In response to the COVID-19 epidemic and the crisis measures, on 31
March 2020 the Ministry of Justice submitted a bill on Certain Measures to
Mitigate the Effects of the Covid-19 Epidemic on Litigants, Victims, Victims of
Crime and Legal Persons and on Amendment of the Insolvency Act and the
Execution Code (hereinafter referred to as the “Act”).
What are the proposed changes concerning legal entities?
Decision-making by bodies of legal entities - simplification and enabling distance decision-making
- The body of a legal entity may make decisions outside the meeting in
writing or by technical means (the meeting convened in a timely and proper manner using distance
communication – e.g. Skype, Microsoft Teams, WebEx, etc.), even if the
founding legal act does not allow it.
- If
the law or the founding legal act does not stipulate the conditions of
decision-making, in the case of the highest body it shall be determined by the
statutory body, in the case of another body the conditions shall be determined
by this other body itself.
Members
of elected bodies – the term of office
- If
the term of office of a member of the elected body of a legal entity expires
after the effective date of the Act during an extraordinary period or within 1
month after its expiration, his term of office shall be automatically
extended until 3 months after the expiry of the emergency measure within
the COVID-19 epidemic.
- If a member of an elected body delivers an opposition to the extension
of the term of office before the expiry of his term of office to a legal
person, his term of office shall not be extended.
- The
law allows for so-called co-optation even if it is not permitted by the
founding legal act.
- If
the term of office of a member has elapsed between the day of the adoption
of an emergency measure within the COVID-19 epidemic and the day of
entry into force of the Act and a new member has not been appointed, the
member's function may be renewed; however, the member must agree.
The function will be restored within 3 months after the end of the emergency
measure during the COVID-19 epidemic.
Discussion of financial statements - extension of deadline
- If
the statutory period of time for discussing the regular financial statements
of a limited liability company, joint stock company or cooperative should
expire less than 3 months after the end of the emergency measure in the COVID-19
epidemic, it will expire 3 months after the end of this measure, but no
later than 31 December 2020.
We will be happy to discuss the specific impacts of individual proposed changes to the law on your business and the possibilities of applying them in practice.
Authors: Karel Nejtek a David Fabián
