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Czech Business Today volume VIII, 4-2009

CEBRE – Czech Business Representation, protects the interests of the Czech business community News Flash in relation to EU institutions, informs Czech businesses about EU legislation affecting them, trains Czech entrepreneurs in Brussels and represents Czech business associations at European business Communication with Public Offices federations. Contact: Czech House, 60 Rue du Trone, 1050 Brussels, Tel: +32 2 2139 450/2, e-mail: Only Electronically [email protected], www.cebre.cz On 1 July a new law on electronic acts and the authorized conversion of documents went into The End for Czech Presidency, effect. The aim is to ensure the correspondence between legal business entities and state au- the Beginning for MEPs thorities via a system of electronic “data boxes” mandatory from 1 November. June meant the close of the ’s the previous term. The number of Czech political Presidency of the Council of the European Union. parties represented in the European Parliament Despite unexpected turbulence in Jan Fischer’s also dropped – from its previous number of eight to State is Number One Debtor caretaker government, the Czech Republic ma- four: ODS, ČSSD, KSČM and KDU-ČSL. Czechs On the ladder of non-payers, according to com- naged to close out its presidency passing 84 Eu- are represented in the leadership of the Progres- mercial research carried out in spring 2009, the ropean regulations and other pieces of legislation. sive Alliance of Socialists & Democrats group and state takes first place among all debtors in the For some this marks the end, but for others it’s just also gained a vice-chairmanship on the Industry, Czech Republic. Three-fourths of Czech com- the beginning. In June, Czechs voted 22 MEPs for Research and Energy (ITRE) Committee. panies are affected by debts and late payments. another five-year term – two MEPs fewer than in (continued on page 2) Czech businesses welcome revisions to the EK concerning late payments, which was presen- A Question for ITRE Committee ted in April. Vice-Chairman Evžen Tošenovský Mr. Tošenovský, you were just voted vice-chair- should be used where Cancellation of Vehicle Log Books man of the Committee on Industry, Research an excess of unused The operation of business vehicles will be che- and Energy (ITRE), which issues would you most materials remains and aper and require less paperwork. In July, the like to dedicate your time to? where the conditions for Czech Senate passed a bill on taxes and fees The ITRE has a wide breadth of activities, which is what their use is beneficial. We Evžen Tošenovský which cancels the obligation of companies makes it such an interesting committee. In the near should manage the use of renewable energy sources to keep vehicle log books for the purpose of future, the ITRE will focus on the effects of the world with the economy in mind and not use them just to use showing expenses associated with the use of economic crisis and how do deal with them. Another them. The same goes for the system of trading emis- company-owned vehicles. very important issue is energy. The natural gas crisis sions allowances. Another priority issue for me is the at the beginning of this year showed us just how im- relationship between science and research with respect portant the diversification and use of alternative energy to universities–combining theory with practice. Wise Unemployment Rises, sources are. I think that renewable sources of energy economics is the best prevention for economic crisis. Government Takes Measures In July, the level of unemployment in the Czech Long-term solutions lay in R&D and knowledge economy Republic grew to 8.4%, up from 8% in June and Economic perspectives of the EU are the worst in the up from 5.3% year-on-year. To combat rising post-war era. According to the Commission‘s spring unemployment, the Czech government is redu- forecast, GDP growth is to contract by 4% in 2009 cing employers’ required contributions to social and the unemployment rate may increase to 11% in security from August 2009 to December 2010. 2010. EU countries are taking extensive measures to mitigate the impact of the crisis. The fiscal stimulus CEBRE breakfast held on 17th June in Brussels in the economy corresponds to 5% of EU GDP in tainable public finances, burdensome regulation and CONTENT 2009-10 (including automatic stabilisers). With signi- protectionism. In June, CEBRE organized a debate CZ PRES results – page 2 ficant cuts in key rates by the ECB and bank rescue to evaluate the EU and national measures combating plans in 19 countries (€300 bn in recapitalisation ope- the financial and economic crisis. Participants agre- Energy – page 3 rations and €3 tln in bank guarantees), the support is ed that spending on R&D and knowledge economy Economic crisis – page 3 very important. The biggest threat at present relates seem to be the key solutions to the crisis. Events – page 4 to persistent troubles in the financial sector, unsus- (continued on page 3)

The Confederation of Employers’ and Entrepreneurs’ Associations of the Czech Republic, funding member of CEBRE, is an independent, voluntary and open lobby group promoting and coordinating entrepreneurial, employer and professional interests in negotiations with Parliament, government, public administration and trade unions. Contact: Václavské náměstí 21, 113 60 1, Czech Republic, Tel.: +420 222 324 985, Fax: +420 224 109 374, Email: [email protected] www.kzps.cz 2 September 2009 Talking about… CZ PRES

The Czech Republic has six difficult months ...Czech Presidency Results behind it. It was a big test for the new kid on Even though the Presidency officially ends in June, the changing of the governing chair in May the block and reports on how it performed is usually considered to be the end of the presidency. So what was the Czech Presidency able to have been varied. In any case, for the Czech achieve in four months, and how did the Czech Presidency perform on its priority issues? Republic it was a challenge on all levels – administratively, logistically, financially and Economic Crisis time, it pushed through the passing of procedures with even in terms of its perception in the me- The Czech Presidency defended the principles of a com- respect to an “energy package” that removes barriers on dia. And because the pictures of politicians mon market and strongly fought against protectionist the internal gas and electricity markets. It also contributed painted by the media don’t always tell the practices while supporting the efforts of the Commission to an agreement on procedures on emergency supplies whole story, we bring you our view of how to decrease bureaucracy. It reached agreement on parts of oil and the speeding up of the revision of procedures the Czech Republic performed in specific of a plan of European economic renewal with respect to on natural gas reserves. It negotiated a statement by the areas. To what level was the Czech Presi- the Union and designed support projects in the areas of EU with Turkey, Azerbaijan, Georgia and Egypt which dency able to handle the issues it set as its energy and wide-band Internet as well as investigations would contribute to the future diversification of sources priority issues? The three “Es“, which rep- into the state of common agricultural policy (the Five-bil- of energy and energy pipelines. With the EP, it agreed on resent the Economy, Energy and External lion Package). It supported the lowering of VAT rates for labeling low energy consumption products that are better relations were extended to include two “Gs“ certain services and the speeding up of the reception of for the environment with the CE symbol. – Gas and Gaza. The unexpected crisis in the Gaza Strip and the interruption of gas 84 European Regulations and Legislative Bills „ supplies from the Ukraine in first months “ of the year were the first test, but definitely support for the requalification of workers, raising lending External Relations not the last. It was also necessary to deal funding from the IMF by € 75 billion and the possibility of The Czech Presidency represented the EU during the with the effects of the world economic and increasing the limits on the amount of assistance to mem- armed conflict in the Gaza Strip and started the Eastern financial crisis within the EU and at home. ber states outside the Eurozone to € 50 billion. It was able Partnership Initiative. It pushed though the signing of an Following the financial and economic crisis, to push though common guidelines for the stimulation of agreement with Canada on safety in private aviation as there was a political crisis at home. the automobile industry and was able to sign an agree- well as began proceedings on a complex agreement on ment with the EP concerning legislation on cosmetics economic partnership with Canada. It also sped up the and pesticide packages as well as a decision on partici- proceedings on an agreement with South Korea on free pation in a European meteorological research program. It trade. The Czech Presidency also signed agreements also contributed to the passing of acts on requirements on economic partnership with central Africa and with The Czech Presidency in Numbers for the approval of types of motorized vehicles concerning the Southern African Development Community. In addi- During the Czech Presidency, 2400 pro- basic safety and the simplification of the third and sixth tion, the Czech Republic reached an agreement among ceedings and 38 sector councils took place procedures in the area of EU law and signed an agree- member states on a mandate for the full liberalization of in Brussels and Luxemburg as well as two ment between the EU and South Korea on cooperation the trade of agricultural products with Switzerland. European Councils. There were also 14 in- in the case of anti-competitive proceedings. formal councils, 10 bilateral summits and 3000 accompanying events. The result was Energy the passing of 84 regulations and pieces of The Czech Presidency was also able to solve a bitter legislation. The Czech Presidency cost ap- commercial battle between the Ukraine and Russia and proximately 1.9 billion CZK (€ 70 million). renew the supply of natural gas to Europe. At the same

The End of the Czech Presidency, the Beginning of a Five-Year Term of Office (continued from page 1) During the formation of the new European Parlia- tative from KSČM, and two MEPs from KDU-ČSL Czech Ambassador to the EU Milena Vicenová had ment, Czechs participated in the birth of a new fac- remained in the EPP. During the naming of commit- a hard time during CZ PRES tion, the Conservative and Reform party which was tee posts, the new ECR group received better than Lisbon joined by nine MEPs from ODS. The Progressive Al- expected results. Proof of this was in the naming The Czech Presidency on the basis of an EU agreement liance of Socialists and Democrats in the European of Evžen Tošenovský (ECR) to the position of vice- from December of 2008, negotiated for Irish citizens on Parliament – S&D – has seven MEPs from ČSSD, chairman of the Committee on Industry, Research guarantees passed at the July meeting in the areas of the United Green Left/Nordic Green Left European and Energy (ITRE). One of the 14 other vice-chair- taxes, social security and neutrality, which would enable Parliamentary Group (GUE/NGL) has four represen- manships was awarded to Libor Rouček from S&D. the Irish government to hold another referendum.

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What to expect in How Czech Companies the energy sector from Brussels in are Weathering the Crisis the autumn From the end of last year, revenue of Czech companies • Motivate companies that maintain the same number has fallen by almost 28%. The average official num- of employees from year to year. ber of employees has also fallen by 20%. Czech busi- • Raise the employment level of handicapped and dis- It may seem that after the adoption of two energy nesses are also suffering due to the lending policies of abled persons and support socially aimed business packages (climate and liberalisation) the energy banks and the inability to repay their loans. The passing (social economics). sector may have a calm autumn without any new of anti-crisis legislation is also complicating the current Support export legislation or changes. This, however, is not the political situation at a time when the Czech Republic • Raise the allocation of financial tools to support ex- case. European institutions will specifically discuss is preparing for early parliamentary elections and Jan port. the proposal of the new directive about industrial Fischer’s caretaker government has a limited mandate • Meet farther in advance and better coordinate with emissions, regulation about the notification of the for making important decisions. Despite this, the gov- businesses on the range of conferences and trade investment projects in the energy sector (or the ernment has still been able to pass some bills. Among shows for which they can receive state support. so-called energy efficiency package) at the sec- them are anti-crisis measures in the area of taxation, Construction ond reading. For the countries with an energy mix such as quick write-offs, the institution of VAT rebates • Maintain a pro-investment approach by the govern- based on coal, the most dangerous may be the on personal automobiles, the lowering of contributions ment to further investment into building infrastructure. new directive on industrial emissions. If the pro- to social security by one percent and the increase of • Legally determine whether payments on invoices posal is adopted without any modification to its the guarantees from the state insurance company from the side of public investors are paid within one new emission limits, it can have a huge impact on EGAP as well as the Czech-Moravian Guarantee and month. the energy sector since some of the coal power Development Bank. Businesses are still missing infor- • Strengthen the transparency in public tenders and en- plants will have to be shut down and new energy mation on the existing measures as well as information force the business terms and conditions with profes- resources replacing them will have to be put into about their effectiveness. This is why the government sional organizations. service. The other proposal – regulation on noti- is recommending a new line of anti-crisis measures. Healthcare fication of investment projects – will have, on the Businesses are calling for an improved stance for cred- • Continue with pension and social reform as well as the other hand, more administrative impacts and, if itors and better collection rights, the lowering of the reform of healthcare. unmodified, it could constitute a disproportion- administrative burden (especially for small and medium • Establish the conditions for the expansion of commer- ate burden for energy companies. Therefore, this sized businesses), the relaxation of the controls and cial health insurance. proposal should also be carefully followed by the pressure from state institutions and the overall simpli- Agriculture and hinterland development industry. Equally important is the energy efficiency fication and increased efficiency during the application • For the years 2010-2011, lower dairy quotas in the package and its negotiation. All these facts show process for EU funds. EU -27 by 5%. that, with regards to energy, this autumn will be • From 2010, create common agricultural policies in the as active as last year’s. In addition, we must not Employers Dream anti-crisis plan Czech Republic within the dairy protection fund. forget the implementation of the climate package, Taxes • Ensure by 2013 the same conditions among old especially the emissions allowances directive, and • Continue with reform of the tax system and markedly and new member states, especially concerning the the third liberalisation package. Hopefully for the simplify tax legislation and tax collection. amount of direct payments. energy sector, the legislature will act rationally. • Allow suppliers to apply for VAT refunds from the state Energy Enjoy reading, for unpaid deliveries. • Put the finishing touches on a national energy con- Zuzana Krejčiříková, • Lower the VAT rate for continuing education. cept that will take into account January’s natural Director European Employment gas crisis. Affairs, CEZ • Continue amending labor law with an aim to raise its • Avoid any negative changes to legislation that affect flexibility and simplicity. the mining industry.

ROPE, the main challenges ahead are to fix financial sector problems, address risk unemployment, limit How to combat crisis the propagation of the crisis in vulnerable countries (continued from page 1) and restore confidence in public finance. Fabian Measures to combat the crisis have been taken helped to alleviate the adverse effects of the slump. Zuleeg of European Policy Centre pointed out we within the European Economic Recovery Plan Member State actions mainly focus on addressing have to prepare for long-term policies - structural (EERP) proposed by the European Commission the situation in the labour markets and supporting reforms, improved public finances, investment in and agreed on by the last De- household income. Others aim at supporting busi- R&D and a green, knowledge economy. That is why cember. Member states implemented the EERP via ness confidence and boosting investment. On the the short-run rescue measures must be temporary. their National Economic Recovery Plans (NERPs). other hand, the representative of the chamber net- “Once the crisis is over, they should disappear,” What progress has been achieved at both EU and work Giovanni Campi stated that NERPs are lack- stressed Jaroslav Zajicek from Czech Permanent national levels and how efficient are the measures? ing the ’smart’ investment in R&D, innovation and Representation to the EU. Speakers agreed that According to Alexandr Hobza of the European Com- clean technologies which was announced sincerely more consistency and better coordination of ac- mission, the measures already put in place have in the EERP. For Marc Stocker of BUSINESSEU- tions across the EU are needed.

The Confederation of Industry of the CR, funding member of CEBRE, is a non-governmental, voluntary federation of employers and entrepreneurs in the CR that represents and defends their interests in the in social diualogue and provides its members consultation and information focusing on international relations, trade opportunities, production cooperation, legislation, collective bargaining, European integration, education and training. Contact: Lighthouse Vltava Waterfront Towers, Jankovcova 1569/2c, 170 04 Prague, CR, Tel.: +420 234 379 488, Fax: +420 234 379 489, Email: [email protected], www.spcr.cz 4 September 2009 What You Shouldn’t Miss Events

CEBRE Business Breakfast on Late Payments Roundtable Discussion Czech Street Party September 30, on Business Education – Closing Ceremony CEBRE in cooperation with Czech Permanent Rep- On 25 and 26 July, a conference of the Czech Czech Street Party came on July to the city for resentation to the EU is organizing a Business Break- Presidency organized by the Ministry of Education, a third time, bringing again the best of Czech rock fast on Late payments held in the Czech House in the Ministry of Industry and Trade, and the European music, Czech Beer, Moravian Wine, local special- Brussels (60, Rue du Trône) on September 30th 2009 Commission on business education was held in ties and more. The event closes the cultural pro- from 9:30 am. How can you ensure that other stake- Prague. Three-tenths of the representatives of the gram of the Czech EU. Party was organized by the holders - businesses and consumers - pay accord- education and economic ministries from Germany, Czech Permanent Representation to the EU. ing to contractual and legal deadlines? Are there any Austria, Hungary, Poland, and the Czech Republic other alternatives to ensure the payments, such as as well as representatives from the European Com- better procedural provisions? mission, representatives of employers (BUSINES- SEUROPE, EUROCHAMBRES), labor unions and Meeting of the Economic Chamber CEDEFOP were in attendance. Business education and Members of the European Parliament was discussed by Czech students, teachers and October 14, 2009 businesses at three parallel round table discussions. Delegation of chamber’s representatives and busi- JA-YA Europe and JADE also actively participated nessmen will meet with the members of five key in the debate.

political groups of the European Parliament on Czech Street Party in Brussels on June 26, 2009 14 October where they will have an opportunity to talk one-on-one with Czech MEPs. This meeting was CEBRE presented the Czech Republic organized by the Czech Chamber of Commerce to- to 200 EU officials gether with CEBRE. The goal of the meeting will be to The European Commission in cooperation with CE- raise awareness for the chamber’s network within the BRE held a lunchtime conference on June 23rd to European Parliament and to acquaint MEPs with the present the Czech Republic. The event titled “Un chamber’s interests for the EU’s next session as well Etat membre à la une - la République tchèque” drew as meet with new members of the EP. the attention of 200 EU officials. Representatives Debate on Entrepreneurship Education at MŠMT in Prague on June 25 and 26, 2009 of Czech regions – Karlovy Vary, Plzen, Vysocina, EHSV Seminar for Young Business People Praha, Olomouc and Zlin informed the participants November 19-20, 2009 CEBRE debate: How do we handle about their regional particularities. The CzechTour- The European Economic and Social Committee the economic crisis? ism agency gave an general presentation of Czech will hold a seminar on 19 and 20 November in CEBRE in cooperation with Czech Permanent Rep- history, geography and culture. Pilsner Urquell beer Brussels for 20 young business people from the resentation to the EU organized a debate about and Karlsbad Becherovka liquor helped to create EU entitled: “How to Make Your Voice Heard in Economic Recovery Plans assessment on June an informal atmosphere. European institutions”. 17th 2009. The aim of the debate was to assess the implementation of measures agreed upon in the Policy Café on Consumer Rights European Economic Recovery Plan and their inter- November 11, 2009 connection with measures put in place by National CEBRE is organizing a Policy café on Consumer Economic Recovery Plans. Participants agreed that Rights in the European Parliament in November. The spending on R&D and knowledge economy seem goal is to discuss the review of the Consumer Acquis, to be the key solutions to the crisis. Event titled „Un Etat membre à la une - la République which covers a number of Directives on consumer (more on page 3). tchèque“ in Brussels on June 23, 2009 protection with MEPs and business representatives. 51st Annual Engineer- port for European Companies Entering Non-EU Mar- FOCUS 89 presents Kolja ing Fair in Brno kets: How to do it” Deputy Trade Minister Martin Tlapa FLAGEY and EUNIC BRUSSELS in cooperation From 14 to 18 September, the discussed the types of support and the initiatives avail- with SE PRES and EESC invite you to a week- 51st Annual Engineering Fair able at the the European level for businesses. The goal long festival FOCUS 89 (Nov. 9-15) to celebrate was held in Brno (CZ). CEBRE, of the seminar was to inform businesses about un- the 20th anniversary of the fall of the Berlin Wall. along with Czech businesses discussed current EU used available funds and the opportunity for new Eu- Films and debates about 20 years of (r)evolution in initiatives and financial tools and conducted a joint ropean Commission initiatives designed to help them Europe will be introduced by renowned personali- CEBRE-CZECHTRADE seminar on the topic “Sup- succeed in non-EU markets. ties (politicians, directors, ac- tors). On Nov. 13, Czech Os- Any questions or comments? car film Kolja will be shown. available Interested in participating in some events? More at www.focus89.eu. in Brussels! Contact us at: [email protected]

Published by: Czech Chamber of Commerce in cooperation with the Confederation of Employers’ and Entrepreneurs’ Associations of the Czech Republic and the Confederation of Industry of the Czech Republic • Managing editor: Tereza Šamanová • Editors: Jan Zikeš, Blanka Jakubcová • Translation: Mulberry s.r.o., U kněžské louky 23, Praha 3 • Photo: Tošenovský album, CEBRE, Jan Vytopil (Vicenová, Czech Street Party) • Editorial Board: Michal Kadera, Blanka Jakubcová, Jan Wiesner, Alena Vlačihová • Design and Project Management: Štrob, Širc, Slovák, s.r.o., Medkova 45 Praha 4 • Printed by: Proxima s. r. o. • Registration: Ministry of Culture of the Czech Republic - MK CR E 13767 • Periodicity: Quarterly • Edition: 500 copies • Distribution: Own • This edition was published on 21 September 2009 • CEBRE operates within the legal framework of CzechTrade in Brussels as a part of the commercial and economic section of the Embassy of the Czech Republic to the Kingdom of Belgium • Czech Business Today is also available on www.czechbusinesstoday.eu