On 1 October 2016, the Act on Retail and Wholesale Opening Hours will come into effect. The act regulates the opening hours of businesses during certain public holidays. A violation of the ban on sales during the specified days is an administrative offence, and a penalty could be imposed by the Czech Trade Inspection Authority.
The Act on Retail and Wholesale Opening Hours (the “Act”) was signed by the Czech President on 7 July 2016, and at the end of July, was published in the Collection of Laws under no. 223/2016 Coll. The Act will be effective on 1 October 2016.
Under the Act, sales are prohibited or restricted on the following eight days:
- 1 January – Restoration Day of the Independent Czech State and New Year’s Day,
- Easter Monday,
- 8 May – Liberation Day,
- 28 September – Czech Statehood Day,
- 28 October – Foundation of the Independent Czechoslovak State,
- 25 December – 1st Christmas Holiday,
- 26 December – 2nd Christmas Holiday,
- 24 December – Christmas Eve, from 12 noon to 12 midnight.
The Act applies in particular to the opening hours of wholesale and retail businesses, pawn shops, businesses trading in used merchandise, and facilities for waste collection and purchase (regardless of the size of the business or sales space).
However, there are six exceptions to the ban, and prohibited sales do not apply during the stipulated days to:
- Businesses whose sales space does not exceed 200 square metres,
- Filling stations selling fuels and oil products,
- Businesses in areas with a higher concentration of travellers, such as those at airports, train stations, and bus stations,
- Businesses in healthcare facilities,
- Retail and wholesale during periods of a state of emergency, crisis, or war.
Hence, it can be expected that many businesses, for example, in shopping centres will have to be closed, while businesses included in the exceptions will remain open.
In relation to the wording of the Act, the question arises how to define the “sales space” of a business. Although the Act does not specifically provide an explanation, a reasonable definition could be the gross floor area of a business accessible to customers for the sale of merchandise, and not storage areas, access routes, related administrative areas, essential fittings and accessories, etc.
The Czech Trade Inspection Authority could impose sanctions of up to CZK 1 million on businesses for violating the ban on sales during the stipulated public holidays and other holidays, or up to CZK 5 million for repeated violations.
The legislator’s objective with this new act is to regulate or prohibit sales on certain public holidays and other holidays. However, the reasons provided in the explanatory report to the act include a positive social impact, especially with respect to balancing work and family life, since employees working on holidays currently cannot devote their time to their families or hobbies.
In the explanatory report, the legislator also discusses the economic impact of the Act, favourably assessing the impact of this Act on small and medium-size entrepreneurs in particular, since the Act indirectly restricts the competition of large businesses – thus, it is understandable that prohibited sales on the specified holidays by large chain stores is mostly impermissible. The legislator also favourably assesses the wage savings and overhead costs when businesses are closed. During a period of prohibited sales, increased revenues from tourism and leisure time activities are expected.