News in Brief, April 2024

DOMESTIC NEWS

• The following regulations were published in the Collection of Laws in March:
  • Decree No. 50/2024 Coll., amending Decree No. 358/2013 Coll., on the provision of data from the real estate register
  • Decree No. 51/2024 Coll., amending Decree No. 245/2016 Coll., implementing certain provisions of the Customs Act
  • Government Regulation No. 55/2024 Coll., on the inadmissibility of applications for a residence permit in the Czech Republic submitted at embassies by third-country citizens 
  • Government Regulation No. 63/2024 Coll., on certain details of the provision of accommodation and related services to persons granted temporary protection
  • Notice of the Ministry of Labour and Social Affairs No. 37/2024 Coll., on the relevant amount for determining the total amount of wage claims paid to one employee under Act No. 118/2000 Coll., on the protection of employees in the event of the employer’s insolvency
  • Government Regulation No. 70/2024 Coll., on the maximum amount of allowance to support the employment of persons with disabilities in the sheltered labour market
• The government has approved the creation of a digital regulatory sandbox to support fast-growing companies such as start-ups and spin-offs in financial innovation and decentralised technologies. To be launched by CzechInvest by the middle of this year, the sandbox will provide support ranging from consulting through legal advice to the technical testing of innovative products.
• At the ECOFIN Council in March, a joint meeting was held with EU ministers responsible for employment and social policy (EPSCO Council) on the importance of social investment for increasing EU competitiveness. The finance ministers also took note of the European Commission's evaluation report on the implementation of the Recovery and Resilience Facility (RRF) between 2021 and 2023. EUR 224 billion has already been allocated to EU member states through the National Recovery Plans, while the Czech Republic has so far drawn around EUR 2 billion. 
• It will only be possible to buy stamps, exchange damaged unused stamps for new ones, and return undamaged stamps until the end of this year and only at selected branches of Česká pošta, where a fee will be charged for the service according to the current price list.
• From 1 April 2024, the new Motor Third Party Liability Insurance Act (30/2024) and Decree 69/2024 Coll. are effective. The new regulation responds to the EU directive. Green cards for proving third party liability insurance in the Czech Republic have been abolished and replaced by online insurance registrations. Checks will thus be possible without stopping vehicles, but for trips abroad, the green card will still be necessary or appropriate to avoid any complications. Registration operations for changes in the road vehicle register will also be simplified. The permanent move to an online data exchange system and the related abolition of the green card for national purposes will take place after a six-month transition period, i.e., from 1 October 2024.
• The Ministry of Industry and Trade is looking for ways to involve artificial intelligence in the processing of trade licenses and thus facilitate communication between licensed traders and the state. Last year, the ministry launched a new Licensed Trade Portal at https://www.rzp.cz/, which significantly expands the existing trade licensing register services for the public.
• The government has submitted an amendment to the Energy Act, which aims to regulate the rules of the electricity market and at the same time better protect customers. It also provides a new regulation of accumulation, i.e., the storage of surplus electricity, the flexibility of the grid, and aggregation. Consumers will be able to better manage their consumption.
• The government has submitted a bill on lobbying to the chamber of deputies. It also includes a bill setting out transparent rules for lobbying and its place within the legislative and other decision-making processes. The aim is to reduce undesirable phenomena such as corruption, conflicts of interest, and clientelism.
• In mid-March, the government approved an amendment to the Labour Code that introduces a mechanism for indexing the minimum wage. The Ministry of Labour and Social Affairs will announce the minimum wage for each calendar year by 30 September of the previous year. The minimum wage amount will be derived from legislative parameters. The government also approved a draft regulation on the maximum amount of the allowance to support the employment of persons with disabilities on the sheltered labour market. The current amount of CZK 14,200 will be increased by CZK 1,500 from April 2024.
• The Ministry of Finance has submitted for comments a draft amendment to the Act on International Cooperation in Tax Administration. The draft implements Council Directive (EU) 2023/2226 of 17 October 2023 (DAC 8). It introduces a new type of automatic exchange of information reported by service providers related to crypto assets and other measures strengthening international cooperation instruments, such as the inclusion of e-money in the exchange of information reported by financial institutions.
• The Ministry of Finance has submitted for comments a draft amendment to the act amending certain laws in connection with the establishment and operation of the European Single Access Point (ESAP). The draft implements Regulation (EU) 2023/2859 of the European Parliament and of the Council of 13 December 2023 establishing a single European access point to publicly available information on financial services, capital markets and sustainability.

FOREIGN NEWS

• The OECD Secretary-General’s Tax Report to the G20 Finance Ministers and Central Bank Governors, published on 29 February 2024 in connection with the introduction of the global minimum tax (Pillar 1), highlights that before the end of 2024, 60% of multinational enterprises (MNEs) falling under this framework will be covered by the Income Inclusion Rule (IIR). With the activation of the Undertaxed Payments Rule (UTPR) in 2025, coverage will extend to 90% of MNEs falling under this framework. For Pillar 1, the report further notes that it is still expected that a multilateral convention will be signed by the end of June 2024.
• The European Parliament had adopted its opinion on the European Commission's proposal for a directive on faster and safer refunds of excess withholding tax (FASTER). The Parliament proposes the following changes: extending the deadline for issuing an electronic tax residence certificate from two to three days, reducing the deadline for registering financial intermediaries in national registers from three to two months, and making it mandatory for financial intermediaries to verify the risks of misuse of electronic tax residence certificates in investment schemes.