Current Affairs EU directive helps Czechs provide cross-border services

Tomáš Bartovský The Czech Republic has adopted a new law which makes it easier for companies and individuals to provide various services in other EU countries. From now on, all Czech builders and other skilled workers need is a licence from their own country – they no longer have to get a permit in the country where they wish to do business. Tomáš Bartovský is the spokesman for the Czech Ministry of Industry and Trade.

“The main goal of the new law is to remove legal and administrative barriers and to simplify procedures in the services sector. It covers many particular areas; however, it does not apply to several types of services, such as social services, health care, transportation or telecommunications services. These are regulated by other legislation.”

Based on a 2006 EU directive, the law enters into force here on Monday, and should soon apply across the whole bloc. Mr Bartovský says that a network of contact points has been set up where Czech entrepreneurs can receive detailed information.

“Establishing a business should be less complicated in the EU and the Czech Republic. Companies will be provided with all necessary information about establishing businesses. Also, the procedures will be simpler. Second, providing cross-border services should also be easier. This means that companies will be able to supply services across borders in other member states without having to set up establishment there.”

Illustration photo When the Czech Republic joined the European Union in 2004, some of the old member states, particularly Germany and Austria, insisted on restricting free movement of services from the new members. This exception will be in place until 2011, and the new law therefore only applies to “temporary and occasional” services. Bedřich Danda is the head of the Czech Entrepreneurs Association.

Bedřich Danda “This law is certainly a step in the right direction because it makes conditions for doing business more liberal. The question is how much it will be used; we suppose it will be used mainly in the border areas because travelling costs and generally the costs of setting up businesses abroad are very high. So we believe it will particularly used in borderland areas.”

The new law introduces what is known as “silent approval”. Whenever the authorities fail to reply to a request within a certain time, the request will be considered approved. The new legislation also works the other way, enabling companies and individuals from other EU countries to work in the Czech Republic.