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The Buzz in the Czech Republic: Interview with Martin Hrodek of Baker & McKenzie

The Buzz in the Czech Republic: Interview with Martin Hrodek of Baker & McKenzie

Czech Republic

“First of all, I have to say that the legal market and most of the firms are doing quite well right now in the Czech Republic,” says Martin Hrodek, Managing Partner at Baker McKenzie in the Czech Republic, “as the sector did some visible recovering during the past two years.”

Hrodek notes that the high effectiveness of tax collection proceedings and transfer pricing matters is drawing the attention of firms and clients. “On one hand, tax offices and directorates when reviewing various schemes and designs, are becoming more smart. But they still have a long way to go in order to better understand transfer pricing issues, which are particularly important for Czech companies, as we have here many production plants of international companies, which are delivering their products to parent companies which are then distributing them all over the world.”

The first round of the 2018 Czech presidential elections were held on January 12-13, 2018, but as no candidate won a majority, a run-off election between the top two candidates will be held on January 26-27, 2018. In Hrodek’s opinion these political events are not likely to affect the legal market at all. One thing that may, however, is that “the justice minister, Robert Pelikan, who served as justice minister for the former government as well, wants to make proceedings in front of the Czech Supreme Court more complex.” According to Hrodek, “right now we have to go through two instances of court proceedings – during the first instance courts issue the judgments, then the losing party has the opportunity for an appeal, so comes the second instance to decide whose judgment will be considered as final. Mr. Pelikan wants to introduce a third instance procedure, meaning that the judgment of the second instance would not be considered final and enforceable. He is pushing this idea, which evidently will slow down more already slow court proceedings.”

Otherwise, Hrodek reports, while no new legislation concerning Czech lawyers is expected right now, the development of artificial intelligence is affecting the way law firms operate. “In my opinion firms will have to reinvent themselves and come up with new solutions as to how to better serve the global clients in the changing future. If they won’t do that, IT companies could take over the market to some extent. Regardless, I think that law firms in the Czech Republic are opened up to new ways, I find them less conservative them some firms from the US for example.”

When asked what kind of deals are keeping companies busy these days in his country, Martin Hrodek said that the M&A market is booming, the GDPR, MIFID 2 and other regulations are also bringing more regulatory work for most firms, and new rules on Civil Procedures are anticipated, though he’s not sure when they will be approved by the Parliament.


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