Category: Czech Republic

White & Case has advised the PPF Group on its acquisition of a 15% shareholding in InPost from Advent International for EUR 10 per share. Weil, Gotshal & Manges advised Advent.

InPost is a European automated parcel machine service provider listed on Euronext Amsterdam.

According to the PPF Group, “together with previous purchases of InPost shares on the open market, the group currently holds an aggregate shareholding representing 16.75% of the InPost share capital. Under the agreement with Advent, PPF has the option to buy a further 15% stake in InPost from Advent.”

“With this investment, we have taken a major step towards strengthening the e-commerce sector in which PPF has long been active,” PPF Group Chief Investment Officer Didier Stoessel said. “E-commerce is one of our four main investment pillars, along with financial services, telecommunications, and media. As a major shareholder, we are committed to contributing to the international expansion of, and value generation by, InPost, one of the most dynamic companies in its sector.”

Back in 2019, White & Case advised the PPF Group on several mandates, including its EUR 500 million note issuance (as reported by CEE Legal Matters on November  27, 2019); the establishment of its EUR 3 billion Medium Term Note Program and debut issuance of EUR 550 million 3.125% notes due March 2026 (as reported on April 9, 2019); the sale of its stake in Telenor Hungary (as reported on November 7, 2019); and its USD 2.1 billion acquisition of Central European Media Enterprises (as reported by CEE Legal Matters on November  6, 2019).

The White & Case team included Prague-based Partners Jan Andrusko and Jan Stejskal with further team members in London and Luxembourg.

The Weil team was led by London-based Partners David Avery-Gee, Sarah Flaherty, and Patrick Brendon.

Glatzova & Co has advised Pale Fire Capital and Tomas Kacena on their full sale of Extra Online Media to Burda International CZ. Novalia advised Burda International.

Founded in 2015, Pale Fire Capital is a private equity firm headquartered in Prague.

Extra Online Media, an internet publishing house founded in 2013, reaches nearly five million users per month.

Burda International CZ is the Czech subsidiary of German holding Hubert Burda Media.

According to Glatzova & Co, Extra Online Media CEO Tomas Kacena – who sold his 25% stake – will retain his position within the company.

Novalia’s team included Partners Pavel Marc, Tereza Jandackova, and Kamil Stanek and Associate Vojtech Tancos.

Just in time for Children’s Day, the dreams of many adult inventors came true!

From 1 June 2023 they will no longer have to apply for a patent for their invention in each European country separately but can obtain one patent for the whole of Europe. What’s more, they can bring infringement claims against their existing “classic” European and new “Unitary” Patents before a single, specialised court.

The Unified Patent Court Agreement is coming into force today, and although the Czech Republic is waiting to ratify it, it will also affect Czech inventors and research organisations based in the Czech Republic. Not only can they apply for the European Unitary Patent with effects in 17 European countries where ratification has already taken place (e.g. Germany, France,Italy), but they no longer have to litigate their patent rights in parallel before several institutions.

The Unitary Patent system also has a number of disadvantages. For example, it does not allow the patent to be abandoned in countries where it has not met commercial expectations and where the payment of annuities has become unreasonable, and the possibility of geographically limiting the effects of the transfer of the patent is removed. These and other pros and cons will need to be considered when planning a patent strategy.

By Hana Cislerova, Associate, JSK Law firm, PONTES

Former IBM Associate Partner Marcela Kanova has returned to private practice by joining Rowan Legal as a Partner in Prague.

Originally reported by CEE In-House Matters.

Glatzova & Co has advised J&T Bank on a CZK 700 million Trigema Real Estate Finance publicly offered senior secured bond issuance.

J&T Bank was the manager, administrator, and listing agent. J&T IB and Capital Markets was the arranger of the issuance.

Trigema Real Estate Finance is part of the Trigema group, a primarily development and construction company.

According to Glatzova & Co, “the bonds will be listed on the Prague Stock Exchange. The Czech National Bank approved the prospectus on May 26, 2023, and its approval became effective on May 29, 2023.”

Glatzova & Co’s team included Partner Libor Nemec, Managing Associate Jarmila Tornova, and Junior Associate Jan Losenicky.

On 24 May 2023, the European Commission published “the most ambitious legislative proposal since the inception of EU financial regulation “, as the Commissioner for Financial Services Mairead McGuinnes described the proposal for a directive as regards the retail investor protection rules (Retail Investment Package).

The main goal of the proposal is to enhance the position of the consumer as a retail investor, so that the consumers can make better and confident decisions about their investments.

The new rules will be reflected, for example, in the Insurance Distribution Directive (IDD), the taking-up and pursuit of the business of Insurance and Reinsurance Directive (Solvency II), the Undertaking for Collective Investment in Transferable Securities Directive (UCITS), the Alternative Investment Fund Managers Directive (AIFMD) and in the Markets in Financial Instruments Directive (MiFID II).

One of the most interesting aspects of the proposal is the long-awaited revision of the existing rules set out in the Insurance Distribution Directive (IDD), especially in the context of product governance and marketing communication in relation to investment products.

By Michaela Šmotková, Associate, and Iva van Leeuwen, Junior Lawyer, JSK Law Firm

Reals has advised Fio Financial Group’s investment company on Fio Real Estate Fund’s EUR 31.3 million acquisition of the Rohan Business Center office building in Prague from Reico CS Nemovitostni. Wilsons advised the seller.

According to Reals, the Rohan Business Center in Prague-Karlin is located near the Krizikova station on metro line B. An eight-story building from 2012 with a total area of approximately 9,434 square meters, it has 100 underground parking spaces.

Collective investment fund Fio Real Estate Fund is a retail real estate fund primarily focused on commercial real estate investments in the Czech Republic and Slovakia.

Ceska Sporitelna subsidiary Reico is a Czech investment company operating in the Central Europe region.

“The disposal of the Rohan Business Center proves the liquidity of our real estate portfolio at existing valuations, helps in optimizing our sector allocation, and provides additional funds for future acquisitions,” Reico CEO Tomas Jandik commented.

The Reals team included Partner Miroslav Dudek and Attorney-at-Law Filip Balousek.

The Wilsons team was led by Partner Alan Spanvirt and Attorney-at-Law Juraj Piatka.

The legal environment in the Czech Republic is currently undergoing significant changes, primarily focusing on the implementation of the NIS2 cybersecurity Directive, whistleblowing legislation, tax reform, and class actions, according to Rowan Legal Partner Josef Donat.

“The implementation of the NIS2 cybersecurity Directive has sparked extensive discussions,” Donat notes. “The regulator for cybersecurity has published the first draft of the resolution, according to which the transition from NIS1 to the new act will significantly increase the number of governed entities from 500 to 6,000, creating a vast market with new obligations and compliance requirements. As a result,” he notes, “we anticipate a lot of work and new clients in the coming 12 to 18 months.”

“The implementation of whistleblowing measures has been slightly delayed, but a new law is expected to come into effect in August,” Donat continues. “With the law nearing implementation, clients are now becoming aware of their obligations and are keen to establish comprehensive whistleblowing systems within their companies.”

“In addition, there is a significant tax reform underway, which holds great importance from a legal standpoint,” Donat adds. “The introduction of new legislation, encompassing a substantial amount of content, is expected. These changes include various tax increases and decreases, which will have implications for businesses and individuals,” he says.

Furthermore, Donat emphasizes that there is anticipation surrounding the finalization of regulations on class actions: “As of now, the details are not yet finalized, and the legal community eagerly awaits the official version, including crucial aspects such as the opt-in and opt-out decision. This development has the potential to significantly impact how disputes are handled and resolved by lawyers. The final wording, as determined by the Ministry of Justice, will definitely be of interest to legal professionals in the field.”

Another major talking point in the Czech Republic is the impact of AI, specifically ChatGPT, on legal services. “Recently, the bar expressed concern regarding the use of ChatGPT, and AI tools in general, for providing legal services,” Donat points out. “The discussions are expected to continue for several weeks as there are concerns about the potential issues surrounding its daily use by some colleagues, particularly in meeting the necessary requirements.” He explains “there are concerns that the majority of AI tools currently available may not comply with bar regulations, especially concerning confidentiality. However, it is interesting to see how things will unfold and how the regulations in this area will develop.”

Finally, Donat points out “the Czech Data Protection Authority has imposed the highest fine ever recorded, amounting to EUR 13.7 million, which is one of the 20 highest GDPR fines ever imposed by EU authorities. The recipient of this substantial penalty is Avast, a company that merged with Norton a few years ago.” He highlights that “Avast was found guilty of selling customer data to third parties, a significant issue in the Czech Republic. The magnitude of the fine has shocked everyone, as there is no precedent for such a substantial penalty in our country,” he notes. “Even though this is a first-instance decision that was appealed, it is our hope that companies will become more cognizant of the importance of data protection in light of this high-profile incident.”

Kinstellar has advised the founders of Czech crowdfunding platform Roier on an investment from Jan Blasko and Jiri Wallenfels. Finreg Partners advised the investors.

Established in 2021, Roier is a Prague-headquartered crowdfunding platform connecting investors and business projects that require additional funding sources.

“Crowdfunding is clearly a modern financing trend and I am happy to become part of Roier and to be able to support its ambition to be a recognized player in this market,” Jan Blasko commented.

The Kinstellar team was led by Partner Kamil Blazek and Counsel Martina Brezinova and included Managing Associate Michal Kniz and Senior Associate Jakub Stastny.

The Finreg Partners team was led by Partner Ondrej Mikula and included Partner Jan Sovar and Associate Marketa Valuskova.

Glatzova & Co has advised Vitkovicke Slevarny on restructuring 16 loans – provided by Ceska Sporitelna, CSOB, Komercni Banka, and UniCredit Bank – amounting to almost CZK 600 million in total. Havel & Partners advised the banks.

Vitkovicke Slevarny is a Czech foundry, with a cylinder foundry division and a casting foundry division, located in an industrial complex in the Dolni Vitkovice area in Ostrava.

According to Glatzova & Co, “as part of the restructuring, four new loans in the amount of almost CZK 100 million were secured by the EGAP guarantees within the so-called EGAP Plus program. Our client was one of the first entities to use this program ensuring greater availability of liquidity to exporters affected by the war conflict in Ukraine.”

“Banks participated in these loans on a pari passu principle,” the firm informed. “The restructuring of the company included, for example, reaching an agreement among bank creditors, key suppliers, and the owner’s group as, without their support, the plan would not have been possible. The necessary cash flows needed for the restructuring process were carried out in the form of attorney escrows provided by our office.”

Glatzova & Co’s team included Partner Libor Nemec, Counsel Vaclav Zalud, and Junior Assistant Tomas Farnik.

The Havel & Partners team included Partners Filip Cabart and Dusan Sedlacek, Managing Associate Stepan Cerny, and Senior Associate Jan Kralicek.