Establishing Ltds to be Cheaper

Lowering the expenses incurred during the process of founding a limited liability company is one of the main aims of the Act on court fees amendment, which has been approved of by the Parliament and is to be yet debated by the Senate.The amendment deals with cases of a new company being formed by so-called direct entry into the Commercial Registry performed by a notary. The current legislation requires a fee of CZK 2,700 to which the notary's remuneration amounting to no less than CZK 4,000 (depending on the registered capital amount) needs to be added. The amendment, then, cancels the obligation to pay the fee if the document which establishes the company (i.e. the articles of association or memorandum) only contains the basic legal requirements.

This change, however, would not apply if the company founders decide to apply more complex agreement provisions, or if services of a notary are not to be made use of.

However positive this new scheme is, the company founders always ought to bear in their minds that an investment a more complex corporate documentation might be rather advantageous for future operation of the company as more detailed documents help control the conditions within the company and, in doing so, avoid unnecessary legal proceedings.