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Glossary of terms

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Board of Directors of OJSC

Managing authority of executive and administrative nature (therefore sometimes referred to as "the Board").

The authority that decides on all matters except for matters reserved for the General Meeting or Supervisory Board.

The Board of Directors consists of:

  • Business management - management of the company in economic, industrial and organizational terms
  • Secretary/agent - makes legal acts on behalf of OJSC externally (articles, General Meeting or Supervisory Board may restrict it, limit, however, is not effective outside), each member of the Board of Directors acts separately on behalf of the company, unless the statutes provide otherwise.

Board of Directors manages the company between sessions of the General Meeting, it is a collective body (at least 3 members, from their elected chairman; does not apply to one-member JSC) and elected (by General Meeting or Supervisory Board, for the maximum term of 5 years - assessed for each member of the Board of Directors separately, repeatability possible) , its members may be appealed ny the body that elected them, they can withdraw (§ 66/1 col. law).

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Business (entrepreneurial activities)

Systematic activities carried out by an entrepreneur independently, in his own name and on his own responsibility for profit.

The entrepreneur himself makes business decisions, is not subject to command of anyone else, is in no relationship of subordination, is not personally subordinate to his trading partners (in many business professions certain dependence on the instructions of the customer is evident); independence, however, does not remove the obligation to follow the law and the liabilities assumed; the results of his activities are carried out by contract, i.e. by selling products, providing services, etc. The business should be distinguished from the work under an employment relationship where the employee performs work within the employer's organization, according to his disposition, usually in his premises and through his production and labour resources

for example, may be a seasonal activity, activity with certain breaks or special occasions - but it must not be unique activity, performed only rarely and randomly - a prerequisite for consistency is repetition of individual actions.

Carry out in his own  name 
excludes such action by companions on behalf of shareholders or employees activities on behalf of the employer, includes activity based on the contract of mandate (commercial lawyers, lawyers)

On his own  responsibility
anyone else in not responsible for the entrepreneur, he is responsible for his liabilities, if he commits a breach of a legal obligation, he bears responsibility associated with such a violation; that is not the case, if an employee commits a breach of a legal obligation when performing tasks of his employer - responsibility to a third party arises the employer and the employee is responsible to that employer, the infringement is therefore attributed to his employer - entrepreneur

For profit
an entrepreneur tries to get material benefit, profit is the motive of business; fact that this effort has not been satisfied yet does not change the fact that this is a business, the same applies to loss of earnings; law admits, in some cases, an entrepreneur and companies, which became not established for business purposes, in practice, it raises the question whether this benefit must have a pecuniary nature

A business is defined so that it is an activity performed by an entrepreneur - it must be an activity performed by a person under the list referred to in § 2, second paragraph, this list, however, is to some extent dependent on whether these people actually do business, and from that point of view, the provisions of § 2 of the Commercial Code is a circular definition: An entrepreneur is one who undertakes, but business is activity done by entrepreneur."

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Business share

Business share is participation of a partner in a company and the resulting rights and duties.

Share in the business always has two sides:

  1. Quantitative page -partner's share, can be defined in general
  2. Qualitative - rights and duties associated with the share, different for each company
  • Property rights
  • right to share in profits
  • the right to settle the shareholder and the company
  • Non-material rights
  • right to participate in the control and management of the company
  • right to information on matters of the company
  • Equity obligations
  • deposit obligation
  • obligation to compensate for loss of the company
  • Non equity obligations
  • to refrain from competitive behaviour
  • other obligations - are usually based by social contract and under the specific circumstances of that company"
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