For more than two decades the family business enterprises of the first generation (generation of founders) are more and more dominating in the category of today’s small and medium–sized enterprises in the Czech Republic. The necessary legal background defining the legal relationships and rights of all participating persons was, however, limited to general provisions in the Commercial Code that has not solved many of the problems associated thereto. Only in 2012 the new Czech Civil Code, Act. No 89/2012 Coll., introduced the institute of family enterprise as completely new term in the Czech Civil law. The presented paper aims to analyse the key rules of this new legal regulation, focusing on significant aspects of the institute in the context of commercial law and family law, as well as, to highlight the potential weaknesses and gaps existing in the regulation.
In the context of the conclusion of contracts between entrepreneurs under the Czech Civil Code, it is a relatively common arrangement that the parties disclaim any and all liability for damage arising from non-compliance with contractual obligations, if they can prove that this failure was due to an obstacle independent of their will. This circumstance excluding liability for the damage is called force majeure by the theory. In many countries this circumstance is ruled upon directly by the legislation (höhere Gewalt, vis major). The Czech regulations represented by the new Civil Code of 2012 (CivC), however, contains only a framework provision that mentions discharging reasons. The paper deals with the -rather disputable -issue that the force majeure does not affect the obligation to pay a contractual penalty under the new rules of the CivC. It should be therefore reflected in the arrangements for contractual penalties inter partes. To this effect the paper analyses the concepts of contractual penalties and force majeure in civil law legislation. Afterwards it compares their mutual relationship and impact on the obligations of the Contracting Parties. Finally, it draws recommendations for practice from the perspective of the contracting process.
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