Category: Issue 12.1

Peterka & Partners Partner Adela Krbcova talks about labor in 2025 in the Czech Republic.

CEELM: What are the likely most important labor legislative updates you expect in the Czech Republic in 2025?

Krbcova: We are preparing for a new amendment to the Labor Code, known as the “Flexi Amendment.” The purpose of the amendment is to stimulate the labor market, for example, by extending the probationary period or shortening the notice period in certain cases and adjusting its duration.

The amendment also introduces some positive changes for parents, such as the opportunity to be employed during their parental leave under flexible arrangements for the same scope of work as in their standard employment contract.

Partial changes, such as the right to paid leave in the case of invalid dismissal, easier electronic delivery of salary statements, the possibility of being paid in foreign currency for a wider category of employees, and some other changes are also on the table. The Flexi Amendment is likely to affect occupational health services and abolish the much-criticized entrance medical checks for light work.

In addition to the Flexi Amendment, employers should also begin to familiarize themselves with the requirements of the new Pay Transparency Directive, which is not due to be implemented until 2026 but its introduction will require more in-depth preparation for many employers. Implementation work is progressing at different rates across the European Union, which means that multinational companies may be interested in the regulation before it is adopted locally in the Czech Republic.

I should not forget to mention the abolition of lay juries in district courts dealing with labor cases.

CEELM: Of the above, which ones are you/your clients most excited about and why?

Krbcova: I dare say that some clients have been, and may still be, looking forward to the “dismissal without cause” that a group of MPs are trying to push through in the Flexi Amendment. This would be a ground-breaking innovation, as at present employees can only be dismissed for statutory reasons and under strict conditions. The employee would not leave empty-handed, but roughly with six months’ severance pay. However, it is unlikely to be implemented in an election year.

CEELM: On the flip side, which ones are you/your clients dreading the most and why?

Krbcova: Concerns may be raised by many employers about the administrative burden of the announced Pay Transparency Directive, particularly in terms of reporting. Increased transparency in this area may also run counter to the traditional notion that pay is not discussed much in the workplace, and in some companies’ confidentiality clauses have even been used specifically in relation to one’s own pay. Prohibition of such agreements is likely to be included already in the Flexi Amendment.

Personally, I look forward to the implementation of the Pay Transparency Directive. I believe that a proper and timely review of the organizational structure, job descriptions, and pay systems within employers, and, in some cases, the attitudes of their stakeholders, will not only facilitate the implementation of the requirements of the directive next year but will also contribute to a better setting and understanding of the labor agenda as a whole.

I can’t say that there’s anything to fear in 2025 from a labor perspective. I am more curious about how labor inspectorates will use their new powers to assess illegal work and disguised employment, especially whether they will actually publish decisions on offenses in this area on the official website of the State Labor Inspectorate.

CEELM: What trends do you expect will impact the work of labor lawyers in the Czech Republic the most in 2025?

Krbcova: The trend toward digitalization of the labor agenda is certainly continuing, and there is even the first glimmer of judicial practice where the court has recognized the conclusion of a contract via the Docusign platform as legally sound. Although this was not an employment or Supreme Court case, it is a good sign for HR and employment lawyers alike. Nevertheless, when digitalizing the HR agenda, and, in particular, practicing the electronic delivery of important documents, it is necessary to be careful and set everything up properly so that the employer can meet the burden of proof in the event of a dispute. Similarly, the implications of the GDPR and cybersecurity should not be forgotten. Another trend is, and will continue to be, the rise of AI.

CEELM: What are the biggest challenges faced by employers in the Czech Republic at the moment, and to what extent do you expect these challenges to be addressed this year?

Krbcova: A major challenge for Czech employers remains the shortage of labor in almost all sectors due to low unemployment and strict immigration laws which, despite some partial changes, continue to make it difficult to employ foreigners from third countries.

This article was originally published in Issue 12.1 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

Wolf Theiss Counsel Agnieszka Nowak-Blaszczak and Associate Oliwia Pecht talk about labor in 2025 in Poland.

CEELM: What are the likely most important labor legislative updates you expect in Poland in 2025?

Nowak-Blaszczak: 2025 is expected to bring challenges for employers, with several new regulations on the horizon. These include an amendment to the Labor Code changing the provisions on mobbing, a new law on collective bargaining agreements, a new law on the conditions of permissibility of entrusting work to foreigners in Poland, giving labor inspectors the power to reclassify civil law contracts as employment contracts, and the implementation of the Pay Transparency Directive. Two draft amendments to the Labor Code have been presented. The first, which partially implements the Pay Transparency Directive, has already been submitted to Parliament. The draft is stricter than the directive – it mandates that employers disclose salary information in job postings, whereas the directive merely necessitates that this information be shared prior to the job interview. It also requires employers to respond to employee requests for salary information within 14 calendar days (versus a two-month period). The second was published by the Government Legislation Center in February 2025 and introduces a new simplified definition of mobbing – understood as persistent harassment of an employee that is repetitive, recurrent, or permanent. The draft establishes the employer’s obligation to proactively and continuously prevent mobbing and outlines the specific measures that should be taken. It also specifies that the minimum compensation for mobbing should not be less than six months of the employee’s salary. The draft is criticized because some of the wording raises questions of interpretation (there is a chance that the ambiguous language will be revised).

Pecht: The aim of the new law on collective agreements is to streamline procedures, make negotiations more dynamic, and create a more transparent and adaptable framework for concluding collective agreements. It places considerable emphasis on promoting social dialogue, improving the alignment of working conditions, and facilitating more regular reviews of existing agreements. Moreover, the lower chamber of the Polish parliament has adopted a law regarding conditions of permissibility of entrusting work to foreigners in Poland. The aim is to limit the abuses that occur, streamline the procedures for entrusting work to foreigners, reduce the backlog of cases handled by the offices, and fully digitize the proceedings.

CEELM: Of the above, which ones are you/your clients most excited about and why?

Pecht: Employees and workers’ rights advocates generally support the enhanced enforcement against false self-employment, as it could lead to better social security protections and reduce unfair competition in the labor market. Employers who already prioritize compliance with employment law may welcome clearer guidelines on contract classification.

CEELM: On the flip side, which ones are you/your clients dreading the most and why?

Pecht: A potential update that has raised controversy is granting labor inspectors broad powers to convert civil law contracts into employment contracts if they determine that the criteria for an employment relationship are met. The aim is to protect employees from abuses and the circumvention of labor law and social security regulations.

Nowak-Blaszczak: Many employers oppose giving labor inspectors such powers, arguing that they should be left to the courts. Converting a civil law contract into an employment contract on the basis of an immediately enforceable arbitrary decision creates a risk for employers and the need to go to court to defend themselves. This could result in numerous court cases.

Pecht: Businesses that rely on flexible collaboration models fear that a stricter approach to contract reclassification could limit their ability to structure work arrangements efficiently and increase compliance risks.

CEELM: What are the biggest challenges faced by employers in Poland at the moment?

Pecht: Provided the legislation comes into force we’ll likely see a rise in disputes over contract reclassification. Additionally, companies will require more proactive legal strategies to ensure compliance with evolving labor regulations. Employers are currently struggling with rising labor costs, contractual uncertainties, and increased regulatory control. The planned labor inspectorate powers’ expansion could exacerbate concerns around workforce structuring. Whether these challenges will be adequately addressed depends on the final wording of the reform and its enforcement.

Nowak-Blaszczak: Under the  Pay Transparency Directive, employers with more than 250 workers will report on their gender pay gaps the first time in 2027. For that reason, we are likely to see an increased demand to review and assess pay structures and pay progression, identify any existing gaps, and determine how to address these gaps already in 2025.

This article was originally published in Issue 12.1 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

Komnenic & Partners Managing Partner Milos Komnenic and Partner Nemanja Radovic talk about real estate in 2025 in Montenegro.

CEELM: Looking ahead to 2025, which segments of the real estate market do you anticipate will see the most activity in 2025?

Komnenic: Tourism and construction – particularly, real estate development – represent Montenegro’s two most significant industries. These industries are closely interlinked, as the largest construction projects are typically developed within the tourism sector or serve tourism-related purposes.

CEELM: How do large-scale tourism-related projects influence broader real estate development in the country?

Radovic: The development of major tourism projects such as Porto Montenegro, Porto Novi, and similar projects has had a far-reaching impact beyond the construction of these complexes, contributing to the development of entire regions or even cities where they are located. This has been achieved through the development of numerous residential, commercial, infrastructural, and other facilities. Consequently, the growth of tourism in recent years has significantly driven the expansion of the real estate industry.

CEELM: What are the main legislative updates, whether recent or on the horizon that will impact real estate in Montenegro in 2025?

Komnenic: Certain measures were undertaken by the Government of Montenegro in the past year, and some are planned for the current year, which will impact real estate in Montenegro. Some pose a potential threat to the real estate sector and particularly further development of the tourism sector, which could, in turn, have a detrimental impact on real estate development.

Specifically, in the previous period, the value-added tax rate applicable to the hospitality sector was increased from 7% to 15%, directly affecting the competitiveness and attractiveness of Montenegrin hospitality businesses compared to rival destinations. Additionally, the VAT exemption on the supply of goods and services for the construction and furnishing of five-star hotels has been abolished. Moreover, a new charge for utility infrastructure development for four- and five-star hotels is currently under consideration, along with the potential rumor about the abolition of the condo-hotel model – both of which would serve as further disincentives for investors in the tourism sector.

The issue of the utility infrastructure charge is particularly contentious since, despite being legally obligated to pay these fees, investors are frequently compelled to develop their own infrastructure, endure lengthy administrative procedures to obtain necessary approvals, and bear substantial costs to ensure the provision of essential utilities for their properties.

Radovic: The cumulative effect of these adverse regulatory changes could and will significantly affect the development of high-end tourism, which, as previously mentioned, is a key driver of growth across multiple industries, including real estate.

In the following days, the Parliament of Montenegro will adopt the new Construction Law and Planning Law – after decades, dividing them into two regulations. Rumor has it that there are hundreds of amendments so we cannot yet comment on the final text.

It is evident that these new regulations aim to replace the current construction notifications with construction permits, return usage permits instead of supervisory final reports, and overall return to an old approach that was ineffective in many aspects, particularly in terms of administrative delays.

CEELM: What are other challenges faced by developers in Montenegro at the moment? How likely is it in your view that these challenges will be addressed in 2025?

Komnenic: In addition to these regulatory challenges, Montenegro faces a serious shortage of urban planning documentation necessary for development. The prolonged delays in adopting new spatial plans, new changes in the planning law, and the frequent changes in the decision-making practices of competent authorities create further obstacles, making it increasingly difficult for investors to proceed with real estate projects.

Furthermore, geopolitical uncertainties on the global stage could have a negative impact on small markets such as Montenegro, particularly regarding foreign investments, which are essential for continued growth and development.

Radovic: Given the current market demand, it is likely that the number of residential real estate projects will continue to grow in 2025, despite the aforementioned challenges. However, in the long term, adverse effects on tourism could significantly impede further real estate development.

Therefore, it would be advisable for policymakers to implement measures that incentivize investment rather than introduce regulatory changes that could further deter investors from committing capital to the Montenegrin market.

This article was originally published in Issue 12.1 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

MGG Law Partner Dino Gliha talks about TMT in 2025 in Croatia.

CEELM: What is in the pipeline in terms of legislation that you believe will have the most impact on TMT practices in Croatia?

Gliha: There are three key legislative updates in the TMT space that I’d highlight for Croatia. First, there’s the Media Act, which has been under discussion for the last 2-3 years. While no official draft has been published yet, leaked documents from working groups have sparked concerns about potential challenges to media freedom. The supervisory council overseeing the act might have an expanded scope, which has led to heated debates. Journalist associations and stakeholders are particularly worried, and we’ll likely see the first draft by the end of this year. This is definitely something to watch closely, especially as we move into 2026.

Second, there’s the Act on Representation in the Field of Intellectual Property Rights. This act is a bit outdated, and after long discussions, it’s finally on the legislative agenda. A working group has been formed, but we’re still waiting to see the proposed amendments. Most of the changes are expected in the latter part of the year. The act would most likely introduce amendments implementing EU laws but could review prescribed requirements for professionals entering the field. It might be a significant development for IP practitioners.

Lastly, there’s the implementation of EU regulations, particularly DORA and the AI Act. While DORA is already in force, the AI Act is set to take full effect in 2026. The AI Act focuses mainly on transparency, and the ethical use of AI, while many significant questions related to AI that should have been clarified remained outside the scope of the regulation. There’s still a lot of confusion in the market about its obligations. Many clients are unaware of what’s required, and there’s a lack of clear guidelines. This is a major area of focus, especially as AI adoption grows across industries.

CEELM: Of the above, which ones are you/your clients most excited about and why?

Gliha: Is anyone ever excited about new regulations? The Act on Representation in the Field of Intellectual Property Rights is more of a concern for practitioners like us. The changes concerning the Media Act seem to be something that people in media are not thrilled about, given the fears around media freedom. However, the AI Act and related regulations are generating a lot of discussion. Clients are starting to become more aware of AI’s potential, and there’s a lot of curiosity about how to leverage it while staying compliant. While it’s not exactly “exciting,” it’s definitely the most talked-about topic, especially as businesses explore AI-driven solutions.

CEELM: On the flip side, which ones are you/your clients dreading the most and why?

Gliha: The AI Act is probably the most daunting for clients. The main issue is the lack of clarity around obligations. If you ask five experts about compliance, you’ll likely get five different answers – similar to what happened with the GDPR in its early days. Many SMEs, in particular, are worried about the potential costs and risks of non-compliance. There’s also a lot of confusion about what constitutes AI and who will actually fall under the scope of the act. Clients love innovation but are hesitant to take on big risks, especially in the early stages of implementation. Without clearer guidelines, there’s a lot of uncertainty, which is causing anxiety.

CEELM: In which sectors relevant to your practice do you expect to see the most work in 2025 in Croatia? What do you believe will drive that work?

Gliha: I expect to see a lot of activity in sectors like science, IT, music, even chemistry, and agriculture, as these industries are increasingly exploring AI applications. AI is ultimately a tool that can be applied across various fields, and many clients are now trying to figure out how to integrate AI solutions while complying with new regulations. For example, companies working with IP rights are looking into how AI can streamline their processes, but they’re also concerned about compliance and ownership issues.

The drive behind this work is the growing awareness of AI’s potential and the need for strategic digital transformation. Clients are asking for AI readiness assessments and guidance on how to implement solutions without running afoul of regulations. AI is reshaping industries, and it’s fascinating to be part of that transformation.

This article was originally published in Issue 12.1 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

Linklaters Warsaw Head of TMT/IP Szymon Sieniewicz talks about TMT in 2025 in Poland.

CEELM: What is in the pipeline in terms of legislation that you believe will have the most impact on TMT practices in Poland?

Sieniewicz: The regulatory landscape for TMT in Poland is undergoing significant changes, driven by both EU-level legislation and domestic legislative initiatives such as the AI Act. Some of its obligations became applicable already in February 2025, though most obligations will take effect on August 2, 2026.

The new Polish law on AI systems, which aims to align Polish laws with the AI Act, is still in progress. It covers aspects such as the appointment of the national supervisory authority, proceedings before that authority, and certification processes.

Poland is also taking steps toward implementing the EU’s NIS2 Directive, which enhances cybersecurity requirements for critical sectors across the EU. Since the implementation of the NIS1 Directive in 2018, there have been dozens of draft laws amending the Polish Act on the National Cybersecurity System. The law implementing the NIS2 Directive in Poland is expected to reach Parliament by the end of Q1 2025.

Furthermore, since DORA entered into force on January 17, 2025, both the financial sector and ICT service providers need to adapt to enhanced standards in the area of digital operational resilience. In February 2025, the Polish Financial Supervision Authority repealed and revoked several soft laws that previously set the cybersecurity framework for the financial sector in Poland.

The newly adopted Data Act is one of the EU legal acts that are intended to support better use of the potential of the constantly growing amount of data in Europe and to support the creation of a single market for data in the EU. The Data Act will apply from September 12, 2025. Its primary objectives are to ensure fair access to data and its use between individual market participants in the digital economy, stimulate competition in the data market, and increase the availability of data.

There is also ongoing work on the new Polish Data Governance Act, which, among other things, will expand the catalogue of possibilities for public sector data reuse by the private sector. This should lead to the implementation of the EU Data Governance Act. We expect the new law to be adopted in H1 2025.

CEELM: Of the above, which ones are you/your clients most excited about and why?

Sieniewicz: Clients in the TMT sector are particularly excited about the AI Act, as its phased implementation provides opportunities for organizations to leverage artificial intelligence in a safer and more structured manner.

Furthermore, the draft Polish Data Governance Act is receiving attention due to its potential to expand the opportunities for reusing public sector data. Through greater data accessibility, it encourages collaboration between the public and private sectors, potentially leading to innovative data-driven solutions and services.

CEELM: On the flip side, which ones are you/your clients dreading the most and why?

Sieniewicz: Many clients are concerned about the compliance burdens associated with the new EU digital legislation, especially the AI Act and the NIS2 Directive. The implementation of the former will pose many challenges with questions around the interpretation of concepts in the act (e.g., “AI system”, “prohibited AI practices”). The European Commission’s guidelines are expected to be helpful in this area, it is, however, already clear that they do not address all our clients’ doubts and questions. Moreover, there are concerns about data privacy and copyrights. In these areas, we observe continuous developments, particularly by tracking ongoing litigations in the US and EU countries.

The implementation of the NIS2 Directive is causing apprehension among some clients. Although enhancing cybersecurity is essential, the increased compliance requirements pose significant challenges. The necessity for substantial investments in cybersecurity infrastructure and personnel training may lead to increased operational costs. The new cyber laws are expected to affect tens of thousands of Polish businesses. These procedural adjustments, along with the need to establish new supervisory bodies (e.g., overseeing compliance with the AI Act), could lead to uncertainties in compliance and increased administrative burdens.

CEELM: In which sectors relevant to your practice do you expect to see the most work in 2025 in Poland? What do you believe will drive that work?

Sieniewicz: Technology companies (big tech, software houses, gaming studios) will likely see an increase in demand for legal services due to the expected growth of the sector and emerging new regulatory compliance obligations. On the other hand, organizations implementing new technologies, including AI tools, will increasingly seek legal assistance as they begin to leverage these innovations. Additionally, there is a potential for increased tech M&A activity, indicating growing interest from clients investing in technology.

We expect cybersecurity matters to keep TMT lawyers busy this year. The critical sectors (energy, transport, healthcare, etc.) are also poised for an increase in TMT work due to the expected implementation of the NIS2 Directive. This will also affect new sectors such as public electronic communications services, social platforms, wastewater and waste management, etc., while the financial sector will also need to continue with DORA’s implementation.

This article was originally published in Issue 12.1 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.