Doing Business Without a Trade License in the Czech Republic

The Czech Trade Licensing Act

According to the Czech Trade Licensing Act (Act No. 455/1991 Coll.), business activity (a trade) is defined as a systematic activity carried out independently, under one's own name and responsibility, with the aim of generating profit, and under the conditions stipulated by this Act. The various professions requiring a trade license are listed in Annexes 1-4 of the Czech Trade Licensing Act. You can find general information in our article Steps for acquiring a Czech Trade Licence.

Under the Czech Trade Licensing Act (Act No. 455/1991 Coll.), trades are divided into notifiable trades (including the Czech Free Trade Licence with its specified fields of activities), which can be obtained based on notification, and concession trades, which require a special business license – a concession – to be pursued legally. Notifiable trades are further categorized into three groups: vocational, professional, and unqualified.

Notifiable trades are characterized by the fact that the authorization to trade becomes effective immediately upon notification (not upon the later issuance of the trade license certificate).

To illustrate the different types of trade: Trades categorized as vocational include carpentry, bakery and confectionary, bricklaying, brewing, etc. You can find the complete list of vocational trades in the Czech Republic here. Professional trades include activities such as providing or brokering consumer credit, work as an optician, or trading animals.

To acquire a concession for concessionary trades, it is necessary to demonstrate the relevant professional eligibility and, in some cases, meet additional requirements. Trades requiring concessions include operating a travel agency, road freight transport, or a security firm protecting other people’s property.

Individuals or entities seeking a Czech trade license for a notifiable trade can obtain one by notifying the trade. Applicants for a concession must submit an application. Both notifications and applications can be submitted at any general Trade Licensing Office (central registration points), through government administration contact points (Czech POINT), or electronically via the Trade Register web system. Trades are notified, and applications for concessions are submitted, using a standard registration form. These forms can be obtained at any trade office and are typically available for download from the Ministry of Industry and Trade website for natural persons and for companies (note: forms must generally be completed in Czech).

List of Activities Not Classified as Trades in the Czech Republic

Section 3 of the Czech Trade Licensing Act details activities that are not considered trades under this specific legislation. Paragraph 1 of this Section lists five such activities:

a) The performance of an activity statutorily reserved for the State or for a designated legal person,

b) The use of the results of intellectual creativity protected by specific laws, by their originators or authors,

c) The collective administration of copyright and rights related to copyright in accordance with specific legislation,

d) The restoration of cultural monuments or parts thereof which are works of fine art or applied art,

e) The performance of archaeological research.

These activities are primarily regulated by other specific laws. For example, activities related to copyright are governed by the Czech Act No. 121/2000 Coll., the Copyright Act.

Activities of Natural Persons Governed by Special Acts

Furthermore, the Trade Licensing Act specifies that the professional activities of certain natural persons, when carried out under the scope of specific dedicated laws, are not considered trades. Examples include:

a) Doctors, dental practitioners, and pharmacists, paramedical workers in the provision of health services, and natural healers,

b) Veterinary surgeons, other veterinary workers, including rendering workers and persons performing professional activities related to selection work and the breeding of livestock,

c) Lawyers, notaries, patent attorneys, and bailiffs,

d) Experts and interpreters,

e) Auditors and tax consultants,

f) Stock jobbers,

g) Mediators and arbitrators in collective bargaining disputes, and arbitrators in property disputes,

h) Officially licensed surveyors,

i) Authorised architects and authorised engineers active in construction who engage in activities as freelance architects and freelance engineers,

j) Authorised inspectors who engage in their activities as a liberal profession,

k) Road safety auditors,

l) Mediators registered under the Act on Mediation,

m) Mediators registered under the Copyright Act.

Other Activities Excluded from Trade Licensing

Additionally, the following activities are explicitly excluded from being classified as trades under the Trade Licensing Act:

a) Banking activities, providers of payment services, issuing electronic money, operating payment systems with irrevocable settlement, currency exchange activities, activities of dynamic currency exchange service providers, insurance activities, reinsurance activities, insurance brokers or accredited persons according to the Act on Insurance and Reinsurance Distribution, pension funds, pension companies, savings and loans societies, commodities markets, organisers of regulated markets, securities traders and their bound representatives, the activities of persons involved in the management or administration of an investment fund or foreign investment fund, the activities of persons providing settlement of trades in securities, the activities of persons accepting and giving instructions or investment advisory activities relating to investment tools under the conditions set forth in a special Act and their bound representatives, activities of crowdfunding service providers, the activities of credit rating agencies, the activities of providers of reporting services, the activities of accredited persons according to the Act on Capital Market Undertaking, provision and intermediation of consumer credit, and the activity of accredited persons under the Act on consumer credit,

b) Operating games of chance,

c) Mining and other activities using mining techniques,

d) The generation of electricity, the production of gas, the transmission of electricity, the transmission of gas, the distribution of electricity, the distribution of gas, the storage of gas, trade in electricity, trade in gas, the production of heat and the distribution of heat, which are subject to a licence under specific legislation, and brokerage activities in the energy sectors,

e) Agriculture, including sales of unprocessed agricultural products for the processing or resale thereof, with the exception of professional phytosanitary care,

f) Sales of unprocessed plant and animal products from natural persons’ internal small-scale cultivation and breeding,

g) Maritime shipping and sea fishing,

h) The operation of railways and rail transport,

i) The performance of communication activities in accordance with specific legislation,

j) Research, production and distribution of medicinal products,

k) The handling of addictive substances, products containing them, and certain substances used in the production or processing of addictive substances under a specific law,

l) The activity of authorised or accredited persons and notified bodies in the field of state testing,

m) Foreign trade in military material,

n) The performance of labour inspections,

o) Radio and television broadcasting,

p) The offer or provision of services for the direct gratification of sexual needs,

r) The intermediation of employment,

s) The operation of technical inspection centres,

t) Education and training in schools, preschool and educational establishments included in the register of schools and educational establishments; education in bachelor, master and doctoral studies; and lifelong learning programmes in accordance with specific legislation,

u) The handling of substances included in list 1 in the Annex to the Convention on the Prohibition of the Development, Production, Stockpiling and Use of Chemical Weapons and on their Destruction,

v) The operation of airports, the operation of commercial air transport and aeronautical work, the provision of air services, the activity of executive pilots, the implementation of professional training in the field of civil aviation protection against illegal acts, and the operation of an unmanned system by a holder of an authorization to operate unmanned systems or light unmanned systems in a specific category of operation,

x) The activities of organisations set up under specific legislation conducted in accordance with the purpose for which they were established,

y) Child protection by legal and natural persons, if authorised to provide child protection under specific legislation,

z) The prospecting, exploration and extraction of mineral resources from and beneath the sea bed and the ocean bed beyond State territorial limits,

aa) The operation of cemeteries,

ab) The activities of authorised packaging companies in accordance with specific legislation,

ac) The handling of high-risk and risky biological agents and toxins,

ad) The operation of zoological gardens pursuant to a licence issued by the Ministry of the Environment,

ae) Archiving,

af) The provision of social services in accordance with specific legislation,

ag) The activities of authorised persons entitled to verify professional competence required to obtain a certificate of a professional qualification under a specific law,

ah) The letting of property, residential and non-residential premises,

ai) The provision of health services,

aj) The performance of professional plant health care activities in accordance with specific legislation,

ak) Operation of postal services and foreign postal services pursuant to a special legal regulation,

al) The performance of the expert activities of experts, expert offices and expert institutes,

am) The activities of the operators of collective systems pursuant to the Act on end-of-life products and the Act on limiting the environmental impact of selected plastic products.

Regulation by Other Czech Acts

It is crucial to understand that while the activities listed in Section 3 of the Czech Trade Licensing Act do not require a trade license under that Act, they are still regulated activities governed by other specific Czech laws. These laws often impose different obligations, registration requirements, or licensing procedures. For instance, according to the Copyright Act, a collective manager must apply for authorization from the Ministry of Culture to perform collective management. Similarly, while agriculture (excluding professional phytosanitary care) is not a trade under the Trade Licensing Act, Czech Act No. 252/1997 Coll., the Act on Agriculture, stipulates an obligation to register as an agricultural entrepreneur if certain conditions are met. Therefore, engaging in any of these activities requires careful review of the relevant specialized legislation.

For more information, please contact:

JUDr. Mojmír Ježek, Ph.D.

ECOVIS ježek, advokátní kancelář s.r.o.
Betlémské nám. 6
110 00 Prague 1
e-mail: mojmir.jezek@ecovislegal.cz
www.ecovislegal.cz/en

About ECOVIS ježek advokátní kancelář s.r.o.
The Czech law office in Prague ECOVIS ježek practices mainly in the area of Czech commercial law, Czech real estate law, representation at Czech courts, administrative bodies and arbitration courts, as well as Czech finance and banking law, and provides full-fledged advice in all areas, making it a suitable alternative for clients of international law offices. The international dimension of the Czech legal services provided is ensured through past experience and through co-operation with leading legal offices in most European countries, the US, and other jurisdictions. The Czech lawyers of the ECOVIS ježek team have many years of experience from leading international law offices and tax companies, in providing legal advice to multinational corporations, large Czech companies, but also to medium-sized companies and individual clients. For more information, go to www.ecovislegal.cz/en.