13 October 2017

LES unconstitutional

In the last issue of Tax and Legal Update, we briefly informed on the proposed amendment to the Act on the Czech Chamber of Commerce introducing the Legal Electronic System – LES. Today, we will look into some of the system’s deficiencies.

Martin Hrdlík
Linda Kolaříková

The bill has passed through the Chamber of Deputies as Print No. 1089 and is now to be discussed in the Senate of the Czech Republic. Although the government had taken a neutral standpoint towards the bill in May, it had voiced some strong reservations that were expected to be dealt with during the bill’s discussion in the chamber – yet, in vain.

The essence of the new regulation consists in the creation of an electronic system concentrating the duties of entrepreneurs in one place and arranging them in a clear and transparent manner. Although such an intention is surely commendable, the proposed manner of its implementation has several serious issues.

In its reservations, the government particularly pointed out the bill’s noncompliance with the constitution: for instance, in the government’s opinion, it breaches the equality principle as it gives undue preference to entrepreneurs over individuals not carrying out business; it also breaches the segregation of powers principle and infringes on the law-making authorities of the Senate, the government and local self-governments. The government also points out the absence of information on duties ensuing directly from applicable EU legislation and international law. The amendment is further criticised for many other, albeit rather formal, deficiencies. 

Thus, together with the original bill, the Senate will receive a letter signed by lawyers and legislators, following along the lines of the government’s standpoint and pointing out the problematic issues. We will have to wait and see how the senators will deal with them.

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