The state measures adopted due to the proven presence of a coronavirus called SARS CoV-2 in the Czech Republic affected many legal and natural persons. Most establishments (stores, hotels, guest houses etc.) were closed or their operation radically restricted. The provision of most services was forbidden. Sports, cultural, dance and educational events were cancelled. The state measures restricted or prevented employment and business activities, whether due to limitations imposed on the free movement of persons or due to cross-border transport limitations. Regardless of the legitimacy of some measures, the affected establishments and enterprises suffered damage as a result of those measures.
By its decision ref. No 14. A 41/2020 of 23 April 2020, the Municipal Court in Prague annulled four of the most important measures by the Ministry of Health, holding them to be unlawful. This will have an undeniable effect not only on claims for damages but also on the procedure for exercising such claims.
Anyone wishing to claim compensation for damage incurred as a direct result of the emergency measures must do so within 6 months of becoming aware of such damage, failing which the right will lapse. As a procedural precaution, it is appropriate to submit a claim within 6 months of the moment the first measures restricting the right to carry on business were introduced. Submitting a claim with the competent authority is free of charge, but any court proceedings are subject to fees.
The COVID-19 service includes:
- Assistance in submitting claims for compensation
- Regular updates on the options for compensation
- Consultancy on compensation
- Preparation for the submission of a claim for compensation with the competent authority
- Preparation for the submission of a claim at court if the competent authority does not pay the compensation
- Assistance in quantifying the damage (actual damage and loss of profit)
- Assistance of a cooperating tax advisor (in particular in quantifying loss of profit)
What do we need for a compensation claim?
Evidence of the damage and loss of profit suffered as a result of the emergency measures (in particular evidence of operational expenses and loss of profit)
Such evidence may include invoices, sales and profit records for previous periods, cancelled purchase orders, contracts terminated early (including any related communication), tax returns from previous years, documents detailing the costs incurred in addressing the situation, reservation system outputs, etc.
Any claim needs to be submitted to the competent authority no later than early August 2020.