Does your business involve contracting with public entities?

20. June 2016

If so, then please do not forget the obligation in force from July 1, 2016, to publish the contracts made with public entities in the register of contractss newly established by Act no. 340/2015 Coll. providing for special terms of effect of some contracts, publication of such contracts and for the register of contracts (the Act on the Register of Contracts). The Act stipulates that all government and public institutions, regional self-government administrative units, state-owned companies, legal entities in which the state has a majority of ownership interest, or a regional self-government administrative unit and other institutions listed in the Act on the Register of Contracts are obliged to publish all contracts with the performance exceeding CZK 50,000 without VAT in the register of contracts. 

The publication of contracts in the register will be required for the contract to actually come into effect. If a contract is not published within 3 months following its execution, it will be null and void ex tunc. The contracts executed within the period of 01.07.2016 and 01.07.2017 must be also inserted into the register; however, the Act does not sanction a failure to meet this obligation by unenforceability/nullity of the contract concerned.

The Act on the Register of Contracts stipulates a number of exceptions from the obligation to publish. One example of such an exception are the contracts made with natural entities outside their entrepreneurial activity. However, if the subject matter of such contracts is a transfer of real property, the obligation to publish applies to these contracts as well, while it is expected that the number of exceptions will be subject to further extension.

The register of contracts is designed as a system accessible online administrated and operated by the Ministry of Interior. The register has not been activated yet but we are monitoring the situation and we will inform you once the system is ready to launch.