6 major challenges companies face when doing business in the Czech Republic

In today’s global economy, entrepreneurs and investors are finding numerous opportunities for doing business abroad. The Czech Republic, long known for attracting top multinational companies and talented workers, was in fact recently named among the world’s best countries for cross-border trade, and one of the easiest nations to do business in.

But while he believes that starting a company in the Czech Republic has gotten easier through the years, Vajda says there are still numerous challenges that come with the territory. “The Czech Republic continues to work on reducing bureaucracy and investing in the modernisation of its authorities and processes,” he adds.

Considering starting a business in the Czech Republic? These are the areas in which you can expect to face challenges, says Vajda, whose team of attorneys can also help you choose a suitable form of legal company and mediate compliance with legal requirements when you register your business in Czech Republic.

“Having an understanding of the Czech labour market, tax obligations, and the overall culture and business environment, all mean a significant starting advantage for the client,” says Michal Sniehotta, a partner of SNIEHOTTA & VAJDA LEGAL.

Though it may have gotten easier to start a company in the Czech Republic in recent years, with the law enabling easier procedures for setting up a company and lowering costs for registered capital, other provisions have become stricter. Namely immigration procedures which have in practice recently tightened as a consequence of the migration crisis, making it more difficult to obtain a longer-term visa for third-country citizens.

Like immigration law, there are still many obligations that companies must face on a monthly basis with regards to tax compliance, issues that can impede them from focusing exclusively on their business. “It isn’t easy to follow all the applicable rules and their changes without the external help of an attorney or a tax consultant,” says Vajda whose firm is comprised of lawyers as well as tax advisors who have previously gained extensive experience in leading Czech and international law firms and consulting companies.

When dealing with Czech authorities, it is typically necessary to have a translator or a native speaker on hand to assist, as many Czech officials don’t speak English. SNIEHOTTA & VAJDA LEGAL offers help and services in Czech, English, and Spanish. “We understand that communication in their native language is regarded by companies as a high added value,” says Vajda.

Investors or entrepreneurs will face numerous legal issues when establishing and subsequently launching and developing a business. During this period, it’s important to focus on the business itself, rather than legal issues, advises Vajda. “Many legal questions arise in the course of a company’s life and it’s ineffective for a business to cope with these issues individually,” he says adding that having local help makes things faster, more efficient, and comfortable. SNIEHOTTA & VAJDA LEGAL is familiar with all the necessary law obligations and has experience navigating bureaucratic procedures in the Czech Republic.

Vajda doesn’t see the challenges listed here as insurmountable. “In general, I would not anticipate any sort of fundamental legal objection for foreign companies,” he says. In his experience it’s minor issues that can cause unexpected problems. For example, looking for a work space in Prague can be difficult due to increasingly high rents and demand. SNIEHOTTA & VAJDA LEGAL can provide professional help and assistance with the aforementioned practical problems as well as tailor-made solutions for that wide range of legal issues.