CEE Legal Matters

Category: Czech Republic

  • Martin Solc Slated to Become First Vice President of IBA from CEE

    Martin Solc Slated to Become First Vice President of IBA from CEE

    Martin Solc – already, as Secretary General, the first officer of the Management Board ever from Central and Eastern Europe – was elected Vice President of the International Bar Association at the organization’s Annual Conference in Tokyo on October 23, 2014. 

    Solc, a founding partner of the highly-regarded Kocian Solc Balastík law firm in the Czech Republic, will assume the second-ranking position in the IBA in 2015 from current Vice President, American David Rivkin, who will become the organization’s President. It is customary – though not automatic – that the Vice President becomes the next President, so it is expected that Solc will replace Rivkin as President in 2017 as well, thereby becoming the first IBA President from CEE.

    Solc was first elected an officer of the Czech Bar in 1990, and he was sent to the IBA’s annual meeting in Venice shortly thereafter. “I started to attend regularly for the first 5-6 years as President or an officer of the Bar,” he explains, “wearing the hat of the Czech Bar.” 

    He continued to attend even after his specific obligations with the Czech Bar ended, and in following years he was elected Co-Chair of the Eastern European forum (1998-2000), Member of the Business Law Council (2000-2004), Co-Chair of the Human Rights Institute (2009-2010), and played important roles in both of the two divisions of the IBA (the Legal Practice Division and the Public & Professional Interest Division), including, from 2006-2008, serving as an officer and chair of the Public & Professional Interest Division – the first lawyer from CEE to head one of the two Divisions. 

    When asked about the demands and obligations of the Vice Presidency, Solc refers first to the significant travel required of the Executive Board. He points out that the IBA itself has over 60 conferences a year, and members of the Executive Board are obliged to represent the IBA to other global organizations as well. Solc says the President often spends up to 7 months a year on the road (he describes the Presidency as “quite a difficult thing”), and part of his role as Vice President will be to go where the President can’t. 

    As a result of these obligations, Solc has already had to sacrifice many of his previous duties with Kocian Solc Balastik. “I completely gave up my role in the management of this firm,” he says, “and I gave up all kinds of marketing activities.” Still, he’s not completely removed from his work in Prague. “I insisted on keeping some part of client work,” he says. “I am a lawyer, and I love it, and I will be trying to work – but I know that during the actual Presidency this will have to be limited even more than today.” 

    Given the time commitment and impact on his practice, it is suggested to Solc  with a smile, that achievements of this kind are often accompanied by a fair amount of ego. Solc accepts the question respectfully and thinks carefully before answering. “To say that there was no element of ego would be untrue,” he answers. “There is always an element of ego involved. If you decide to work in an organization, you put your life into it, this is the natural end horizon of that long journey. You want to do it, you want to complete the job.”

    “But the other part is,” he continues, “you believe you can come up with some good ideas and move the organization to somewhere you think it needs to be. So there is an element of altruism in it, but I can’t say it’s only altruism.” He smiles. “Czechs are low key people who don´t like to speak about pride. My mother is proud – she is 80 and eagerly listens to everything. So that’s the pride. But I hope I’ll be able to contribute – I don’t want to spend time in the office and achieve nothing.”

    Asked what particular achievements he’s hoping to obtain, Solc describes with enthusiasm an initiative he started several years ago to put the IBA online by streaming content from its conferences, to “connect those lawyers around the world who aren’t always able to attend or able to afford to travel.” The “IBA Digital Hub,” Solc notes, was begun in 2012. It is in a beta version now, and he expects it to formally launch on the IBA website in a couple of months.

    Martin Vychopen, the Chairman of the Czech Bar Association, was enthusiastic about the vote, saying, “I would like to extend my warm congratulations to Martin. No Czech lawyer has ever held a higher position in our profession. At the same time, Martin has not forgotten to express the interests of the Czech Bar Association within the IBA and I think it is thanks to him that Czech lawyers have a good reputation on an international level. I hope that the IBA’s tradition – that the Vice-President usually becomes the President – will continue and that Martin will be elected IBA President in 2017.”

    The IBA was established in 1947 by 37 national bar associations. The London-based organization now has over 50,000 individual members, coming from over 200 individual bar associations. It holds over 60 conferences annually, which are attended by more than 5,000 lawyers. The 2014 Annual Conference in Tokyo was opened by the Japanese Prime Minister and the opening ceremony was attended by the Emperor and Empress of Japan. The 2015 Conference will be held in October, in Vienna.

    This Article was originally published in Issue 6 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

  • Phillips Hires New CEE Head of Legal Affairs

    Josef Holzschuster joined Phillips this September in Prague as its new Head of Legal Affairs for CEE.

    Holzschuster has accumulated over 13 years of in-house experience, 12 of which were in the TMT sector. Prior to joining Phillips, he was based in Vienna and worked as the Director of Legal Affairs for CEE at HP until 2013. Before that, he worked as the Head of Legal and Regulatory Department at UTA Telekom AG (now Tele2) for 2 years, 1 year as the Head of Legal at ASFINAG, and 2 years as a Senior Corporate Counsel at Connect Austria. 

    Between July 2013 and September 2014 Holzschuster ran his own Business and Management Consulting & Coaching firm.

  • Kinstellar Advises City of Prague on Anti-Corruption Strategy

    Kinstellar reports that that the analysis of the capital’s anti-corruption strategy and a proposal for further steps the Municipality of Prague has recently announced taking on board were both prepared by the firm’s Prague Compliance, Risk and Sensitive Investigations team.

    Following up on Kinstellar’s analysis, the capital is ready to update and amend its anti-corruption strategy and to develop a long-term strategic program conducive to compliance with anti-corruption measures.

    “Our report considered Prague’s current anti-corruption strategy from the perspective of applicable local and international anti-corruption legislation, the legal environment in the Czech Republic, and best practice recommendations for local government from leading international institutions, including The World Bank and the OECD,” explained Partner Jitka Logesova, head of Kinstellar’s Compliance, Risk & Sensitive Investigations practice.

     

  • Kinstellar Represtents Hyundai Mobis and Nexen Tire in Investment Agreements with Czech Republic

    Kinstellar has advised South Korea’s Hyundai Mobis on the negotiation and conclusion of an investment agreement with the Government of the Czech Republic in support of a new automotive headlight plant in the Mosnov industrial zone in the Novy Jicin district.

    The company expects to create more than 900 direct jobs and to stimulate the creation of additional jobs at Mobis’ local subcontractors. Hyundai Mobis’ investment in the construction of the Mosnov plant will total CZK 4 billion (more than EUR 145 million).

    The investment agreement with Hyundai Mobis was concluded several weeks after the announcement of Nexen Tire Corporation’s investment of more than CZK 22 billion (more than EUR 800 million), which the Government of the Czech Republic approved last month. Kinstellar, which represented Nexen during negotiations with the Czech government, describes that deal as being “the third largest FDI project in the Czech Republic.”

     

  • Kinstellar and A&O Advise on NET4GAS on Capital Structure Refinancing

    Kinstellar and Allen & Overy, among others, have advised on NET4GAS’s optimization of its capital structure, including corporate bonds and bank loans amounting to approximately EUR 1.12 billion. 

    The refinancing follows the acquisition of NET4GAS, the Czech gas transmission system operator, by Allianz Capital Partners and Borealis Infrastructure Management, which was the largest M&A transaction in the energy sector in the Czech Republic in 2013. According to Allen & Overy, “given the nature of the issuer and borrower – NET4GAS – this deal is truly innovative and very specific and demanding because it required, among other things, particular focus on and attention to the regulatory and public procurement aspects, which led to a number of unprecedented complexities.”

    Allen & Overy advised Barclays Bank PLC, BNP Paribas, Ceskoslovenska obchodni banka, Citigroup Global Markets Limited, Credit Agricole Corporate and Investment Bank, Erste Group Bank AG, Komercni banka, Merrill Lynch International, Societe Generale, The Royal Bank of Scotland plc, and UniCredit Bank AG, in their capacity as the dealers, and Citicorp Trustee Company Limited as the trustee, in connection with the establishment of the EUR 5 billion Euro Medium Term Note Program by NET4GAS and the inaugural issuances of EUR 300 million 2.5% fixed rate notes, EUR 160 million 3.5% fixed rate notes and CZK 7 billion 2.25% fixed rate notes (Kinstellar states that this represents the “largest corporate bond issuance denominated in Czech crowns in the history of the Czech Republic”) under that program. The A&O team also advised Bank of America Merrill Lynch International, BNP Paribas, Ceska sporitelna, Ceskoslovenska obchodni banka, Citibank Europe, Credit Agricole Corporate and Investment Bank, Export Development Canada, ING Bank, KFW IPEX BANK, and UniCredit Bank Czech Republic and Slovakia, in their capacity as lenders, and Ceska sporitelna, as the agent, in connection with various loan facilities and related financing arrangements entered into with NET4GAS.

    According to an A&O statement, “by virtue of this deal NET4GAS group has successfully replaced the amount of acquisition debt, which resulted from the change in ownership in 2013, by a less expensive and more transparent long-term capital structure.” 

    The A&O team is being led by London-based Banking Partner Conrad Andersen and International Capital Markets Partners Parya Badie and Tim Conduit, with support from a Prague team consisting of Counsel Robert David and Associates Silvie Horackova, Petra Mysakova, and Petr Vybiral.

    Other advisors on the refinancing included BNP Paribas as financial advisor and Linklaters and Arthur Cox as legal advisors.

    Editorial Note: Several weeks after this article was originally published, Linklaters announced that its team on this matter included Partners Ian Andrews and Mark Nuttall and Managing Associates Alexander Shopov and Ilia Ditiatev.

     

  • KSB Succeeds in Proceedings Before Czech Supreme Administrative Court

    Kocian Solc Balastik has successfully represented the Radio and Television Broadcasting Council (RTBC) before an extended chamber of the Supreme Administrative Court in the Czech Republic, in a case involving the criteria by which a notice from the RTBC can constitute lawful grounds for imposing a penalty. 

    In 2009, the RTBC fined the CET 21 media company for failing to distinguish an ad from a particular show, as the Czech Radio and TV Broadcasting Act requires. CET 21 — which is owned by Central European Media Enterprises, itself a member of the Time Warner Group — sought to have the fine revoked before the Municipal Court in Prague, claiming that the RTBC merely referenced its prior notices without dealing with the specific contents of the case at hand. The Municipal Court in Prague ruled that such notices could not constitute grounds for imposing a penalty.

    However, on behalf of the RTBC, KSB filed a cassation complaint with the Supreme Administrative Court, which considered the matter in its extended chamber, since its previous decisions in the area were in conflict. 

    According to KSB, “The crucial issue concerned the interpretation of this expression: ‘conduct that has the character of conduct that was notified to the operator as unlawful.’ In other words, is it possible to fine a broadcaster for a hidden ad based on a previous notice from the RTBC which, however, concerned a different hidden ad? The Supreme Administrative Court finally agreed with the RTBC’s opinion that such a procedure is admissible. If it were not, it would not be possible to fine broadcasters for unlawful conduct since to be immune from punishment they would merely need to refrain from re-running the particular show.”

     

  • Hogan Lovells’ Dubovsky Joins Weinhold

    Weinhold Legal has announced the addition of Miroslav Dubovsky, the former Managing Partner of Hogan Lovells in Prague.

       

    Miroslav Dubovsky

    Dubovsky has spent more than 20 years of his professional career working with international law firms in Prague, including 2 years as a partner with Linklaters before joining Hogan Lovells in 2001. His practice focuses primarily on mergers and acquisitions including private equity and property law. He is also a highly-regarded international commercial arbitration lawyer, and regularly sits as an arbitrator. His move follows the announcement of Hogan Lovells office to close down its Prague operations effective July 1 (initially reported on by CEE Legal Matters of May 14, 2014)

    In a Weinhold Legal press release, Dubovsky stated: “I am thrilled by the prospect of joining a market leading Czech law firm where I believe I can contribute to its further growth.” And Weinhold Legal Managing Partner Daniel Weinhold said: “We are delighted to have Miroslav join our team. His excellent skills, experience and market reputation further enhance our credentials as one of the leading law firms in the Czech market.”

     

  • KSB Represents Karlovarske Mineralni Vody in Successful Suit

    Kocian Solc Balastik has represented Karlovarske Mineralni Vody in a successful lawsuit to cancel a penalty imposed on KMV by the State Preservation and Landmark Authority for an alleged administrative offense. 

    The penalty imposed by the Landmark Authority related to the Authority’s findings that that KMV had failed to look after, maintain and protect historic buildings in the municipality of Kyselka, in the Czech Republic. KSB filed an administrative lawsuit against the Landmark Authority’s decision on KMV’s behalf at the Regional Court in Plzen, which cancelled the penalty on January 31, 2014 and returned the case to the Landmark Authority for new proceedings. The Landmark Authority then filed a cassation complaint at the Supreme Administrative Court in Brno seeking remedy against the Regional Court’s ruling. The Supreme Administrative Court upheld the original decision to cancel the penalty.

    In its reasoning, the Supreme Administrative Court pointed out that, while the Landmark Authority had stated in its reasoning that the KMV had committed acts that it classified as “delinquency”, it had not referred to the term in the decision itself, and thus the penalty it imposed violated the principle that punishment can be imposed only for deeds listed in the text of the decision. 

    In a statement released by KSB, the firm stated that “simply put, the owner of the building was punished for something which it did not commit according to the decision.” It continued that, “the Landmark Authority inadmissibly simplified the administrative proceedings since if it said delinquencies were included in the decision it would be obliged to describe the particular deeds and, primarily, would have to prove that KMV actually committed such deeds. By failing to do so, the Landmark Authority substantially limited KMV’s right of defense.”

    The case has been returned to the Landmark Authority for re-consideration. 

     

  • Dentons Hires New COO for Europe

    Richard Singer, the former Chief Operating Officer for Central & Eastern Europe and EMEA Director of Strategic Projects at White & Case, has left the White Shoe firm to join Dentons in Prague. Singer joins the firm as Chief Operating Officer for Europe.

    After graduating from the University of Economics in Prague in 1999, Singer joined Arthur Anderson, and he spent seven years with Ernst & Young as Sales Director, Directors of Business Development for first Eastern Europe and then Central & Southeast Europe. He had been with White & Case since May, 2009.

    The news of Singer’s departure comes less than two months after the news that White & Case’s Head of HR for EMEA left the firm to join Eversheds in London. 

  • KSB Prepares “Unique Legal Arrangement” for J&T Bank’s Perpetual Bonds

    Kocian Solc Balastik (KSB) has advised J&T Banka on what it calls a “unique legal arrangement” in the Czech Republic: issuing bonds that offer investors a fixed yield with no maturity date. 

    J&T Banka is a Czech private full-service bank that was established in 1998.

    According to KSB, “stricter requirements on a bank’s capital structure have resulted in banks issuing hybrid instruments such as perpetual bonds, which are counted as Tier 1 capital. This marks the first time such an instrument has ever been issued in the Czech Republic. A number of issues had to be resolved beforehand, however, such as the legal structure and acceptability for the regulator.”

    The firm reports that preparation work for perpetual bonds was more challenging than that for standard securities, but the process “culminated at the end of June 2014 when the Czech National Bank approved the prospectus and the perpetual bonds were offered to preselected investors.” KSB reports that interest of the preselected investors is said to be strong.