Entrepreneurs in the Czech Republic are burdened, same as everywhere else, by a whole range of obligations, major and minor, that they need to observe. One of these obligations prescribes what information must be included on corporate / business documents and internet presentations operated by corporations.
The Czech Civil Code (Act No. 89/2012 Coll., as amended (“CCC”), defines in its Section 435 a general obligation applicable to all entrepreneurs, regardless of their legal form or form of registration, to provide on their business documents that are available to public over the internet (or any other form of remote access) their business name and address of registered seat. In addition, all entrepreneurs registered in the Commercial Registry, also need to provide information on such registration, i.e. specify the ‘section’ and ‘file’ and the name of the registry court. The list of persons, legal or natural, who need to register in the commercial registry is provided in Act No. 304/2013 Coll., on Public registries of legal and natural persons. Entrepreneurs who are registered in another registry, such as in Trade License Registry, shall provide information on such registration instead. All entrepreneurs / businesses which received an identification number shall specify this number on their business documents as well.
The CCC does not define what precisely falls under the term ‘business documents,’ but we may in this respect follow the previous definition as contained in the currently ineffective regulation, namely the former Commercial Code (Act No. 513/1991 Coll.). Commercial code defined business documents as any document of commercial nature, such as orders, business correspondence, invoices and potentially also contracts. In practice this would include any document that would be issued in connection with specific business or commercial activity. On European level, these issues are addressed by Directive 68/151/EEC and Directive 2009/101/EC, which mention the form of letters and order sheets, and which also prescribe that companies that are in liquidation need to denote such fact on their documents. Business documents may also contain / provide additional information, but only in cases that this additional information does not mislead their recipients.
Act No. 90/2012 Coll., on Business Corporations and Cooperatives (“ABC”) imposes further obligations relating to mandatory publication of information. Section 7 para 1 ABC concerns capital companies, i.e. joint-stock companies, limited liability companies and cooperatives, and prescribes that in case business documents provide information on registered capital, this information needs to reflect only the subscribed and paid portions of the registered capital. Section 7 para 2 ABC further prescribes to all joint-stock companies regardless of their particular form or type of shares issued that they produce and maintain a website where the information required by law is publicly available. These websites should exist for the entire duration of the joint-stock company. The extent of information required to be published thereon includes information prescribed for business documents and, besides that, joint-stock companies are also obliged to publish a additional information as per individual provisions of ABC. The most important information to be published are invitations to attend general meetings of the company (Section 406 para 1 ABC) or financial statements or selected information therefrom (Section 436 and 437 ABC) and other. All this information needs to be accessible free of charge and they should be easily found; access to this information should not be subject to additional verification of the user, i.e. such as by requiring registration, passwords etc.
Limited liability companies are not required by law to have websites, but when they do, the extent of information provided thereon is regulated by requirements of Section 7 para 2 ABC, i.e. the website needs to contain information pursuant to Section 435 CCC and information on the amount of registered capital; again this information needs to be provided / accessible free of charge and needs to be easily accessible, in a simple manner after arriving at the given link / electronic address.
Mandatory publication of information applies to any kind of website, be it an e-shop or other form of a website. Obviously, personal websites not related to business activities of an entrepreneur do not need to contain that information.
Foreign capital corporations or foreign cooperatives conducting business on the territory of the Czech Republic through a branch or other establishment need to provide mandatory information in the same extent as the Czech entrepreneurs / corporations. This also applies identically to websites, if they exist Section 7 para 4 ABC).
Failure to publish this mandatory information does not cause invalidity of legal acts conveyed thereon as long as other requirements relating to contents of the legal act are observed. Nevertheless, one should take note of provisions of Section 24 para 1 letter c) of Act No. 200/1990 Coll., on Misdemeanours. This Section stipulates that an offence is committed by those who breach the obligation to provide, on all orders, business correspondence, invoices, contracts and within the framework of information provided / accessible by remote access (i.e. on internet, websites) the information on one’s business firm. The list of this information is practically identical with Section 435 CCC. This breach may be sanctioned by a penalty up to 50 000 CZK (approximately 2 000 €) and by ban on business activity up to one year. In addition, if a corporation or cooperative fails to provide this extent of information on their business documents, the registry court may impose a penalty up to 100 000 CZK (approximately 4 000 € depending on FX rate) – see provisions of Section 107 in conjunction with Section 104 of Act No. 304/2013 Coll., on Public Registries.
With the exception of joint-stock companies, the regulation of mandatory information on business documents and on websites is relatively clear. Given the potential sanctions which may be imposed, it is however advisable to pay adequate attention to this, in bigger picture perhaps minor, obligation not only because the frequency with which this information is provided is generally high but also because the potential audience is rather extensive, and any shortcomings are easily spotted.
With regard to information provided in another very frequent document – corporate email – please note that legislation in the Czech Republic regulates the extent of compulsory publication of information related to business activities only with respect to business documents and company websites; email not being explicitly mentioned and it is unclear whether it would fall within the existing understanding of the concept as discussed above. The authorities have so far concluded that they do not concern themselves with requirements regarding e-mail correspondence and in certain cases also confirmed that no law regulates this issue and that it is a matter of every entrepreneur to choose what information he wishes to provide in an email or not. Thus, the final arbiter of what constitutes a ‘business document’ would be the court.
Despite this conclusion (which cannot be relied on in its entirety) we would recommend, for the sake of legal certainty and given that e-mails may constitute an order or acceptance of order, or even an agreement in certain matters etc., and in order to prevent any future disputes regarding this matter and also for practical purposes (given the fact that such provision of information does not represent any additional cost or harm to the sender / corporation / entrepreneur in any manner of form) to include some basic company information in outgoing e-mails. We would advise to include at least the business name and legal form, plus an address of registered seat and identification number (as this is the essential identification information in CZ), along with basic contact details.