Úprava nekalých obchodních praktik schválena Poslaneckou sněmovnou

Modification of unfair commercial practices approved by the Chamber of Deputies

On 30 September 2022, the Chamber of Deputies adopted a bill amending Act No. 395/2009 Coll., previously referred to as the "Act on Significant Market Power in the Sale of Agricultural and Food Products and its Abuse", renamed the "Act on Significant Market Power and Unfair Commercial Practices in the Sale of Agricultural and Food Products" (the "Act") on the basis of the amendment.

We informed you about the expected content of this amendment to the Act a few months ago (e.g. HERE). The original wording of the amendment to the Act was not much affected by the amendments. In particular, the most significant change is the addition of a list of acts that are considered unfair commercial practices for customers with significant market power. The new unfair commercial practice will thus include, for example, the false indication of the country or place of origin of agricultural products or food products or the false indication of the country or place of origin of one or more ingredients of an agricultural product or food product that make up more than 50% of that product or product.

The amended wording of the Act further expands the definition of an entity with significant market power to include not only a customer whose annual turnover falls within one of the five turnover bands set out in the Act, but also (i) a customer whose annual turnover in the Czech Republic exceeds CZK 5 billion, (ii) a buyer who is a controlled person whose annual turnover in the Czech Republic does not exceed CZK 5 billion if its turnover together with the turnover of the controlling person exceeds CZK 5 billion, or (iii) a purchasing alliance whose members' combined turnover in the Czech Republic exceeds CZK 5 billion.

The approved amendment to the Act has been forwarded to the Senate, which will continue the normal legislative process. Given that the amendment to the Act transposes the European Directive on unfair commercial practices between undertakings in the agricultural and food supply chain (Directive 2019/63) into the Czech legal system, with the amendments adopted on the basis of this Directive due to come into force on 1 November 2021 at the latest, it can be assumed that the amendment to the Act will be adopted. The amendment is to come into force on the first day of the second calendar month following its promulgation.

The parties to contractual relations affected by the Act will have 12 months from the date of entry into force to bring contracts concluded under the current legislation into line with the amended legislation.

We are monitoring further developments in the legislative process on this matter and will keep you informed. If you would like further information, please contact the authors of this article or other members of the EY team with whom you work.

Author:

Jan Turek

Magdalena Hamáčková