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ACT No. 248/1995 Coll. of 28th September 1995 on
Public Benefit Corporations and on the Change and Amendment of Some Laws
in the text of amendments by Acts No. 288/2002, 328/2002, 437/2003, 296/2007, 126/2008, 227/2009, and 231/2010
The Parliament has enacted the following law of the Czech Republic:
PART ONE
SECTION I
CHAPTER I
BASIC PROVISIONS
Article 1
This Act regulates the status and legal relations of the Public Benefit Corporation.
Article 2
1) The Public Benefit Corporation shall be a juridical pers on,
a) which has been established under this Act,
b) which renders generally beneficial services to the general public under
predetermined and to all clients identical conditions and
c) the economic result (profit) of which must not be used for the benefi t of its
Founders, members of its bodies or employees and must be used to rendering the
generally beneficial services for which the Public Benefit Corporation has been
established.
2) The name of the Public Benefit Corporation shall have to include the tex t: ‘obecne
prospesna spolecnost [Public Benefit Corporation]’ or its abbreviation ‘o.p.s.’. No
other persons shall be entitled to use this identification in their name or business
firm name.
CHAPTER II
ESTABLISHMENT AND INCORPORATION OF A PUBLIC BENEFIT CORPORATION
Establishment of a Public Benefit Corporation
Article 3
The Founders of the Public Benefit Corporation may be natural persons, the Czech
Republic or juridical persons.
Article 4
1) The Public Benefit Corporation is established by the Agreement on Establishment

signed by all Founders. Signatures of all founders shall be made under office. In the
case of a single Founder, the Agreement on Establishment shall be replaced by the
Deed of Establishment drawn up in the form of a public notary record.
2) The Deed of Establishment or the Agreement on Establishment (hereafter only
“the Deed of Establishment”) shall include the following:
a) the name, seat and identification number of the Founder, be it a juridical person
or the name or names and family names , birth number eventually the birth date of a
foreigner, if the birth number was not issued, and the permanent address of the
Founder be it a natural person,
b) the name and seat of the Public Benefit Corporation,
c) the sort of publicly beneficial service s the Public Benefit Corporation is envisaged
to render,
d) the terms and conditions applicable for rendering of particular sorts of publicly
beneficial services,
e) the period of time for which the Public Benefit Corporation is being established,
unless i t is being established for an indefinite period of time,
f) the name or names and family names, birth numbers eventually the birth date of a
foreigner, if the birth number was not issued and permanent addresses of the
members of the Board of Directors,
g) the name or name and family name, birth number and permanent address of the
Executive Director of the Public Benefit Corporation (hereafter only “the Director”); in
case of a foreigner, the name eventually names and family name, the birth number
or the bir th date, if the birth number was not issued, permanent addresses abroad
and address lof dwelling on the territory of the Czech Republic,
h) the names or names and family names, birth numbers and permanent addresses
of the members of the Supervisory Board; in case of a foreigner, the name
eventually names and family name, the birth number or the birth date, if the birth
number was not issued, permanent addresses abroad and address of dwelling on the
territory of the Czech Republic,
i) the value of and description of property contributions of individual founders, if
contributed; in case of a non -monetary contribution determination of its character
and value assessment prepared by a licensed assessor,
j) determination of the possibility to provide remuneration to members of the Boear
of Directors and Supervisory Board with the manner of deciding about the value of
the remuneration,
i) the value and description of the assets endowed by individual Founders; in the
case of a non-monetary endowment, the specificati on of the property object and the
its evaluation rendered by an authorized expert,
3) The Deed of Establishment may further determine in particular
a) conditions for making changes in given sort of rendered publicly beneficial

services,
b) manner in which act the Board of Directors and the Supervisory Board,
c) manner in which a given number of members of the Board of Directors, eventually
of the Supervisory Board are elected or appointed upon proposal of a certain circle of
citizens or upon proposal of a certain juridical person, an authority of the territorial
unit self-government or an authority of the state administration,
d) determination of the possibility of a repeated membership in the Board of
Directors,
e) reasons applicable by a founder in case o f recalling a member of the Board of
Directors,
f) conditions under which the property contributed or donated by a founder may be
alienated or mortgaged.
4) The Deed of Establishment may also specify a receiving Public Benefit Corporation
entitled to take over the liquidation balance, which remains after wounding -up the
Public Benefit Corporation with liquidation; it may also specify that such a receiving
Public Benefit Corporation shall be determined by the Board of Directors in its
resolution on winding u p the Public Benefit Corporation. The Deed of Establishment
may also exclude the transfer of rights and obligations of the founder on another
person.
Incorporation of the Public Benefit Corporation
Article 5
1) The Public Benefit Corporation comes into exi stence by the date of incorporation
in the Public Benefit Corporations Register (hereafter only “the Register”). The
Register shall be maintained by the court charged under the special law [1] with
maintaining the Commercial Register (hereafter only “the R egistering Court”).
2) The Proposal of Incorporating the Public Benefit Corporation in the Register
(hereafter only “the Incorporation Proposal”) shall be submitted by a Founder or a
person authorized in written to do so. To the Incorporation Proposal must be
attached the Deed of Establishment and the document showing the incorporation
and continuing existence of the Founder, be it a juridical person. The Incorporation
Proposal has to be submitted not later then 90 days after the establishment of the
Public Benefit Corporation.
3) The data entered into the Register [upon incorporation] shall include the following
items:
a) the business name, the seat and the identification number [2] of the Public
Benefit Corporation; the identification number shall provide to the Register the
custodian of the Basic Register of Persons [2].
b) the name, seat and the identification number of the Founder be it a juridical
person or the name eventually names and family name , the birth number, eventually
the birth date of a forei gn founder, if the birth number was not issued, and the
permanent address of the Founder, be it a natural person,

c) the name eventually names and family name , the birth numbers and the
permanent addresses of the members of the Board of Directors; in case of a
foreigner, the name eventually names and family name, the birth number or the
birth date, if the birth number was not issued, permanent addresses abroad and
address of dwelling on the territory of the Czech Republic,
d) the name or name and family name, birth number and permanent address of the
Director; in case of a foreigner, the name eventually names and family name, the
birth number or the birth date, if the birth number was not issued, permanent
addresses abroad and address lof dwelling on the ter ritory of the Czech Republic,
e) the sort of publicly beneficial services for the rendering of which the Public Benefit
Corporation has been established, and the subject of complementary activities if
these are to be pursued (Article 17),
f) the name eventually names and family name , the birth numbers and the
permanent addresses of the members of the Supervisory Board; in case of a
foreigner, the name eventually names and family name, the birth number or the
birth date, if the birth number was not issued, p ermanent addresses abroad and
address of dwelling on the territory of the Czech Republic,
4) If the Public Benefit Corporation is envisaged to pursue operations for the
pursuance of which special preconditions are required to be met, or the manner in
which such operations shall be pursued must be specified, the Founder shall be
obliged to prove fulfillment of these facts [2a].

5) Unless stipulated otherwise by this Law, the relevant Articles of the Commercial
Code [3] and the Civil Court Rules Code [4] rel ated to the Commercial Register
maintanance regulate the matters concerning the Register.

Article 6
1) The Founder of the Public Benefit Corporation shall act in all matters related to
the establishment of the Public Benefit Corporation and on its behalf until its
incorporation. If there is more than one Founder, they shall act jointly or the one of
them who was authorized to do so in writing.
2) The obligations resulting from the acts of the Founder according to above Par. 1
shall be transferred to the P ublic Benefit Corporation from the moment of its
incorporation. Within the term of three months, the Public Benefit Corporation may
reject such obligations that would prevent it from fulfilling the purpose for which it
was founded. In such a case, the Foun der or the Founders shall be made liable for
the rejected obligations jointly and severally.
CHAPTER III
WINDING UP, LIQUIDATION AND CANCELLATION
OF THE PUBLIC BENEFIT CORPORATION

Article 7
1) The Public Benefit Corporation shall be considered cancelled b eginning from the
date it has been erased from the Register.
2) The cancellation of the Public Benefit Corporation shall precede its winding up
with or without liquidation. No liquidation is required if the Public Benefit Corporation
is being dissolved by amalgamation, merger or split -up; for the dissolution of the
wound -up Public Benefit Corporation and the cession of rights and duties the Article
69 of the Commercial Code shall apply accordingly.
3) The domestic unification by merging of a Public Benefit Corporation is possible
only with another Public Benefit Corporation; cross-boarder unification is not allowed.
Split of a Public Benefit Corporation is allowed only when it results in new Public
Benefit Corporations; other legal forms resulting from a spl it are not allowed. When
processing according to the first and second sentence, the provisions regulating
domestic unifications and splits of the Act on Changes of Legal Forms of Commercial
Companies and Cooperatives shall be applied. Public Benefit Corpor ation may
amalgamate or merge with another public benefit corporation, only. The Public
Benefit Corporation may split up to form other public benefit corporations, only.
Article 8
1) The Public Benefit Corporation is wound up
a) upon the expiration of the time for which it was established,
b) upon accomplishment of the purpose for which it was established,
c) by the date specified in the Board of Directors resolution on winding up the Public
Benefit Corporation,
d) by domestic unification by merging or by s plitting, amalgamation or merger with
another public benefit corporation or by splitting -up into two or more public benefit
corporations,
e) by the date specified in the Court Ruling on the wind up of the Public Benefit
Corporation, otherwise by the date s uch Ruling becomes legally effective,
f) by the date of proclamation of bankruptcy procedures related to its assets. or
rejection thereof on grounds of insufficient assets .
2) The Board of Directors must inform in writing the Founder on the resolution
refe rred to under Par. 1, Item c) in less then two (2) months before the date on
which the Public Benefit Corporation is to be winded up. In the case, when this
condition is not met, the aforesaid resolution is considered ineffective. Before the
Public Benefit Corporation is wounded up according to the resolution of the Board of
Directors, the Founder may modify or cancel that resolution. However, when doing
so, the Founder has to make arrangements allowing for the continuation in
operations of the Public Benefit Corporation at least in the scope that allows fulfilling
the obligations of the Public Benefit Corporation., which corresponds to the reasons
for which the resolution of the Board of Directors was modified or cancelled.
3) If the resolution of the Board of Directors was modified or cancelled by the

Founder in the time when the decision has already been reported to the Registering
Court, the Court must be also notified about that Founder’s decision. Under such
circumstances, the previous motions of the Board of Directors of the Public Benefit
Corporation for liquidation or appointments of the Liquidating Officer are considered
ineffective.
4) Acting upon the motion of a governmental agency, the Founder or the person
proving legal interest, the Court shall decide on winding up of the Public Benefit
Corporation and on its liquidations if:
a) no meeting of the Board of Directors of the Public Benefit Corporation took place
in the last year;
b) no bodies of the Public Benefit Corporation were appointed and the term of office
of the lastly appointed bodies of the Public Benefit Corporation had expired by over a
year ago;
c) the Public Benefit Corporation has failed to render the publicly beneficial services
specified in its Deed of Establishment for over six (6) months;
d) the quality, scope and availability of the publicly beneficial services for the
rendering of which the Public Benefit Corporation was established has been
repeatedly jeopardized during the last six (6) months by pursuing the
complementary activi ties;
e) the Public Benefit Corporation uses the income from its operations and assets it
manages in conflict with this Act;
f) the Public Benefit Corporation has violated the provisions of this Act.
5) The court may set a date by which the cause for which the motion for winding up
the Public Benefit Corporation was made is to be remedied.
6) If the Founder ceases to exist, the Founder’s legal successor shall assume the
Founder’s rights and duties.
7) In the case when the single Founder ceases to exist with out a legal successor or a
single Founder dies, The Board of Directors shall decide about transfer of the rights
and duties specified by this Act on another person within six (6) months from the
day of being informed about non-existence or death of the Fou nder, unless
otherwise specified by this Act. The Supervisory Board must express its consensus
with the above transfer. If the Board of Directors does not decide within the term in
the first sentence on the transfer of rights and duties of the Founder on another
person, it is the Court who shall decide upon the proposal of a member of the
Supervisory Board of the Public Benefit Corporation or a person that proves legal
interest, or without any proposal. The person on whom the rights and duties of the
Founder are to be transferred must express consensus with this transfer.
Article 9
1) For the execution of the liquidation the Board of Directors shall appoint the
Liquidating Officer.
2) When the Board of Directors fails to appoint the Liquidating Officer, su ch an

officer shall be appointed without unreasonable delay by the Court competent to do
it according to the seat of the Public Benefit Corporation.
3) The Liquidating Officer shall start the liquidation by:
a) verifying that the Founders of the Public Ben efit Corporation had been advised of
the liquidation in due time;
b) by calling upon the creditors and other persons concerned by the liquidation to
claim their respective title rights and receivables by the time which shall not be
shorter than three (3) m onths;
c) by advertising the commencement of liquidation of the Public Benefit Corporation
in the Bulletin “Obchodni vestnik” [the Official Commercial Journal of the Czech
Republic];
d) by notifying the municipality in which the Public Benefit Corporation has its seat
and the competent Financial Office about the beginning of liquidation.
4) The procedure of the liquidation shall be designed so that only the assets
necessary for meeting the liabilities of the Public Benefit Corporation are changed
into cash money.
5) The property held by the Public Benefit Corporation constitutes the separate
estate in the liquidation and it shall be used for satisfying the creditors’ claims in the
sequence corresponding to that of liabilities payable after the declaration of
bankruptcy [5]. The Liquidating Officer’s remuneration shall be settled at the order
as defined in the special law [5]. for the Estate Trustee according to the Bankruptcy
and Settlement Act [5].
6) If the situation is other than that referred to under Art icle 4 Paragraph 4) above,
and the Founder of the Public Benefit Corporation is not the Czech Republic or the
Region, the liquidation balance shall be offered for transfer onto the municipality in
which the Public Benefit Corporation in liquidation has its seat. The property may be
transferred onto the municipality free of charge only if the municipality enters into a
contract obliging it to use such property in full extent for rendering the publicly
beneficial services for provision of which the Public Ben efit Corporation had been
established.
7) If it is not the case as specified in Article 4, Par. 4 and the Founder of the Public
Benefit Corporation is the Region, the Liquidating Officer shall offer the liquidation
balance to the Region.

8) If the Founder of the Public Benefit Corporation is the Czech Republic, the
liquidation balance shall be transferred to the Czech Republic.

9) If one of more Founders of the Public Benefit Corporation is a municipality, a
voluntary union of municipalities, a Region or the Czech Republic, the Liquidation
Officer shall offer a part of the liquidation balance to each and every of the Founders
according to the value of contributions endowed by them or their donations; if there

were neither contributions nor donations, all these Founders shall receive the equal
part.

10) If within thirty (30) days from reception of the offer made by the Liquidating
Officer the municipality or the Region fails to acknowledge in writing its intention to
take over the property offered, the sai d property shall be transferred by the
Liquidating Officer onto the Office for Representing the State in Property Matters .
District Administration Office competent as of the registered address of the Public
Benefit Corporation. The District Administration Office . The Czech Republic shall use
the property for rendering publicly beneficial services.
8) Within thirty (30) days after completing the liquidation procedure, the Liquidating
Officer shall submit to the Registering Court the proposal for erasing the Public
Benefit Corporation from the Register.

Article 9a
The Director

1) The Director is the statutory Representative of the Public Benefit Corporation, who
manages the activities of the Public Benefit Corporation and acts on its behalf.
The Board of Direct ors appoints and recalls the Director.
2) Only an impeccable natural person eligible to make legal acts can serve as the
Director; as regards the impeccability, the provisions of Article 10, Par. 3 shall be
applied similarly.
3) The Director may not serve as a member of the Board of Directors or Supervisory
Board, he or she is nevertheless authorized to participate in proceedings of the
Board of Directors and Supervisory Board with an advisory vote.
4) The Director shall execute his or her function according to a co ntract. As regards
the way in which the Director executes the function, the Article 10, Par. 5 applies
similarly
5) All matters concerning the relation of the Director to the Public Benefit
Corporation are in exclusive competence of the Board of Directors.

CHAPTER IV
BODIES OF THE PUBLIC BENEFIT CORPORATION
Board of Directors
Article 10
1) The Board of Directors is the statutory body of the Public Benefit Corporation.

1) The Board of Directors shall have at least three (3) and at most fifteen (15)
members. The number of members of the Board of Directors must be divisible by
tree.
2) Only an impeccable natural person eligible to make legal acts can serve as a
member of the Board of Directors. That person and persons closed to it shall not be
in the working or similar relation to the Public Benefit Corporation. In a working
relation with the Public Benefit Corporation may be up to one third (1/3) of the
members of the Board of Directors.
3) For the purposes of this Act, as impeccable is considered the person, w hich was
not lawfully sentenced for a deliberate criminal act.
4) The membership in the Board of Directors of the Public Benefit Corporation is
incompatible with membership in the Supervisory Board of the same Public Benefit
Corporation. The members of the
Board of Directors shall not be entitled to receive
any royalty for the performance in the capacity. The Public Benefit Corporation shall
be entitled to compensate the expenditures of the members of its Board of Directors
and Supervisory Board up to the l imit set under the applicable regulations [7].
5) The members of the Board of Directors are obliged to serve as careful managers
and to keep discretion as regards important information and facts, disclosure of
could cause damage to the Public Benefit Cor poration. In case of doubt about acting
of the member of the Board of Directors as a careful manager, such a member has
to prove that he acted as a careful manager. Those members of the Board of
Directors, who by a collective action caused damage to the Pu blic Benefit
Corporation, are liable for the damage collectively and indivisibly. Any agreement
between a member of the Board of Directors and the Public Benefit Corporation
excluding or limiting the liability of the member of the Board of Directors is dee md
invalid.
Article 11
1) The term of office of the members of the Board of Directors shall be three (3)
years.
2) Repeated membership in the Board of Directors is possible, unless the Deed of
Establishment specify otherwise. No member of the Board of Dire ctors shall serve in
the office for over two subsequent terms of office. After having served as a member
of the Board of Directors for six (6) years, the same person may become a member
of the board again after no less than one (1) year.
3) The members of the Board of Directors shall elect from amongst themselves the
Chairman of the Board of Directors who shall convene and chair the meetings of the
Board of Directors.
4) In decision-making, the voting rights of all members of the Board of Directors
shall be equal. Unless the Deed of Establishment or the Statutes stipulate otherwise,
in the case of the tie vote, the vote of the Chairman of the Board of Directors shall
decide. Unless the Deed of Establishment or the Statutes stipulate otherwise, the
Board of D irectors shall have reached its quorum if over one half of its members are
present and the majority of all present votes shall be necessary for a decision to be
passed.

Article 12
1) The Founder shall appoint the members of the Board of Directors, unless
stipulated otherwise in the Deed of Establishment.
2) Following the appointment of the first members of the Board of Directors, the
names shall be drawn in lots of one third of the members whose term of office shall
be ended after one year and one third of the members whose term of office shall
end after two years.
2) The membership in the Board of Directors shall expire
a) by expiration of the term of office,
b) by death,
c) by resignation,
d) by recall.
3) The Founder shall recall a member of the Board of Directors, if the member
ceases to fulfill conditions as required by Article 10, Par. 3, or if he or she has
violated in a serious manner or repeatedly the Deed of Establishment or Statute of
the Public Benefit Corporation or due to other reasons specified in the Deed of
Establishment.
4) The Founder shall recall the member of the Board of Directors within one (1)
month since the day when he or she has been informed about the cause for
recalling, but not later then six (6) months from the day, when that reason has
arisen. If the Founder shall not recall the member of the Board of Directors in the
given period of time or if there is no Founder and the Founder’s rights have not been
transferred to another person, the member of the Board of Directors shall be r ecalled
by the Court based upon a proposal of a member of the Board of Directors or upon
proposal of the Supervisory Board, or a person proving legal interest. District
Administration Office competent to do it, according to the registered address of the
Pu blic Benefit Corporation.
6) To fill the vacancies in the Board of Directors new members of the Board of
Directors shall be within sixty (60) days appointed or otherwise co-opted in a manner
specified in the Deed of Establishment. After idle expiration of this term, the Court
shall appoint new members of the Board of Directors based upon the proposal of a
member of the Board of Directors or upon the proposal of the Supervisory Board or
without any proposal. the Municipality Office with state administratio n rights as
corresponds to the seat of the Public Benefit Corporation on the proposal of the
statutory body, respectively supervisory body.
Article 13
1) The Board of Directors provides preliminary written consensus to a legal act, by
which the Public Bene fit Corporation
a) assumes rights to, alienates or mortgages a real estate,
b) assumes rights to or alienates a movable thing, creates the material burden

or option to buy a movable thing, whose value is higher then the value of a
thing determined as underlie to the public procurement regulations as
defined by the law on public procurment [6].
c) assumes rights to or alienates authors rights or commercial rights,
d) establishes another juridical person and contributes by a monetary or non –
monetary property to this juridical person.
2) The competencies of the Board of Directors approves:
a) the budget of the Public Benefit Corporation,
b) the ordinary and extraordinary annual balance sheet of incomes and expenditures
and the annual report of the Public Benefit Corporat ion,
c) the object of complementary activities (Article 17).

3) The Board of Directors decides about
a) winding up the Public Benefit Corporation, and in the case described in Article
4, Par. 4, about the Public Benefit Corporation to which the liquidation
balance shall be offered,
b) transfer of rights and duties of the Founder as defined by this Act onto
another person, when a single Founder ceases to exist without a legal
successor or when a single Founder died and the Articles of Incrporation do
not stipulate otherwise.
4) The Board of Directors may issue in less then six (6) months from the date of
incorporation of the Public Benefit Corporation the Statute of the Public Benefit
Corporation whereby the internal organization of the Public Benefit Corporation shall
be specified in detail; the Board of Directors approves any change of the Statute, if
such has been issued.
The data in the Statutes shall have to be identical with those
in the Deed of Establishment;
b) to approve any change, modification or amendm ent of the Deed of Establishment
in pursuance of Article 4 Paragraphs 3 and 4;
c) to decide on the wind up of the Public Benefit Corporation and to appoint the
public benefit corporation to which the liquidation balance shall be offered;
d) to take any ste ps necessary so that the purpose for which the Public Benefit
Corporation has been established is observed;
e) to approve the budget of the Public Benefit Corporation including any changes to
it and to approve specifically the administration costs of the P ublic Benefit
Corporation;
f) to approve the annual balance sheet of incomes and expenditures and the annual
report of the Public Benefit Corporation;
g) to decide on the object and scope of the complementary operations of the Public

Benefit Corporation be yond the scope set in the Deed of Establishment (Article 4
Paragraph 2 Letter c);
h) to grant consent for the alienation or mortgaging of real property of the Public
Benefit Corporation or for leasing such property for over one year unless a shorter
time l imit is stipulated by the Statutes;
i) to appoint and dismiss the Manager of the Public Benefit Corporation, to supervise
his/her activities and to determine his/her remuneration if the office of Manager is
established according to the Deed of Establishmen t of the Public Benefit Corporation;
j) to decide on any matters vested with the Board of Directors under the Deed of
Establishment.
5) The Public Benefit Corporation shall within thirty (30) days from issuing the
Statute according to the Par. 4 submit the Statute for insertion into the collection of
files [1]; similarly shall be done in case of changes of the Statue of the Public Benefit
Corporation.
2) The Board of Directors shall meet at least twice a year.
Article 14
1) When real estates or movable things are transferred for money in value as
defined in Article 13, Par. 1, Item b), and the Founder is the Czech Republic or a
self -governing territorial unit, the price should be negotiated on the locally
common level; free of charge may a real estate or a mov able thing transfer only
in the case, when the free of charge transfer is economically more suitable then
any other manner of managing the thing.
2) The Board of Directors shall not provide a preliminary consensus with a legal
act, if by its concluding woul d be jeopardized fulfillment of tasks of the Public
Benefit Corporation or of that violates Article 4, Par. 3.
3) The fact of providing the preliminary consensus with legal acts mentioned in
Article 13, Par. 1 shall the Board of Directors announce to the Dire ctor and to
the Supervisory Board within seven (7) days from the day of issuing it. When
the Founder of the Public Benefit Corporation is the Czech Republic or a self-
governing territorial unit, the Board of Directors is obliged to report the issue of
the preliminary consensus with legal acts mentioned in Article 13, Par. 1 within
seven (7) days also to that Founder.
4) The legal acts mentioned in Article 13, Par. 1 are invalid without a preliminary
consensus of the Board of Directors. These acts are considere d as valid, if the
Founder, the Board of Directors or a person effected by such an act shall not
effectively seek invalidity of such an legal act.
5) The Board of Directors shall care about perpetuating the purpose, for which the
Public Benefit Corporation h as been established and about tender management
with its property.

Manager
1) Only a person of civic integrity may be appointed the Manager.
2) While the Manager may not be a member of either the Board of Directors or the
Supervisory Board, he/she shall be entitled to attend the meetings of the Board of
Directors holding the advisory vote.
3) The Manager shall manage the operations of the Public Benefit Corporation unless
the management of such operations is vested with the Board of Directors or another
body of the Public Benefit Corporation under law, the Deed of Establishment or the
Statutes.
Supervisory Board
Article 15
1) The Supervisory Board shall be the inspecting body of the Public Benefit
Corporation.
2) The Supervisory Board shall be obligatorily established by the Public Benefit
Corporation into the assets of which government or municipal property has been
invested; the same holds for the Public Benefit Corporation, which is obliged under
law to maintain its bookkeeping records according to the d ouble -entry accounting
system. The establishment of the Supervisory Board may be prescribed under the
Deed of Establishment, as well.
2) The Supervisory Board shall have at least three (3) and at most seven (7)
members. The members of the Supervisory Board shall elect the Chairman, who shall
convene and chair the meetings of the Supervisory Board.
3) The Founder shall appoint the members of the first Supervisory Board, unless the
Deed of Establishment stipulate otherwise.
4) Unless otherwise stipulated by this Act, the manner of establishment and
performance of the membership in the Supervisory Board shall be regulated
accordingly by the provisions stipulated for the Board of Directors in this Act, as
appropriate.
Article 16
1) The Supervisory Board
a) reviews the ordinary and extraordinary annual balance sheet of incomes and
expenditures and the Annual Report of the Public Benefit Corporation;
b) reports at least once every year to the Director and to the Board of Directors on
the findings obtained by its in spection activities;
c) examines, whether the Public Benefit Corporation operates in accordance with the
law and the Deed of Establishment of the Public Benefit Corporation.
2) The Supervisory Board shall be entitled:
a) to make motions to the Board of Dir ectors for the dismissal of the Manager;

a) to review the accounting books and other documents and to inspect the data
therein recorded;
c) to convene a special meeting of the Board of Directors if required in the interest of
the Public Benefit Corporation .
The members of the Supervisory Board shall be entitled to take part on the meeting
of the Board of Directors; they must be given floor for a word, when they ask for it.
3) The Supervisory Board shall be obliged to notify the Director and the Board of
Dir ectors of any violation of laws, stipulations of the Deed of Establishments or the
Statute and of any instances of bad business management and/or any other defects
or deficiencies in the operations of the Public Benefit Corporation. The Supervisory
Board is entitled to determine a period of time within which the Director or the Board
of Directors should remedy the deficiencies. If the remedy is not made, the
Supervisory Board shall immediately inform about detected deficiencies the Founder.
CHAPTER V
BUSIN ESS MANAGEMENT OF THE PUBLIC BENEFIT CORPORATION
Article 17
1) Besides the publicly beneficial services for the rendering of which the Public
Benefit Corporation has been established, the Public Benefit Corporation may pursue
also other activities (“comple mentary activities”) under the condition, that due to the
complementary activities there has been improved the utilization of the assets of the
Public Benefit Corporation without simultaneous jeopardizing the quality, scope and
availability of the rendered publicly beneficial services.
2) The Public Benefit Corporation may not take part in the entrepreneurial activities
of other persons.
and/or to establish its branches outside the territory of the Czech
Republic.
3) The net profit as reported at the end o f the fiscal year shall be transferred by the
Public Benefit Corporation to the Reserve Fund in its full amount. The Reserve Fund
shall be first used to cover any losses reported in future fiscal years.
4) The equity of the Public Benefit Corporation shall be the source for financing the
operations of the Public Benefit Corporation. The equity shall comprise:
a) the value of assets endowed by the Founders,
b) the value of gifts and inheritance received
c) the funds created by the Public Benefit Corporation
d) the subsidies.
3) The Public Benefit Corporation, which operates as a private higher education
institution according to the special law [7a] deems to be considered a public higher
education institution for the purpose of the Act on Income Tax.
Article 18

cancelled
1) In making the necessary arrangements to pursue its operations, the Public Benefit
Corporation may apply for subsidies granted form the governmental budget, from
the budget of the District Administrative Office, from the communal budget or f rom
the budget of another territorial body of the public administration [8], as well as to
apply for grants from a fund established by the law.
2) The subsidies from the budget of the Government or from the communal budget
or from the District Administrati on Office budget or from the budget of another
territorial body of the public administration may be granted to the Public Benefit
Corporation for one and the same project or one and the same activity from a single
source, only.
3) For a subsidy from the go vernmental budget, the Public Benefit Corporation shall
apply to the governmental body competent to it according to the prevailing activity
rendered by the Public Benefit Corporation.
4) The body through which the subsidy is being granted shall decree the terms and
conditions for granting the subsidy and it shall inspect and evaluate the utilization of
the subsidy made.
Accounting and the Annual Report
Article 19
1) The double -entry accounting system shall have to be used by the Public Benefit
Corporation
a) which pursues complementary operations;
b) the total receipts (net incomes) of which in the last year were in excess of CZK
three million (3,000,000).
1) The Public Benefit Corporation shall be obliged to clearly separate in its
accounting books the inco mes and expenditures related to the complementary
operations from those related to the publicly beneficial services, as well as from any
incomes and expenditures not related under the aforesaid groups and/or related to
the administration of the Public Bene fit Corporation.
3) The ordinary and extraordinary end -of the year balance sheet of incomes and
expenditures shall be audited by an licensed auditor for those Public Benefit
Corporation which
a) are the beneficiaries of subsidies or other incomes from the governmental budget,
from the budget of a municipality or from the budget of another territorial body of
the public administration or from any governmental fund, the total of which exceeds
one million Czech crowns (CZK 1,000,000) in the year for which the balance sheet is
consolidated;
b) have not established the Supervisory Board, or
b) have their net turnover exceeding ten million Czech crowns (CZK 10,000,000).
4) In all other aspects shall be the Public Benefit Corporations regulated by the laws

and regu lations effecting the accounting procedures [9].
Article 20
1) By the date set by the Board of Directors, which shall not be later than six (6)
months after the end of the reviewed period, the Public Benefit Corporation shall
compile and publish its Annual Report on its activities and business management
.
The purpose of the Annual Report is to inform on activities and management of the
Public Benefit Corporation. This does not effect the obligations according to special
regulations [9]. The reviewed period
shall be the calendar year. In the Statutes, the
reviewed period may be modified to be the academic year for the Public Benefit
Corporation whose publicly beneficial services are those in education and training.
2) The Public Benefit Corporation shall dep osit the Annual Report within thirty (30)
days from its approval to the collection of files [1]. In the Deed of Establishment or
the Statute of the Public Benefit Corporation may be determined additional manner
of publishing the Annual Report. obliged to p
ublish its first annual report not later
then 18 months from its incorporation.
3) If after publishing the Annual Report will be revealed facts which provie a reason
for correcting it, the Public Benefit Corporation is obliged to publish such an
correction without unnecessary delay; for publishing the correctons of the Annual
Report applies similarly Par. 2.
The Annual Reports shall have to be made accessible
to the general public.
Article 21
The Annual Report of the Public Benefit Corporation shall besides matters
determined in the laws regulating on accounting [9a] include also informations on:
a) all activities pursued within the accounting period in the framework of the publicly
beneficial services and complementary activities together with their evaluation,
calendar year with specification of the relation to the purpose of establishment of the
Public Benefit Corporation;
b) human resources,
c) incomes divided by sources,
d) development and actual status of the funds of the Public Benefit Corporation to
the balancing day [9b],
e) status of assets and liabilities of the Public Benefit Corporation to the balancing
date and on their structure,
f) total amount of expenditures separated into expenditures for providing the publicly
beneficial services, for complementary activities, and for own activities of the Public
Benefit Corporation, including the amount of expenditures for salary of the Director
and for remuneration of the members of the Board of Directors and the members of
the Supervisory Board,
the an nual balance sheet of incomes and expenditures and the critical review of the
basic data therein included;

c) the statement of the auditor to the annual balance sheet of incomes and
expenditures, if auditing was made;
d) the review of money received and sp ent;
e) the review of income (revenue) structured by source;
f) the movements in and the final balances of funds of the Public Benefit
Corporation;
g) the movements and balances of assets and liabilities of the Public Benefit
Corporation;
h) the total amou nt of costs structured by those spent for rendering the publicly
beneficial services, for pursuing complementary operations and administration costs
of the Public Benefit Corporation;
g) any changes, modifications and amendments of the Deed of Establishment and
changes in the membership of the Board of Directors and Supervisory Board, and
about a change in the person serving as the Director managerial bodies of the Public
Benefit Corporation as occurred throughout the accounting period. year;
j) other data specified by the Board of Directors.
2) For an audit of the Annual Report by a licensed auditor shall be applied similarly
Article 19, Par. 2.

Article 22
If the Public Benefit Corporation violates in its duties under Articles 2, 17 and 20
hereof, it shal l be stripped
a) of the tax benefits set forth by this Act, by the Income Tax Act, and by the
Inheritance, Gift and Property Transfer Taxes Act for the year in which such violation
occurred [10],
b) of the tax benefits set forth under the Property Tax Act [11] for the next tax
period following that in which the violation occurred.
Section II
Transitional Prepositions

1. If the Public Benefit Corporation has been established befor the day of
effectivity of the Act No. 231/2010, it shall do the following:
a. The F ounder shall bring the Deed of Establishment into accord with
the Act No. 248/1995 to the date of entering into force of the Act No.
231/2010; if there is no Founder, it will be accomplished by the Board
of Directors.

b. The Board of Directors shall bring the Statute of the Public Benefit
Corporation, if issued, into accord with the Act No. 248/1995 to the
date of entering into force of the Act No. 231/2010
All that within six (6) months from the date of entering into force of the
Act No. 231/2010 [January 1, 2011].
2. If the Public Benefit Corporation has no Director to the date of entering into
force of the Act No. 231/2010, the Board of Directors of this Public Benefit
Corporation shall appoint the Director in complience with the Act No.
228/1995, in the text effective to the date of entering into force of the Act
No. 231/2010, and that within six (6) months from the date of entering into
force of the Act No. 231/2010 [January 1, 2011]. Until the appointment of
the Director, the rights of the statutory body of the Public Benefit Corporation
according to the Article 9a of the Act No. 228/1995, in the text effective since
the date of entering into force of the Act No. 231/2010 shall be executed by
the Board of Directors.
3. The Director of the Public Benefit Corporat ion appointed to the position
before the day in which the Act No. 231/2010 enters into force ris deemed to
become the statutory representative of the Public Benefit Corporation
according to the Article 9a of the Act No. 228/1995, in the text effective sin ce
the date of entering into force of the Act No. 231/2010.
4. For drafting and publishing the Annual Report of the Public Benefit
Corporation related to the accounting period lasting before the Act No.
231/2010 entered into force shall be used the Act No. 22 8/1995, in the text
effective until the date of entering into force of the Act No. 231/2010.

PART TWO
[Extending the corporate income tax exemptions to public benefit corporations] The Act of the Czech National Council No. 586/1992, on Income Tax, as amen ded
under the Act of the Czech National Council No. 35/1993, the Act No. 96/1993, the
Act No. 157/1993, the Act No. 196/1993, the Act No. 323/1993, the Act No.
42/1994, the Act No. 85/1994, the Act No. 114/1994, the Act No. 259/1994, the Act
No. 32/1995, t he Act No. 87/1995, the Act No. 118/1995 and the Act No. 149/1995,
is herewith amended and complemented to read:
1. In Article 18 Paragraph 7 the words “the public benefit corporations” are added to
follow the words “the foundations, “.
2. The Article 34 i s complemented by Paragraph 12, which reads as follows:
“(12) Paragraphs 1 and 2 shall not apply for public benefit corporations”
3. [Not related to Public Benefit Corporations]In the Appendix to the Act, under Item
(1 -27), the words “instruments for field lengths measurement” are replaced by words
“length measuring tools” and the words “instruments for field lengths measurement”
are replaced by the words “length measuring tools” also under Item (2- 53).

PART THREE
[Not related to Public Benefit Corporations ] The Act No. 149/1995, whereby the Act of the Czech National Council No. 586/1992,
on the Income Tax, as amended under the later legislation, is amended and whereby
the Act of the Czech National Council No. 589/1992, on Social Security and
Government Empl oyment Policies Contribution Payments, as amended under the
later legislation, is amended and the Act of the Czech National Council No. 185/1991,
on the Insurance Sector as amended under the later legislation are herewith
amended and complemented as follows:
1. In part V Item 1 the text “in the Items 1 and 2” is replaced by the text “in the
Items 1,2 and 3”.
2.In Part V Item 1 the clause “An analogous procedure may be pursued for a whole
set of such receivables” is inserted to follow the second clause.
PART FOUR
[Extending the real property tax exemption to public benefit corporations] The Act of the Czech National Council No. 338/1992, on the Real Property Tax as
amended under Act No. 315/1993, and Act No. 242/1994 is herewith amended to
read:
1. In Article 4 Paragraph 1 Letter f) the comma following the text “civic associations”
is deleted and the text “and public benefit corporations”‘ is added.
2. In Article 9 Paragraph 1 Letter f) the comma following the text “civic associations”
is deleted and the text “and public benefit corporations”‘ is added.
PART FIVE
[Extending the inheritance tax, gift tax and property transfer tax exemptions to
public benefit corporations and amending the reporting obligations in case of an
exempt] Act of the Czech National Counc il No. 357/1992, on the Inheritance, Gift and
Property Transfer Tax as amended under Acts of the Czech National Council Nos.
18/1993, 42/1994, 72/1994, 85/19994 and 113/1994 is herewith amended to read:
1.In Article 20 Paragraph 4 at the end of Letter b) t he period is replaced by the
comma and Letter c) is added reading: ‘(c) designated by the public benefit
corporations for their operations.’.
2. In Article 21 Paragraph 1 at the end of Letter c) the period is replaced by the
comma and Letter d) is added re ading:
“d) after the end of every six months of the current calendar year, if the transaction
is a free of charge property acquisition by legal entities according to the Article 20
Paragraph 4 hereof. The tax return shall include all property so acquired t hroughout
this period.”.
PART SIX

This Act comes into effect by 1st January 1996.
Signed by Uhde, Havel and Klaus