Better regulation of business environment in the Czech Republic 4th of April, 2019

Reducing administrative burden on entrepreneurs; its brief history, fulfilling the plan and future The government of the Czech Republic has been constantly reducing the administrative burden of entrepreneurs since 2005. Ministry of Industry and Trade is responsible for reducing administrative burden on entrepreneurs. In 2007 a Plan on reducing the administrative burden of entrepreneurs was firstly adopted by the Government. It ordered 6 most involved ministries to take steps that they set themselves in order to reduce the administrative burden. The original goal was to reduce the administrative burden by 20 % by the end of 2010. Then this Plan was extended to 25 % till the end of 2012. This Plan was fulfilled in 2012 as the burden was reduced by 32 % according to the Report on reducing the administrative burden on entrepreneurs 2013. The Government is being annually informed through the Report containing information about the current burden situation. Related to the Europe´s goal, the administrative burden should be reduced by 30 % until the end of 2020.

The measures We changed our focus from using percentage to aiming on number of measures for better understanding of the outline. We newly stopped dividing the burden according the departments. We achieved a success especially in simplification of the process of establishing a company. We are now focused on 40 measures planned to be fulfilled by 2020. There were already implemented 18 measures. For the measurement, a Standard Cost Model is used – the link is available on our website (SCM represents a practical guide for staff working in administration on how to assess the burden)

The Expert Group The Expert Group consists of representatives from business associations (the most important: Czech Chamber of Commerce, Association of Small and Medium-Sized Enterprises and Crafts, Confederation of Industry and Transportation of the Czech Republic, Czech Confederation of Commerce and Tourism) The members meet several times per year. The concept of six-month rotating presidency was implemented and individual members of the Expert Group perform the role of the rotating chair. This Group deals with concrete suggestions made by entrepreneurs that affect them the most (the most problematic areas according to the entrepreneurs involved: law issues containing lots of changes or amendments, statistic reporting, tax related issues, sharing data among administrations, duplicity and environmental issues) There is a link for entrepreneurs where they can publish their opinions regarding the regulation – www.zjednodusujeme.cz (represents another way of how to make suggestions) There was added a presentation about this topic from one of the members (AMSP).

Systemic measures Lowering the amount of legislative changes – it contains Single effective date – the goal is to unify the effective date and to make them more simple towards entrepreneurs. They would come into force only twice a year (1.1. and 1.7.). Regarding the new legislation - there should be a minimum space of 3 months for entrepreneurs to be prepared for a new law Better regulation – specific economic narrower assessment of impacts of proposed regulation that come from Chamber of Deputies, Senate or Higher ground administration entities. It would be also related to the European transposition norms without the possibility of discretion. The assessment of the usefulness of newly accepted laws could be provided via so-called Ex post RIA. We would like to use more of this possibility in the future. Principle „One-in, minimum One-out“ – in case of establishing a new duty, another old one with similar impact on entrepreneurs has to be cancelled We would also like to see the creation of similar working groups at the other ministries as we have now at the Ministry of Industry and Trade

The Achievements in the area of digitalization processes of services for entrepreneurs These issues have been successfully resolved or are still in progress: Trade Register – creating of single registration form known as One stop shop platform. It is still being modernized and it is connected to Trade Act maintained by the Ministry of Industry and Trade (Citizen portal). It includes establishing a new company as well as interaction with Tax Office (paying taxes, charges etc.) BusinessInfo portal – it represents a portal for entrepreneurs with all of the forms that they need for their business activities. There is more than 1400 of them. The goal of the tool is to have a 100 % interactive view. Projects eCollection and eLegislation – This is one of the projects of eGovernment. It represents the availability of all of the law regulation for both entrepreneurs and public online. Entrepreneurs have their own specific setting. PES – law electronic system – following on the next slide

Law Electronic System Is abbreviated as „PES“ in the Czech Republic. The system is currently being tested and is about to be launched in a few months. Chamber of Commerce is responsible for this project. The Ministry of Industry and Trade cooperated on the version of the system during its development. The system is related to the Trade Act and was developed in order to help entrepreneurs with the orientation in the legislative and regulatory part of their business. The Ministry of Industry and Trade will encourage other departments to cooperate. There are 2 packages currently available: - Basic (deals for example with taxation or health and social insurance) and - Employer (deals with the Labour Code, employee payments etc.)

The „Top 10 key points for entrepreneurs“ by the Ministry of Industry and Trade (You can see the whole material on your table) This material describes Top 10 key points aimed on entrepreneurs that influence them the most and offers either a solution or a simplification Here are some of the most significant issues set in the document: Controlling web (calendar with controls) - this measure changes the approach of official authorities to controls, reduction of time and administrative burden, sharing documents among authorities. There should be a maximum of 5 controls per year and a minimum space of two months between two controls. Simplification of establishing of business through the connection between the Business register and the Citizen portal Cultivation of business environment and support the smallest entrepreneurs as well as redefining the term „family business“. This also includes support of these enterprises and support of rural business activities Simplification in dealing with documents during construction process - This represents supporting a pro-client approach of Building Authorities. Assessments during building permit procedure are not performed by entrepreneurs, but by Building Authorities Employers with the employees in execution; We would like to create a new deductible item, which would deal with the costs of employers on the employees having execution(s). (based on the establishment in the Income tax)

Conclusion Digitalisation of services for entrepreneurs and sharing data among official institutions (only once) Making current legislation clearer (with the assistance of RIA) - Creating the friendliest conditions in dealing with new legislation Principle One-in, minimum One-out – This principle should lead to avoid raising administrative burden Effective micromanagement – GTD „Get Things Done“ – fulfilling concrete points We are preparing a new plan in the outlook 2019 – 2022 Deep audit of all of the duties; A new re-measurement of the administrative burden on entrepreneurs will be done in 2021

Thank you for your attention I hope I raised your interest in the regulatory environment in the Czech Republic Here are some contacts: Mr. Petr Kleisner, kleisner@mpo.cz Mrs. Zuzana Galajdová, galajdova@mpo.cz Mrs. Veronika Paulová, paulova@mpo.cz – the Head of the Unit Mr. Pavel Vinkler, vinkler@mpo.cz – the Director of the Department