Legal forms of business

1. Joint-Stock Company - a.s.

Establishment of the company:

1. Drawing-up of articles of association (společenská smlouva), formation of by-laws, signatures of all shareholders;
2. Payment of capital contribution into the bank account;
3. Application for criminal records of the future executive directors, documents concerning professional qualifications;
4. Registration with the Trade Licensing Office;
5. Registration with the Commercial Register.

• The minimum registered capital is 2 million CZK, or 20 million CZK in case of public offering of shares.
• Minimum number of shareholders: 2 (individuals) or more.
• The shareholders' liability is limited by shares.
• The price of the share may not be lower than its nominal value appearing on the certificate.
• Shares may be trade on the Prague Stock Exchange (Burza cenných papírů Praha - BCPP)
• Companies are required to establish reserves for the case of losses not higher than 20% of their registered capital.
• Statutory body: Board of Directors - at least 3 members.
• Supervisory Board: monitors the performance of the company, right of approval and review of the accounting.
• At least once a year: general meeting of the shareholders.

2. Limited Liability Company - s.r.o.

Establishment of the company:

1. Setting the company's registered office (signing a lease contract, evidencing landlord's ownership - extract from the Real Estate Cadastre);
2. Establishing a bank account for contributions into the registered capital;
3. Criminal records of the future Executive Directors;
4. Certification from the Financial Office attesting that the partners have no outstanding payments;
5. Agreement on the content of the articles of association, drafting thereof and certification from a notary public;
6. Notification or application for a trade license at the Trade Licensing Office (forms are available on the internet);
7. Application for registration with the Commercial Register (within 90 days from step n. 5);
8. Registration with the Social Security Administration and with the health insurance company no later than eight days after registration with the Commercial Register;
9. Registration with the Financial Office within 30 days from step n. 5).

• Minimum registered capital: 200.000 CZK, each member at least 20.000 CZK.
• The liability of each of the members is limited to the total of the unpaid contributions into the registered capital. Once the registered capital has been paid-up, the members are not liable for the company's debts.
• Statutory body: Executive Director.

3. Partnership - v.o.s.

Establishment:

1. Drawing up of the articles of association(společenská smlouva);
2. Paying the amount of the relevant contributions;
3. Application to the Financial Office for a legally verified copy of the trade license or other authorization concerning the scope of the business;
4. Application for an extract from the Criminal Record (not older than three months);
5. Application for documents concerning the professional qualifications (for foreign partners);
6. Application to the Financial Office for certification attesting that the partners have no outstanding payments;
7. Residence permit (for foreign partners);
8. Application for registration with the Commercial Register - payment of 5.000 CZK as registration fees;

• Every partner represent the partnership and is liable for its debts without limitation.

4. Limited partnership

Establishment:

1. Drawing-up the articles of association;
2. Payment of capital contributions - at least 5.000 CZK by limited partners);
3. Obtaining a business license;
4. Appointing the statutory bodies - complementary;
5. Establishment of a seat;
6. Registration with the Commercial Register (within 90 days from step n. 1)

• Statutory body: requirement of one general partner who manages the partnership and is liable for its obligations.