The winner of the ninth annual Act of the Year survey is the initiative for more prudent regulation of business, i.e. the ruling of the Constitutional court on electronic sales records (“EET”). The expert public’s votes ranked the Payment System Act implementing PSD2 second and the amendment to the Construction Act third. In this survey organised by Deloitte Legal, hundreds of entrepreneurs chose from five nominated legislative acts having a positive impact on business.
“The results can be summarised as follows: Adopt new regulations with more consideration. And try to use new regulations to encourage innovation and improve the business environment, not stifle it,”says Tomáš Babáček, chairman of the nomination board of the Act of the Year survey and Deloitte Legal’s attorney.
“It is not just about the EET ruling. The reason why this ruling was included in the nominations and why it obviously caught the attention of most voters was its broader message on how the state should regulate business (and not just business). When introducing a blanket regulation, the legislature must consider its impacts in advance. The saying that you cannot make an omelette without breaking eggs is not applicable to regulatory measures under the rule of law.”
Voting in various business areas
Most entrepreneurs that responded to the survey voted for the Constitutional Court Ruling on EET as did lawyers and tax advisors, the non-profit sectors and journalists.
“In a situation where many laws are adopted and there is no official electronic statute book, the Act of the Year survey is a very useful reaction of the expert and business public who evaluate newly adopted bills with respect to their positive or negative impact on the business environment in the Czech Republic. This year’s results showed very clearly that the business public welcomes steps that make business more effective, do not burden it with unnecessary regulation, allow innovation, increase the enforceability of rights and decrease administrative demands,” says Robert Němec, the Vice-Chairman of the Czech Bar Association, adding:
“Among other things, the winning ruling of the Constitutional Court also set limits for excessive state involvement in the private sphere as it cancelled the obligation to state the taxpayer’s VAT ID on receipts, since for natural persons this ID includes their personal identification number. The regulation of the business sphere must always comply with basic constitutional principles and respect fundamental human rights, such as protection of privacy.”
The dominating topic in the segment of industry, power and transportation was the fast-tracking of construction and the related legislative cut in the form of the amended Construction Act. The voters casting their votes through the Czech Chamber of Commerce concurred.
“Entrepreneurs have to face an increasing flood of legal regulations that rather than simplifying their business instead put obstacles in their way. It is therefore no surprise to me that entrepreneurs chose the Constitutional Court ruling as the Act of the Year. It is fully in line with the motto that we at the Chamber of Commerce have been promoting for a long time, which is ‘EET yes, but’. I am also pleased to see that the members of the Chamber of Commerce chose the amendment to the Construction Act as the Act of the Year. I do not think the amendment is ideal, but I believe it will lead to a significant simplification and facilitation of construction permits and the actual process of construction,”says Vladimír Dlouhý, president of the Czech Chamber of Commerce.
The majority of votes for the Payment System Act authored by the Ministry of Finance came, aside from the finance sector and the public sphere, also from trade and tourism.
The two remaining nominations in the survey did not attract so much attention. In certain business sectors they even received no votes at all. The non-profit sector was the only one that highlighted, aside from the winning Constitutional Court ruling, the need for more efficient court procedure connected to the amended Code of Civil Procedure. For comparison – last year’s winner was open data and the year before that, the contract register.
Complete results of the Act of the Year survey:
|1.||More prudent regulation of business (a Constitutional Court ruling on the electronic sales records)||37%|
|2.||Regulation stimulating innovation on the financial market (the Payment System Act implementing PSD2)||25%|
|3.||Legislative cut for fast-tracking construction (the Amended Construction Act)||18%|
|4.||More efficient and effective court procedure (the Amended Code of Civil Procedure)||13%|
|5.||Tax regulations reflecting business reality (the Amended Income Taxes Act)||8%|
The Act of the Year nomination board was composed of twenty authorities from various fields, not only business. This year’s survey was held under the patronage of the Czech Chamber of Commerce and the Czech Bar Association. Voting was done using an online questionnaire and physical ballots at the individual partners of the project.
The Act of the Year Project is accompanied by a web platform containing articles, comments and opinions of experts, subtitled Law for Business. Its aim is to provide space for voicing opinions intended for proposers of bills.
“The fact remains that entrepreneurs themselves have an essential influence through the way they are able to self-regulate and sufficiently mobilise themselves when formulating requirements on the quality of new legislation,” summarises Tomáš Babáček from Deloitte Legal.
More information about the Act of the Year survey can be found at www.zakonroku.cz.