CEE Legal Matters

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  • Czech Energy Act Amendment – A Step Towards a Clean Future?

    The long-awaited amendment to the Czech Energy Act, known as “Lex OZE III”, has officially been passed by the Parliament. While it introduces significant and predominantly positive changes to the clean and renewable energy sector, it has also sparked considerable controversy. The proclaimed objective of the legislation is to accelerate the transition to sustainable energy while addressing regulatory and market challenges. Nevertheless, it lags behind the technical and commercial realities of the European market; it implements a European directive that the Czech Republic should have adopted over four years ago.

    Key Updates

    First and foremost, Lex OZE III officially introduces several important concepts to the Czech energy legislation, including energy storage, aggregation, and flexibility. The fact that these concepts were previously not acknowledged in Czech energy legislation created practical obstacles for investors.

    Another major change is the increase in the threshold for requiring a construction permit and a license for electricity generation or storage from 50 kW to 100 kW. Similarly, the limit for simplified construction procedures has been raised from 100 kW to 250 kW.

    Energy storage is now recognized as an independent energy source, allowing standalone facilities to connect to the distribution grid at any location instead of being restricted to existing sources. Furthermore, the amendment introduces a specific 25-year license for electricity storage.

    In terms of market flexibility, aggregation is now defined as the process of pooling flexibility from electricity market participants to offer it on the market or manage deviations. Entities engaged in aggregation are required to hold a general electricity trading license, not any specialized one. Flexibility is also formally defined as the ability to adjust electricity supply to or from the grid based on market prices or demand fluctuations.

    Additionally, consumer protection measures have been strengthened, with energy traders now required to disclose a “security index” that indicates the amount of electricity or gas pre-purchased to meet customer demand.

    Controversies

    Despite its ambitious goals, Lex OZE III has faced substantial criticism from municipalities and the renewable energy sector. A significant point of contention is the introduction of individual profitability checks for PV power plants commissioned in 2009 and 2010. This measure is perceived as penalizing efficient investors while favouring less economically savvy ones, potentially dampening investment enthusiasm in the Czech renewable energy market. Furthermore, it may be viewed as retroactive, posing arbitration risks for the Czech Republic, in particular taking into consideration the previously introduced measures aiming to reduce the subsidy received by these sources, including the so-called “solar tax” or sector profitability checks carried out in 2019 – 2022.

    Another contentious amendment, referred to as the “construction rider,” imposes restrictions on Prague, Brno, and Ostrava regarding their building regulations. These cities can, for example, no longer coordinate tree planting with technical infrastructure development, leading to strong opposition from local governments. Despite the resistance, this amendment ultimately passed, limiting the regulatory powers of major cities in urban planning. However, the Minister of Industry and Trade mentioned that this amendment was not intentional and indicated that it should be rectified soon.

    Conclusion

    As the amendment is anticipated to be signed by the president soon, with most provisions going into effect five months later (late summer 2025), attention is shifting to its real-world implications. Only time will show if LEX OZE III will promote long-term renewable energy growth or inadvertently hinder progress. Either way, some municipalities are already considering legally challenging particular provisions, and three international businesses active in the Czech energy market have indicated a readiness to pursue arbitration proceedings against the state because of the expected negative impacts of the individual profitability checks.

    This is the first article in the series covering LEX OZE III; further articles focusing on specific amended topics in more detail will follow soon. Stan tuned!

    By Lukas Vymola, Counsel, Jan Gerych and Stefan Potocnak, Senior Associates, and Tomas Jonas, Associate, Dentons

  • Takeover Bid Obligation When Transferring Shares to a Trust: Czech National Bank Provides Clarification

    Are you unsure whether a takeover bid is required when a controlling interest in a company is transferred to a trust? The Czech National Bank (CNB) has issued a clarifying statement on this issue.

    Generally, contributing a decisive share of voting rights in a target company – whose shares are admitted to trading on a regulated market – to a trust typically triggers the obligation to launch a takeover bid. The crucial factor is whether this transfer results in a change of control of the target company.

    Who is obligated to make the takeover bid?

    • The trustee is responsible for fulfilling the takeover bid obligation, acting in their own name but on behalf of the trust.
    • The beneficiary or even another person, such as the founder, may also be obligated if they are part of a group of cooperating persons. This may occur if they exert such influence over the trustee that the trustee’s decisions align with their will.
    • Ultimately, the determination will always depend on an assessment of the individual legal rights and factual relationships in the specific case, particularly when dealing with comparable legal arrangements under foreign law.

    Why does transferring shares to a trust trigger this obligation?

    Upon the creation of a trust, the allocated assets become separate and independent property. The trustee exercises ownership rights to the assets in their own name but on behalf of the trust; however, the assets do not belong to the trustee, the founder or the beneficiary. The trustee has full control over the trust’s assets in accordance with the trust’s purpose and its statute.

    The Czech Act on Takeover Bids does not provide an explicit exemption for the transfer of voting rights to a trust. The transfer of voting rights constituting a controlling interest in a target company listed on a regulated market in the Czech Republic from the founder to the trust’s assets leads to a change of ownership, which is a relevant situation that can give rise to a takeover bid obligation under Section 35(1) of the Act on Takeover Bids.

    The concept of cooperating persons

    Under the Act on Takeover Bids, a cooperating person is defined as someone who, in mutual understanding with the offeror, collaborate to gain or assert joint influence over the management or operation of the target company, particularly through the joint and coordinated exercise of voting rights. This mutual understanding encompasses any intentional coordination of actions, whether explicit or implicit, regardless of the specific form it takes.

    In the context of a trust, a certain level of coordination may typically be expected between trustees and beneficiaries, as the trustee manages the trust for the benefit of the beneficiary. If the exercise of voting rights is coordinated in this context, the broad definition of a cooperating person under the Act on Takeover Bids can include the beneficiary. The beneficiary or the founder can be considered cooperating persons, particularly if the beneficiary can give formal or de facto instructions to the trustee that the trustee is obliged to respect. Similarly, the founder’s rights related to oversight or otherwise stemming from the trust’s statute can also establish the status of a cooperating person.

    A group of cooperating persons is defined more narrowly and only includes cooperating persons who hold a share in the voting rights of the target company and the cooperating persons who control that company. Therefore, a beneficiary (or founder) will not be considered part of a group of cooperating persons with the trust unless they have a direct share in the voting rights of the target company or such a share is attributed to them (e.g. if they control a person holding voting rights).

    Relevance to foreign legal arrangements

    While the legal regulations of comparable foreign legal arrangements may differ from the Czech legal framework for trusts, the CNB’s conclusions are broadly applicable, with a stronger emphasis on assessing the specific legal relationships involved. The conditions for triggering a takeover bid obligation for a controlling interest in a company listed in the Czech Republic are assessed according to the Czech Act on Takeover Bids.

    Importance of individual assessment and CNB consultation

    Given the diversity of rights associated with the functioning of a trust, identifying the holder of voting rights and thus the cooperating persons and the group of cooperating persons will always require an individual assessment, primarily based on the statute of the relevant trust. Due to the complexity and individual nature of these cases, the CNB recommends consulting on the parameters of any specific transaction involving the acquisition of a controlling interest in a target company by a trust, including the provision of all relevant information.

    In conclusion, the transfer of a controlling interest to a trust generally triggers a takeover bid obligation in the Czech Republic. The trustee is primarily responsible, but beneficiaries and founders can also be obligated if they form a group of cooperating persons exerting control over the target company through the trust. A thorough assessment of the specific trust structure and related factual circumstances is always necessary.

    By Lukas Tomanek, Senior Associate, JSK, PONTES

  • Landmark Decision by Hungarian Curia on Bank Frauds

    In its recent decision of 19 February 2025, the Supreme Court of Hungary (‘Curia’) overturned the second-degree verdict that held fraud victims solely liable and ruled that financial institutions cannot automatically reject compensation claims. This landmark decision might open the doors for customers to claims against their banks in similar cases.

    Background

    A consumer filed a complaint with the Financial Arbitration Board after the rejection of their reimbursement claim against a bank. The dispute arose when the consumer attempted to sell a product on an online marketplace but was misled by a fake potential buyer to an internet phishing page resembling the bank’s official website. As a result, the consumer became a victim of fraud, leading to an unauthorized transfer of a significant amount from his bank account to an unknown domestic account. The Conciliation Board recommended that the bank reimburse the consumer for the unauthorized payment transaction.

    The bank challenged the recommendation in court. A legally binding judgment overturned the Financial Arbitration Board’s recommendation, reasoning that the bank’s liability depended on whether the consumer had acted with due diligence in safeguarding their authentication credentials. The court examined whether the consumer had provided their credentials to an unauthorized party and, if so, whether they exhibited culpable negligence. The second-degree court ruled that the consumer’s actions constituted gross negligence, thereby exempting the bank from its statutory reimbursement obligation.

    Curia’s verdict

    The Curia, however, emphasized that the second-degree court had incorrectly equated gross negligence with a breach of duty. It clarified that negligence must be assessed individually and with the damage (not the default), considering whether the consumers were subjectively aware of the consequences of their actions and whether they displayed recklessness or indifference toward potential damages. The court also underscored that gross negligence should be evaluated not only based on default but also in terms of the foreseeability of harm. The Curia concluded that the consumer could not have anticipated the damage resulting from the second unauthorized transfer and had not acted with significant negligence. As a result, the Curia reinstated the initial court decision, which had dismissed the bank’s claim, thereby affirming the consumer’s right to reimbursement.

    The above implies that banks cannot automatically pass on the liability for fraud to the consumers based on the objective default of a task, but the general and more subjective clause of foreseeability should be assessed on a case-by-case basis. The judgment also lays down, however, in general terms, the conjunctive conditions under which a bank may be exempted from the obligation to reimburse a consumer for the execution of an unauthorised payment transaction as follows: (i) the customer does not behave in a manner which is normally expected in the circumstances of the case to keep the bank card and the personal identification data secure, and (ii) the failure to comply with the obligation constitutes gross negligence as regards the damage caused.

    Afterlife of a decision

    The decision of the Curia is certainly a step forward in the direction of more effective protection of consumers’ rights, but it also establishes a stricter framework for the banks to avoid liability. This decision, and the ones to follow based on this landmark ruling, may spur financial institutions to enhance their security protocols, taking greater responsibility in preventing financial abuse, since the volume and sophistication of online scams just keep increasing.

    By Balint Zsoldos, Head of Tax, KCG Partners Law Firm

  • Tuca, Zbarcea & Asociatii Successful for CRRC Qingdao Sifang and Astra Vagoane Before CJEU

    Tuca, Zbarcea & Asociatii has successfully represented the association between China-based CRRC Qingdao Sifang and Romania-based Astra Vagoane Calatori before the Court of Justice of the European Union in a case which rendered Emergency Ordinance No. 25/2021 on the exclusion of non-EU economic operators from public procurement procedures ineffective.

    According to Tuca, Zbarcea & Asociatii, the case concerned a public procurement procedure worth approximately EUR 750 million in which a joint venture between a Romanian company and a non-EU one “was excluded following the Romanian Government’s adoption of Emergency Ordinance No. 25/2021. This legislative act imposed the sanction of exclusion for all economic operators from non-EU countries that had not signed a free-market access agreement with the European Union.”

    As Tuca, Zbarcea & Asociatii reports, the Court of Justice of the European Union ruled that “primary EU law precludes a Member State from adopting national legislation excluding an economic operator from a third-country which has not concluded a free-market access agreement with the EU, as such a measure falls within the exclusive competence of the European Union. 

    The Tuca, Zbarcea & Asociatii team included Partner Dan Cristea and Senior Associate Serban Sarbu.

  • Schoenherr Advises Shareholders of Nortec Pharma on Sale of Majority Stake to Frewitt

    Schoenherr has advised the shareholders of Nortec Pharma on the sale of a majority stake to Frewitt.

    The parties have not disclosed any financial details.

    Nortec Pharma, headquartered in Poland, specializes in pharmaceutical processing solutions.

    Frewitt is a Swiss-based company operating in milling and processing technologies for the pharmaceutical industry. According to Schoenherr, this transaction expands Frewitt’s product range and service offering, reinforcing its market position, while marking a strategic move for both companies to enhance their innovative capabilities and market reach. 

    The Schoenherr team included Partners Tomasz Kwasniewski and Szymon Okon, Counsel Dawid Brudzisz, and Associate Witold Oszczanowski.

    Schoenherr did not respond to our inquiry on the matter.

  • Dentons and Vlasceanu & Partners Advise on MET Group’s Green Assets Division on Acquisition of Solar Project in Romania

    Dentons has advised the Green Assets Division of MET Group on the acquisition of an 80-megawatt photovoltaic project in Rascaeti, Dambovita County, Romania, from Austrian solar power developer Kraftfeld Energy. Vlasceanu & Partners advised Kraftfeld Energy.

    According to Dentons, acquired at a ready-to-build stage with an existing engineering, procurement, and construction contract, this project enhances MET Group’s renewable energy portfolio in Romania – which already comprises over 260 megawatt-peak of photovoltaic capacity and 10 megawatts of co-located battery energy storage.

    The Dentons team included Partners Claudiu Munteanu-Jipescu, Bogdan Papandopol, and Raul Mihu, Senior Counsel Oana Voda, Counsels Elena Vlasceanu, Doru Postelnicu, Maria Tomescu, and Argentina Rafail, Senior Associates Angelica Pintilie, Carolina Baloleanu, Andreea Predescu, and Simona Radulescu, and Associates Alin Dimache, Diana Ceparu, Geanina Anghel, Iulia Titirisca, and Carmen Banica.

    The Vlasceanu & Partners team included Partners Loredana Vlasceanu and Raluca Spinu and Managing Associate Dan Oltean.

  • Cezary Cienkowski Becomes General Counsel at Burgundy Capital Management

    Burgundy Capital Management has appointed Cezary Cienkowski as its new General Counsel.

    Burgundy Asset Management provides investment management services.

    Before moving to Burgundy Asset Management in 2025, Cienkowski spent almost 12 years in private practice. Earlier, he was an In-House Counsel with CTL Logistics Group between 2012 and 2014. Earlier still, he was an Associate with Salans between 2010 and 2012 and a Lawyer with Pietrzak Sidor & Wspolnicy between 2007 and 2010.

    “Over the years, I’ve worked with [Burgundy Asset Management Chief Investment Officer] Gabriel Olearnik on a number of deals and disputes, and together we’ve looked at over 430 disputes internationally, with an aggregate value of USD 110 billion,” explained Cienkowski. “We saw there was a gap in the market for the next generation of strategic advice for claimant parties: we work with law firms to bring together legal, litigation finance, and investigations resources. We are not replacing the legal advice but hopefully acting as a force multiplier.”

    Originally reported by CEE In-House Matters.

  • Freshfields Advises Shareholders on Sale of Leiber to Asahi Group Foods

    Freshfields has advised the shareholders of Leiber on the full sale of the company to Asahi Group Foods, a subsidiary of Asahi Group Holdings.

    The transaction remains contingent on regulatory approval.

    According to Freshfields, Leiber is a brewer’s yeast specialist that has been refining innovative product solutions for healthy nutrition, biotechnology, and agricultural applications since 1954.

    Asahi Group Holdings is one of the world’s five largest breweries.

    The Freshfields team included Vienna-based Counsel Lukas Pomaroli and Associate Tensin Studer as well as further team members in Berlin, Duesseldorf, Frankfurt, and Hamburg.

    Freshfields did not respond to our inquiry on the matter.

  • DLA Piper Advises Marinomed on Sale of Carragelose Business to Unither Pharmaceuticals

    DLA Piper has advised Marinomed Biotech on the sale of its Carragelose business to Unither Pharmaceuticals. Lamartine Conseil reportedly advised Unither Pharmaceuticals.

    Unither Pharmaceuticals is a French contract development and manufacturing organization.

    According to DLA Piper, Carragelose, a sulfated polymer derived from red seaweed, is a unique, broadly active compound that blocks viruses and allergens.

    Marinomed Biotech, headquartered in Korneuburg and listed on the Vienna Stock Exchange, is an Austrian biotech company known for the patent-protected Marinosolv platform, which enhances the solubility and bioavailability of poorly soluble compounds for the development of new therapeutics.

    The DLA Piper team in Vienna included Partners Maria Doralt, Sabine Fehringer, Christian Temmel, Marc Lager, Dimitar Hristov, and Stephan Nitzl, Counsel Christian Knauder-Sima, Senior Associate Eric Wingert, and Junior Associates Christian Scheucher and Madeleine Albers.

  • Vladimira Chlandova Becomes Vice President for Legal Affairs, Risk Management, and Corporate Security at T-Mobile Czech Republic and Slovak Telekom

    Former T-Mobile Czech Republic and Slovak Telekom General Counsel and Head of Legal, Regulatory & Compliance Affairs Vladimira Chlandova was appointed as the Vodafone Czech Republic’s new Vice President for Legal Affairs, Risk Management, and Corporate Security.

    Chladnova has been with T-Mobile Czech Republic and Slovak Telekom since 2019 when she joined as General Counsel. Earlier, she was Senior Corporate Counsel with Trelleborg between 2017 and 2019. Earlier still, she was General Counsel & HR Director and CCO UPC Ceska Republika between 1999 and 2016 as well as Chief Legal Counsel at Ringier.

    A graduate of the Faculty of Law at Charles University in Prague, she has also served as the Chairwoman of the Board of the Czech Association of Electronic Communications and as a member of the expert panel at the Czech Telecommunication Office.

    Originally reported by CEE In-House Matters.