Types of Enterprises in Czech Republic
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Questions and Answers

What is the minimum registered capital required to form a limited liability company in the Czech Republic?

  • CZK 1 (correct)
  • CZK 500
  • CZK 100
  • CZK 1000

    • What is the minimum percentage of share capital that must be paid before registration at the Commercial Register?

  • 50%
  • 30% (correct)
  • 40%
  • 20%

    • What is the maximum number of members allowed in a limited liability company in the Czech Republic?

  • Unlimited
  • 20
  • 50 (correct)
  • 10

    • What is the name of the type of company that can be formed with one to fifty members in the Czech Republic?

    <p>Limited Liability Company</p> Signup and view all the answers

    What type of company does not have a board of directors in the Czech Republic?

    <p>Limited Liability Company</p> Signup and view all the answers

    Which of the following is NOT a common form of business in the Czech Republic?

    <p>Commandite</p> Signup and view all the answers

    What is the minimum number of members required to form a co-operative?

    <p>5</p> Signup and view all the answers

    What is the minimum registered capital required for a co-operative?

    <p>CZK 50,000</p> Signup and view all the answers

    What percentage of profits after tax must be transferred annually to the indivisible fund?

    <p>10%</p> Signup and view all the answers

    Who can be a statutory representative of a co-operative?

    <p>A foreigner with a Czech residency permit</p> Signup and view all the answers

    What is the liability of a limited partner in a limited partnership?

    <p>Liability up to the level of un-paid contributions</p> Signup and view all the answers

    What is required for a limited partnership?

    <p>A partnership agreement</p> Signup and view all the answers

    What information must be included in the Commercial Register for a partnership?

    <p>Partners' names and addresses, and the amount of paid-in capital by each limited partner</p> Signup and view all the answers

    Who are permitted to actively manage a partnership?

    <p>Only general/unlimited partners</p> Signup and view all the answers

    What is the purpose of NACE classification?

    <p>To provide a framework for collecting and presenting statistical data</p> Signup and view all the answers

    What is the structure of NACE classification?

    <p>Hierarchical structure with four digits</p> Signup and view all the answers

    Since when have various NACE versions been developed?

    <p>Since 1970</p> Signup and view all the answers

    What does NACE stand for?

    <p>Nomenclature statistique des activités économiques dans la Communauté européenne</p> Signup and view all the answers

    What is the minimum share capital required for a joint stock company in the Czech Republic?

    <p>CZK 2 million</p> Signup and view all the answers

    How many members must the supervisory board of a joint stock company have?

    <p>At least three members</p> Signup and view all the answers

    What is a requirement for companies with more than one shareholder?

    <p>A board of directors with at least three members</p> Signup and view all the answers

    When is an audit compulsory for a joint stock company?

    <p>When the company meets at least one of the specified criteria</p> Signup and view all the answers

    What is the advantage of a general commercial partnership?

    <p>No need for initial investment</p> Signup and view all the answers

    What is the minimum share capital required for a joint stock company set up by public offering?

    <p>CZK 20 million</p> Signup and view all the answers

    What is the top-level classification in the NACE structure?

    <p>Sections</p> Signup and view all the answers

    What type of production involves producing custom work for a specific customer?

    <p>Jobbing or one-off production</p> Signup and view all the answers

    What is the primary sector of the economy involved in?

    <p>Extracting and harvesting natural products</p> Signup and view all the answers

    What type of production is also known as flow production or continuous production?

    <p>Mass production</p> Signup and view all the answers

    What is the third level of classification in the NACE structure?

    <p>Groups</p> Signup and view all the answers

    What sector of the economy is involved in processing and manufacturing?

    <p>Secondary sector</p> Signup and view all the answers

    Study Notes

    Co-operatives

    • A co-operative is formed by at least 5 members (or at least 2 legal entities) to undertake business for the economic or social benefit of its members.
    • The minimum registered capital is CZK 50,000, and each member's basic investment must be entered in the Commercial Register.
    • An indivisible fund of at least 10% of the registered capital must be created at the time of incorporation.
    • At least 10% of the profits after tax must be transferred annually to the indivisible fund until it reaches a minimum of 50% of the registered capital.
    • Members are not liable for the debts/obligations of the co-operative.
    • Foreigners may only be statutory representatives of the co-operative if they have a Czech residency permit.

    Limited Partnership

    • A limited partnership is formed by two or more natural persons or legal entities.
    • At least one general partner must assume unlimited liability and is responsible for the obligations of the partnership.
    • Limited partners are only responsible for the obligations of the partnership up to the level of un-paid contributions as originally recorded in the Commercial Register.
    • A partnership agreement must be drawn up.

    Production Enterprises

    • There are three main production methods: jobbing (one-off production), batch production, and mass production.
    • Economists distinguish three broad sectors of the economy: primary (extracting natural products), secondary (processing and manufacturing), and tertiary (services).

    Types of Enterprises

    • Foreigners can choose from four main types of companies: branch office, partnership, limited liability company, and joint stock company.
    • Enterprises can be classified by ownership, organisational form, activity, and size.
    • In the Czech Republic, the most common forms of business are limited liability company and joint stock company.

    Limited Liability Company (s.r.o.)

    • A limited liability company can be formed by one to fifty members.
    • One person can be both the sole owner and executive.
    • The s.r.o. does not have a board of directors.
    • A registered capital of at least CZK 1 (5 euro cents) is needed, and 30% of the share capital must be paid before registration.
    • For non-monetary contributions, they must be clearly settled in the statutory papers.

    Joint Stock Company (akciová společnost)

    • It is commonly used for large companies.
    • To set up a joint stock company, there must be either a founder's deed or an association of individuals or legal entities through a memorandum.
    • The minimum share capital required by Czech law is CZK 2 million (approx. 78,000 EUR).
    • An audit is compulsory if at least one of the criteria is met: net turnover over CZK 80 million, over 50 employees, or a balance sheet over CZK 40 million.

    General Commercial Partnership (v.o.s.)

    • All partners are liable with all their property.
    • The management has to be formed by at least two persons.
    • The advantage of a general partnership is that you do not need the initial investment.
    • The entry in the Commercial Register must include the partners' names and addresses, a statement as to who are the limited and unlimited partners, and the amount of paid-in capital by each limited partner.

    NACE Classification

    • NACE is the classification of economic activities in the European Union.
    • NACE is a four-digit classification providing the framework for collecting and presenting a large range of statistical data according to economic activity.
    • NACE consists of a hierarchical structure, introductory guidelines, and explanatory notes.

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    Description

    This quiz covers the different types of enterprises that foreigners can set up in the Czech Republic, including branch offices, partnerships, limited liability companies, and joint stock companies. It also explores the classification of enterprises based on ownership and organizational form.

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