Let us remind you of the two changes in income tax with an international element, which already have or are soon expected to come into effect (or to the end of the applicable time limit).
Clifford Chance, working with Latham & Watkins, has advised the steering committee of the credit financiers, including Commerzbank AG, DZ Bank AG, Erste Group Bank AG, Landesbank Baden-Wurttemberg, and Norddeutsche Landesbank, on the restructuring of the Benteler Group. Ashurst and Schoenherr advised Benteler on the deal.
The most notable recent political event in the Czech Republic was the October 2020 regional election, says Jaroslav Havel, Managing Partner at Havel & Partners. However, Havel is quick to point out that, no matter who has been in office in the last ten years, politicians have not had a major impact on business in the Czech Republic. A more tangible effect of the election, he says, is that his former partner, Jan Holasek, who left the former Havel & Holasek law firm six years ago, has become a member of the Czech Senate.
2020 was quite a year and one all of us will not forget. For employment and labor law developments, 2020 was unlike any other. We saw rapid change and common themes emerge across the globe. One of the major themes was the introduction of government subsidies to support employers and maintain employment across many countries. We also saw an acceleration of remote and flexible working, and which posed both opportunities and challenges for employers and employees alike. There was also an increase in regulations that govern remote working.
A new regulation sets up a system for controlling investments from outside the EU in strategic assets relevant to the security and internal order of the Czech Republic. From 1 April 2021, certain foreign investments in Czech assets (including private) will thus be subject to prior approval by the Ministry of Industry and Trade. The ministry will also be entitled to review any foreign investment up to five years after its completion. The Act defines a wide variety of entries into the target as foreign investment (not only asset ownership but also, for example, membership of a body). There is no experience with investment approval procedures yet, but failure to notify can lead to enormous fines (up to 1% of turnover). Comprehensive preparation of the required documents and information and legal representation in negotiations with the Ministry of Industry and Trade are therefore highly recommended.
The M&A market in 2020 has been significantly affected by the coronavirus pandemic. According to the latest quarterly M&A overview prepared by CzechInvest, the leading agency supporting business and investments in the Czech Republic, “in a very short period of time and on a large scale, many companies have had to close down or limit their operations, dismiss stuff members, and disrupt supply chains.” Although there has been some recovery since May, the situation remains unpredictable. The second and next presumed waves will likely bring even more uncertainty.
About a half year ago, I was sitting in a pitch meeting trying to impress a potential client to win an important mandate for a project that would take two years to close. The meeting was attended by top management of the company and by its founder. We discussed all the technical aspects, our past experience with similar projects, and how we worked as a team. We were hoping to come across as a unified team and show that we knew what we were doing. It was already the second round, so we focused on chemistry and relationship-building. At the end of the meeting we devoted a lot of time to discussing how important it is to be open and honest. I told the client that we would not just agree with them all the time – we would be honest with our fees upfront, we would tell them if we thought they were doing something wrong, we would treat them as friends and partners, we would tell them if we thought their instructions create more work than necessary, and, most importantly, we would always have smiles on our faces, even if we needed to tell them they are wrong.
In The Corner Office we ask Managing Partners across Central and Eastern Europe about their unique roles and responsibilities. The question this time: “What one ongoing pro bono initiative or project or charity/volunteering project that your firm is involved with has the most meaning for you personally, and why?”