for Natural Persons Residing in the Czech Republic (Czech natural person)

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1 Notifying Professional Trade for Natural Persons Residing in the Czech Republic (Czech natural person) As provided for in section 2 of the Trade Licensing Act, the trade is a continual practice operated independently, under one's own name, as a sole proprietorship, for the purpose of generating profits and under the conditions as provided for in the Trade Licensing Act. The entrepreneur (or authorised representative) must meet both general (Trade Licensing Act, section 6) and special conditions for trading, i.e. professional competence (Trade Licensing Act, section 7), no trading obstacle (Trade Licensing Act, section 8) may exist on the side of the entrepreneur (or his authorised representative), and other conditions as provided for in the Trade Licensing Act must be met. Professional trades are listed in Annex No. 2 of the Trade Licensing Act. Who may notify professional trade? In this case natural persons residing in the Czech Republic are eligible to notify professional trade. For the purposes of the Trade Licensing Act residence in the Czech Republic means habitual residence in the territory of the Czech Republic. What conditions are stipulated to operate a professional trade? General conditions to operate a trade by natural persons are as follows: Full legal capacity, which can be substituted for by a court's approval of permission given by the minor's legal guardian to operate independently a business. Clean Record Evidence. Special conditions for trading: professional competence for professional trades is regulated by special regulations referred to in Annex No. 2 of the Trade Licensing Act or stipulated in that Annex. A national of the Czech Republic or another European Union Member State, as well as persons listed in section 70 (1) of the Trade Licensing Act, can demonstrate their professional competence also with a document certifying recognition of professional competence to be issued by a recognizing authority according to Act No. 18/2004 Coll., on mutual recognition of professional qualifications, namely by the Ministry of Industry and Trade. A citizen of the Czech Republic or another European Union Member State, as well as persons listed in section 70 (1) of the Trade Licensing Act, can demonstrate their professional competence also with documents of professional competence as specified in section 7 (5) of the Trade Licensing Act, which certify that he or she operated the trade in another European 1

2 Union Member State. The act on mutual recognition of professional qualifications shall be used to assess professional competence. None of the trading obstacles as listed in section 8 of the Trade Licensing Act (for example, a punishment imposed by a court or another administrative body, or a sanction in the form of professional disqualifications in the branch or in a related branch for the duration of the punishment) may exist on the side of the entrepreneur and/or his authorised representative (section 11 (3) of the Trade Licensing Act). How to notify a trade? The notification can be filed with any municipal Trade Licensing Office - central registration point (CRP) or sent by mail or to the Office (signed with guaranteed electronic signature, or to the Office's data box). The application can also be filed in person through a point of single contact (Czech POINT). Which Trade Licensing Office can the notification be filed with? The notification can be filed with any municipal Trade Licensing Office in the Czech Republic or through a point of single contact (Czech POINT). What documents are to be submitted by the person notifying the Trade Licensing Office of a trade? Notification of trade using the respective form (to be filled in in advance, or on-the spot). A natural person holding indefinite leave to remain in the Czech Republic demonstrates his or her blamelessness with a statement of his/her criminal record, which shall be obtained by the Trade Licensing Office itself. If, however, an authorised representative is appointed and he or she is a national of another EU Member State or a person listed in section 70 (1) of the Trade Licensing Act, he or she should submit a statement of his/her criminal record or an equivalent to be issued by a competent court or administrative body of the state of which he or she is national, or of the Member State of his/her most recent residence, or a statement of his/her criminal record with an annex containing the information recorded in the criminal record kept by the Member State of which he or she is national, or by the Member State of his/her most recent residence (if the Czech Republic is the Member State of the most recent residence, the Trade Licensing Office itself shall obtain a statement of criminal record). If the state does not issue such a statement or document, he or she should submit a blamelessness affirmation in lieu to be made before a notary or body of the state of which he or she is national, or before a notary or body of the Member State of his/her most recent residence (the documents should not be older than 3 months). This document may be substituted with a document recognizing professional qualification providing that it also demonstrates compliance with the condition of blamelessness. 2

3 If an authorised representative is appointed and he or she is a national of a state other than the aforementioned states and he or she does not hold indefinite leave to remain in the Czech Republic, he or she should submit a statement of his/her criminal record or equivalent to be issued by the state of which he or she is national. If the state does not issue such a statement or document, he or she should submit a blamelessness affirmation in lieu to be made before a notary or body of the state of which he or she is national, or before a notary or body of the Member State of his/her most recent residence (the documents should not be older than 3 months). If the person holds indefinite leave to remain in the Czech Republic, the Trade Licensing Office shall itself obtain a statement of his/her criminal record. A statement of the authorised representative (if appointed) that he or she agrees with his/her appointment; the signature of the statement should be authenticated, unless the authorised representative gives the statement in person before the Trade Licensing Office. A document demonstrating professional competence of the entrepreneur or of his/her authorised representative. A document demonstrating the legal title to use the premises in which the natural person has his or her registered office, if different from the notifier's habitual residence or if he or she has registered a reporting office, special registry or administrative body as his or her residence address (if organisation units of an enterprise are established, the same documents should be submitted also for the organisation unit). If the entrepreneur establishes an organisation unit of an enterprise, also a document demonstrating that he or she has an enterprise outside the territory of the Czech Republic and documents demonstrating its operation; European Union Member State nationals do not have to submit documents demonstrating that they operate enterprises. A document demonstrating that the administrative fee has been paid. All documents, if not drafted in the Czech language, shall be translated, including translation to the Czech language made by an interpreter registered in the list of experts and interpreters (this does not apply to documents in the Slovak language). Signatures and stamps on the originals of submitted documents must be authenticated. The requirement that translation to the Czech language is to be made by an interpreter listed in the list of experts and interpreters, and the requirement that signatures and stamps are to be authenticated do not apply to documents submitted by European Union Member State nationals, unless doubts exist about correct translation or authenticity of the signatures or stamps. What forms are required and where to get them: The "Single Registration Form for Natural Persons" (SRF), which can be used to file submissions with the municipal Trade Licensing Office and with other authorities, namely with the Social Security Administration, sickness insurance fund and Labour Office. The municipal Trade Licensing Office can also be used to apply for registration or file a notification designed for the Financial Office providing, however, that the person is not 3

4 obliged by law to file only electronic submissions with the tax authorities. Submissions for the Financial Office should be filed using a form issued by the Ministry of Finance. Forms can be obtained at any municipal Trade Licensing Office or downloaded from the Ministry of Industry and Trade website section Business support. The natural person should state in the notification the following data, without limitation: First name and surname, or the trade name in case the natural person is registered in the register of companies. Nationality. Address (town, quarter, street, street No., postal code). Personal ID, if allocated, date of birth, place of birth, and surname at birth. If the trade is operated through an authorised representative, the data about this person shall be stated (his or her first name and surname, nationality, address, personal ID, if allocated, date of birth, place of birth, and surname at birth). The objects in accordance with Annex No. 2 to be listed fully or partially. Registered office (town, quarter, street, street No., postal code). The person's identification number, if allocated. The establishment(s) in which the trade will begin immediately after the trade licence is obtained, with the exception of mobile establishments and machines. The title or academic degree of the aforementioned natural persons, if they will use them during trading. The entrepreneur may also state in the Single Registration Form data, which are necessary for submissions to the other aforementioned authorities. What are administration and other fees and how the fees are to be paid: CZK 1000 for notifying a trade at the commencement of trading. CZK 500 for notifying a further trade regardless of whether one or more trades are notified simultaneously. The fee is collected once only; also in case a trade is notified and an application for concession filed. The fee can be paid in cash at the municipal Trade Licensing Office, or by postal or bank transfer. CZK 50 for accepting a submission at a point of single contact, if the application is filed through a public point of single contact (the amount of the fee for notifying a trade, or of the fee for notifying a further trade is maintained). 4

5 What are the time limits for making an entry in the Trade Registry? If the conditions stipulated by the Trade Licensing Act for trade notification are met, the Trade Licensing Office shall register the trade in the Trade Registry within 5 days from the date of notification and issue a statement to the entrepreneur. What regulation is used: Act No. 455/1991 Coll. on Trades (Trade Licensing Act), as amended. What are the related regulations: Act No. 89/2012 Coll., Civil Code; Act No. 90/2012 Coll., on Business Companies and Cooperatives (Business Corporations Act); Act No. 304/2013 Coll., on the Public Registers of Legal Entities and Natural Persons; Act No. 40/2009 Coll. Criminal Code, as amended; Act No. 200/1990 Coll., on Offences, as amended; Act No. 500/2004 Coll., Code of Administrative Procedure, as amended; Act No. 634/2004 Coll. on Administrative Fees, as amended; Act No. 280/2009 Coll., Tax Code, as amended; Act No. 589/1992 Coll. on Social Security Contributions and Contribution to the State Employment Policy, as amended; Act No. 586/1992 Coll. on Income Tax, as amended; Act No. 18/2004 Coll., on Recognition of Professional Qualifications and Other Qualifications of the Nationals of Member States of the European Union and on Amendments to Certain Acts (Recognition of Professional Qualifications Act), as amended; Act No. 435/2004 Coll., on Employment, as amended; Act No. 182/2006 Coll., on Bankruptcy and Settlement (Insolvency Act), as amended; Act No. 179/2006 Coll., on Verification and Recognition of Further Education Results and on Amendments to Certain Acts (Recognition of Further Education Results Act); Act No. 365/2000 Coll., on the Information Systems of the Public Government, as amended Act No. 300/2008 Coll., on Electronic Acts and Authorized Document Conversion, as amended; Act No. 255/2012 Coll., on the Controls (Control Code); 5

6 Numerous regulations of technical character depending on the nature of the trade to be operated. What will the Trade Licensing Office do after a trade is notified? If the notification does not comply with the requirements according to sections 45 and 46, the Trade Licensing Office shall invite the notifier to remedy defects within 5 working days from delivery of the invitation to remedy defects. In the invitation the Office sets a reasonable time limit to remedy defects, which time limit must be at least 15 days. Where serious reasons exist, the Trade Licensing Office can prolong, also repeatedly, the time limit at the applicant's request. The time limit for registration in the Trade Registry and issuing of the statement is suspended for the duration of the time limit stipulated in the invitation. If the applicant remedies defects in the set or prolonged time limit, the notification is considered as free of defects from the outset. Unless the applicant remedies defects in the set or prolonged time limit, the Trade Licensing Office shall open the proceedings and decide that the trade licence did not originate by notification. If the notifier remedies defects before the decision is issued, and the Trade Licensing Office determines that conditions for trade licence have been met, the Trade Licensing Office shall discontinue the proceedings by an entry in the Trade Registry and issue a statement. The Trade Licensing Office will make electronic copies of submitted documents listed in section 46 (7) of the Trade Licensing Act (e.g. of the document demonstrating the legal title to use premises where a legal entity has its registered office) and file them in the Trade Registry. Later, entrepreneurs do not have to re-submit the documents filed in the Trade Registry when reporting trades, applying for concessions or notifying changes in their data, providing that the data certified by those documents have not changed. Remedies: The municipal Trade Licensing Office's decision that the trade licence did not originate by notification, or that the notifier did not meet conditions for a trade licence to originate, can be appealed against within 15 days from the date on which the notifier is notified of it. Appeals should be addressed to the municipal Trade Licensing Office that issued the contested decision. Sanctions for breach of duties when operating a trade: Breach of duties stipulated by the Trade Licensing Act is penalised as provided for in sections 61 to 63 of the Trade Licensing Act. The trade licence can be suspended or revoked or the trade operated in an establishment can be suspended by decision in the cases referred to in section 58 of the Trade Licensing Act. Do you need more information? You can also contact: Directly any municipal Trade Licensing Office - the central registration point (CRP) or their website. 6

7 Related procedures and guidelines and other documents: See the trading guides (Life Situations) at Responsible for the correct guide: The agenda of trade licences is the responsibility of the Trade Department, Entrepreneurship Section of the Ministry of Industry and Trade. Tel: Person responsible for the described guide: JUDr. Luděk Holubec tel: The guide has been prepared according to the legislative situation as of: The guide has been most recently updated or verified as of: Guide applicability: Modifications and discontinuation of this guide depend on applicable regulations relating trades. 7

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