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The Buzz in the Czech Republic: Interview with Dagmar Dubecka of Kocian Solc Balastik

The Buzz in the Czech Republic: Interview with Dagmar Dubecka of Kocian Solc Balastik

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The Czech Republic is experiencing strong positive winds, irrespective of the severity with which the pandemic struck, and there are things aplenty to be happy about, according to Kocian Solc Balastik Partner Dagmar Dubecka.

“It’s really been exciting to be back in the office in full swing over the summer – there’s been a very positive mood in the air in the Czech Republic, as both domestic and international investors have been keen to get back to restored business operations,” Dubecka begins. “We’ve seen pent-up demand and strong competition amongst buyers and strong growth trends – the Finance Ministry is now predicting GDP growth of 3.2% in 2021, driven by all components of domestic demand, mostly investment and household consumption.”

Dubecka reports that, while growth has been evident in a variety of business sectors, the clear exceptions are travel and hospitality. “Both were severely hit by COVID-19 restrictions and will take some time to recover, dependent on global travel trends,” she says.

On the other end of the spectrum lie IT/technology and real estate, according to Dubecka, as the most active sectors. “Our firm has seen a lot of action here, especially with advising the Arete Invest Group in one of the largest Czech-Slovak real estate transactions in 2020, the sale of a portfolio of 11 logistics and industrial parks in the Czech Republic and Slovakia to the Australian Cromwell fund,” she reports. As for IT/technology, she reports a swath of webhosting and domain registration acquisitions, cybersecurity acquisitions, as well as information system and CRM platform transactions.

“The pandemic accelerated digitalization in all sectors of the economy and the excellence of the Czech tech sector as well as the motivation of companies not to fall behind in adopting digital solutions makes it likely that the tech sector will continue to be a key driver of M&A activity,” Dubecka continues. A strong trend in the last couple of years, despite the Covid era she says, has been a “rising share of investments with high value-added, i.e. investments focused on technology and R&D in strategic sectors. CzechInvest notes that, in 2018, only 20% of investment projects it arranged fulfilled the high value-added criteria. In 2020, this jumped to two-thirds of investment projects,” Dubecka reports.

Finally, tackling current regulatory issues, Dubecka mentions a “very new and untested area” of the new Foreign Direct Investment Act, which took effect in the country on May 1, 2021. “Lawyers and their clients will need to pay due attention from the point of view of M&A practice implications, to assess whether an investment under consideration requires prior consultation with the respective responsible authority of the Czech Republic, or whether other aspects of a client’s existing business operations in the Czech Republic may be subject to review,” Dubecka says, “even potentially such matters as a change in company directors. It will be interesting to see this evolve,” she concludes.

Czech Republic Knowledge Partner

HAVEL & PARTNERS, attorneys-at-law, with offices in Prague, Brno, Bratislava, Pilsen, Olomouc, and Ostrava, has a team of 250 lawyers, tax advisors and 500 employees in total, is the largest independent law firm in Central Europe.

Our clients include large international companies, leading Czech and Slovak firms, including strategic state-owned companies and public sector authorities, as well as medium-size businesses, individual entrepreneurs, and investors. We advise approximately  150 of the Fortune 500 companies, almost 50 of the Czech Top 100 companies and 20 of the TOP 100 Slovak companies. HAVEL & PARTNERS currently provides its services to a total of 2,500 clients. We have the most comprehensive international support available to both Czech and Slovak law firms. We provide legal and tax advice in 12 languages in more than 110 countries around the globe. Up to 70 % of the transactions we deal with involve an international aspect.

HAVEL & PARTNERS was named the best law firm operating in the Czech Republic by the prestigious global rating agencies Chambers and Partners (2020, 2021) and Who’s Who Legal (2018, 2019). It is also the most successful law firm, providing the most comprehensive legal services in the Czech Republic and Slovakia, based on the total number of all nominations and awards in all years of the Law Firm of the Year awards. The firm became the absolute winner of this competition four times in the last six years, receiving the main award Domestic Law Firm of the Year in the Czech Republic (2015, 2017, 2018, 2020) and ranking as one of the most recommended law firms in all categories of law. Our company is also a four -time winner of the Law Firm of the Year award for Best Client Services (2015, 2016, 2019, 2020). In the field of M&A, HAVEL & PARTNERS is the best law firm in the Czech Republic based on the annual International Advisory Experts awards (2018, 2019). Prestigious international rating agencies EMIS DealWatch and Mergermarket have ranked HAVEL & PARTNERS among the leading law firms by the number of transactions completed in the Czech Republic since 2010. Based on annual awards of the Acquisition International magazine, HAVEL & PARTNERS has become the Law Firm of the Year 2019 in the M&A category in the CEE region.

Firm's website: https://www.havelpartners.cz/en/

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