Part of a foreign entity, no registered capital required
A fast and easy way to create your branch
Conducting business via a branch (formerly known as "organizational units" under the Commercial Code) is one of the several ways a foreign entity can do business in the Czech Republic, thus eliminating the need to form a brand new company.
Setting up the branch, its management, and dissolution, requires less administrative work than you would have with the formation and management of a new company.
Benefits of a branch compared to a new company
- A branch is a part of a foreign entity. All transactions are therefore informal between the branch office and the foreign entity.
- No registered capital is required.
- The only legally required body that the branch must have is a director. The law places less strict requirements on the director than on a member of the statutory authority of a new company.
- There are no special requirements regarding the management of a branch; it is not necessary to hold general meetings etc.
- A branch can be easily dissolved.
YOU GET ALL THE FOLLOWING SERVICES
- The creation of a legal document regarding the decision to create a branch for a foreign entity.
- Representation at the Trade Licensing Office.
- Representation during the process of registration in the Commercial Register.
- Administrative fee – Trade License.
- Administrative fee – Commercial Register.
If you are interested in setting up a branch, simply fill out the form below. We will prepare all the required documents and set everything up for you within 14 business days.
Every branch is legally required to have a registered office.
FILL OUT THE FORM BELOW AND WE’LL GET IN TOUCH!
A branch is not a legal entity and it only acts legally on behalf of its incorporator. The incorporator is usually a foreign company or similar entity. The main benefit of a branch is the fact that you can do business in the Czech Republic without forming a brand new company, which would be a legal entity of itself. If your company already does business in Germany or Austria, for example, and you would like to expand into the Czech Republic, all you need to do is create a branch.
A branch can easily be identified in the Commercial Register. It is registered under the name of its incorporator with a “branch” addendum. Before changes to the Civil Code were made, branches were known as “organizational units”. All former organizational units are now known as branches.
The main benefits of a branch
The main benefit of a branch is that it can be created and dissolved quite quickly. And you don’t have to pay any registered capital when registering the branch in the Commercial Register. Opening a branch is therefore the ideal option for foreign legal entities who want to expand their business activities into the Czech Republic. Another benefit is that the whole incorporation process can be executed quite quickly; it only takes 2 to 3 weeks. To make the whole process as fast as possible, we recommend having all the required documents ready before starting.
Because a branch is not a separate legal entity, all transactions between a foreign entity and its branch are informal. There is no need for adjustment of any contracts, etc., because a branch is considered the same entity as the foreign body.
There are no strict laws on the management of a branch, so you don’t need to hold general meetings. When dissolving your branch, no liquidation is required, making dissolution quick and cheap.
The key person of a branch is its director
The only statutory authority a branch must have is its director. When compared to company bodies, the director doesn’t have many responsibilities. Usually, the director is responsible for the proper operation and compliance of the branch and he answers to the foreign entity. It is necessary that you choose your director wisely, as he will be responsible for all the business the branch conducts in the Czech Republic. The director’s name also has to appear in the Commercial Register.
By law, a director is authorized by the foreign entity to represent it in any and all matters concerning the branch in the Czech Republic. Therefore, the director may represent the branch at court, in front of other authorities, and during any administrative proceedings.
CREATING YOUR BRANCH TOGETHER WILL BE A BREEZE
Our experts have extensive experience in creating branches for foreign entities. We’ll manage the whole process for you, all the way from the creation itself, to registration in the Commercial Register. There are a few formalities you will have to perform, but we’ll manage them together. You will always know what the next step is and what needs to be done.
- For certain branches, it might be necessary to obtain a trade license.
- We’ll visit all the authorities in your place.
- We’ll prepare all the necessary documents.
- We’ll register your branch in the Commercial Register.
We are here to help and guide you through the whole process. Every situation is unique and might require a special process, depending on the circumstances (legal requirements of the given country, the intended business of the branch, etc.). For this reason, we can’t list all the circumstances here. It’s always best to summarize your situation and requirements and then go from there. Let’s get in touch and figure out exactly what you need.
What we’ll need from you?
- An excerpt from the Commercial Register of the company that will be creating the branch (the exact form depends on the legislation of the country the company is from).
- There may be other necessary documents. If so, we will advise you on what they are, why they are required, and we’ll help you obtain them (e.g. Articles of Association).
- An affidavit and specimen signature of the person who is to become the director of the branch.
- Possibly an excerpt from the Register of Criminal Records regarding the director.
- The consent of the foreign entity that is creating the branch and of the appropriate statutory authority, together with the branch’s registration in the Commercial Register.
- We will also need a power of attorney from you in order to represent you before the authorities.
As we mentioned previously, there are a lot of varying circumstances and requirements depending on your exact case. Let’s get in touch and figure out exactly what you need.
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