Employment and Business in the Czech Republic after the New Immigration Act Amendment
August 15, 2017 brought significant changes for foreigners in terms of both residency status and running a business. Rules are stricter and unclear. More backing documents and less carelessness for employees and corporations – that is the Amendment. Photo: Pixabay
The following applies to non-EU nationals residing in the Czech Republic.
5 instead of 2 years of interrupted stay
One of the major modifications in the new Amendment refers to the switch of your purpose of stay to business purpose.
Before August 2017, you could change the purpose after 2 years of living in the Czech Republic, but the newly implemented Amendment requires at least 5 years of residency (not applicable on family dependence visa).
Relocation service experts from Move to Prague Daria Somova and Jan Kalina explain the motivation behind the change: “As for the changes in the business section, especially the part about changing the residency purpose, the main reason could be that a lot of people are coming to Prague to study or work and when they don’t want to do it anymore, they switch to the business purpose without really freelancing, making any money and paying taxes.”
Free of debt or no business permit
Authorities announced a brand new requirement for long-term residence permit for the purpose of business. The new certificate of no outstanding payments applies to all businesses regardless their size and origin and it concerns both permit and its renewal.
- the authorities of the Financial Administration of the Czech Republic (Tax Authority);
- the authorities of the Customs Administration of the Czech Republic;
- the district (municipal, Prague) social security administration;
- the relevant medical insurance company, if the foreign national participates in public medical insurance.
The process involves making appointment with authorities, filling in an application form, and having your documents ready (copy of your passport, stamp from foreign police/rental contract or another proof of accommodation, if applicable – a fee stamp of 100 CZK for the application).
Move to Prague experts further explain: “Financial office, social authority and customs have officially a month to prepare the proofs of no debt. However, if there is a problem it can take up to 6 weeks. The applications of no debt proof at the financial authority and customs cost 100 CZK each. Other applications are for free.”
Then you should wait for a call from the office. “They usually call you from a secrete number, sometimes send you an SMS,” Daria from Move to Prague agency adds and continues: “The crucial thing is to know what branch of financial and social authority you are registered at. Otherwise, you will not get what you need.”
Your employer’s company gets in debt – immediate termination of an employee card
The Amendment enables to terminate the validity of the foreign national’s card or the card of an intra-company transferred employee if the company ceases to be free of debt. For a foreigner, an immediate loss of job because of the company’s debt can be really scary.
Daria from Move to Prague calls this part in question: “No one really knows how the Ministry will proceed in such cases. Already now, many things depend on the mood of the officer who is making the decision about your application. I am a bit afraid that this rule can be easily abused. However, in reality, I do not think the Ministry would terminate the permit immediately. They must send an official letter informing you about the termination and give you a leaving order (usually 60 days). You should be able to find a new employer within that time.”
Changing or losing a job can be a complication
New Amendment pursues several issues which restrict the options of non-EU nationals.
Tomáš Jungwirth, Policy Officer at the Consortium of Migrants Assisting Organizations in the Czech Republic, explains for Expats.cz what is a confirmation of a change of employer: ”It is when a person loses their job or plans to change the employer that it becomes restrictive. Unfortunately, to change a job requires confirmation that the given person is actually going to their present employer; saying you intend to leave and asking for confirmation of employment can obviously be problematic.”
This document has to be prepared and submitted within 60 days.
If you are both a partner of a company with a position in a statutory body and an employee, since August 15 you are not eligible to have an employee card. Problem arises if you have not stayed in the Czech Republic for more than 5 years and hence you cannot obtain business permit.
Here it gets really complicated. If you didn’t manage to get business visa before August 15, Daria from Move to Prague suggests: ”Stay in your employment card, or you will need to apply for a business visa from the beginning. Another option is to find a new employer and apply for a change of employer. You can also transfer the company to someone else’s name (your wife for example).”