Community Group – setting up a non-profit entity

Setting up a non-profit organization: a civic association / registered charity (zapsaný spolek, z.s.)

If you are interested in setting up a not-for-profit organisation in the Czech Republic, be reassured it is possible for foreigners to do so and it has been done recently in Brno. The type of not-for-profit organisation most commonly set up is a civic association (zapsaný spolek = z.s.).

Before you begin, keep in mind two key requirements for a civic association:

• it must be founded by and remain composed of at least three people

• it must operate as a not-for-profit, non-commercial, corporate entity, which should serve the interests of its members and/or enable its members to pursue certain public interests (Civil Code Article 217).

An association cannot be established for a purpose that is explicitly commercial in the sense of engaging in entrepreneurship or focusing on profit-generating activity, unless such an activity is an auxiliary one and its purpose is to support the statutory purpose of the association or to enable more efficient use of its property. Any profit generated by such an auxiliary economic activity must be used exclusively for supporting the statutory activities of the association including its administration expenses (Civil Code Article 217). Source: Czech Republic: Non-profit/For-profit Company Registry Requirements

Setting up a civic association (spolek) in the Czech Republic involves several legal steps. The FRANK BOLD organisation has a website (in Czech but you can use the translate function on your computer) that guides people through the process of starting a spolek for free:

• Which association?

• What can be the main and secondary activity of the association?

• How to proceed step by step

1. Establish an association

• Either agree with the other founders on the content of the statutes…

• … or convene a constituent meeting

2. Submit an application for registration of the association in the Association Register

• 1. Fill in the electronic form

• 2. Attach the necessary attachments to the proposal

• 3. Send everything to the registration court

• Previously solved cases

Click on the web link to find out more:  How to set up an association correctly? Take advantage of the Association Founder 2.0 | Frank Bold

If you’re still not sure if your draft of your Articles of Association are alright, feel free to contact our legal consultants.