Can an other legal entity be the founder of a Czech company?

Yes, a Czech company can be founded by another legal entity, including a foreign one.

Czech law allows other legal entities to purchase shares in existing Czech firms and establish new ones. In simple terms, a corporate legal entity (including a foreign one) can be the founder of a Czech company without restrictions based on its jurisdiction.

This founding legal entity is always represented by its company director, who signs all necessary documents. For the registration process, you must provide proof of the corporate founder's legal existence and identify its director, confirming the person has the power to represent it.

There are two scenarios:

• The founding legal entity is also registered in the Czech Republic. In this case, the procedure is simple: the Trade Register will automatically verify the company's details during the registration process, so you won't need to submit any extra paperwork.
• The founding legal entity is foreign. The process here is more complicated: you must provide documented proof of the foreign company's legal existence and the identity of its director. This is usually done with a legal entity extract listing all its details. The Czech authorities require a physical copy with a wet ink stamp (digital documents from abroad are rarely accepted). Additionally, an apostille is often needed (check the requirements for your country here). Based on our practice, obtaining a simple, all-inclusive extract is not possible from every jurisdiction, potentially creating difficulties. It is also important to note that appointing a foreign entity as a founder can be expensive due to the expenses associated with getting the documents and their translations. 

If you are considering using another firm as the founder of your Czech legal entity, please get in touch with us. We can advise on the best course of action for your case.