The draft implements the EU legislative package, which consists of Regulation (EU) 2024/2809 of the European Parliament and of the Council of October 23, 2024, Directive (EU) 2024/2810 of the European Parliament and of the Council (EU) 2024/2810 of October 23, 2024, and Directive (EU) 2024/2811 of the European Parliament and of the Council of October 23, 2024 (“Listing Act Package”). The draft law also includes the transposition of Directive (EU) 2024/2994 of the European Parliament and of the Council of November 27, 2024 (“EMIR 3”) and the partial transposition of Directive (EU) 2019/878 of the European Parliament and of the Council (EU) 2019/878 of May 20, 2019 (“CRD V”) and Directive (EU) 2024/1619 of the European Parliament and of the Council of May 31, 2024 (“CRD VI”).
The aim of the draft is also to align the Czech legal system with Regulation (EU) (EU) 2024/3005 of November 27, 2024 (the “ESG Rating Regulation”) and to address certain objections regarding the previous transposition of certain directives raised by the European Commission against the Czech Republic within the framework of the so-called “Conformity Pilot.” The amendment is expected to take effect gradually in the summer and by the end of 2026.
The draft fundamentally changes the rules governing the issuance of prospectuses and introduces a new offering document, thereby reducing the administrative burden on issuers. The obligation to prepare a prospectus is now conditional on the total aggregate value of the securities being at least EUR 5 million, while a new, simpler “offering document” is established for issuances between EUR 1 million and EUR 5 million.
The proposal also relaxes the rules governing companies’ entry into the capital market, particularly by lowering the requirements for the so-called “free float.” A lower percentage of shares held by the public (approximately 10 %) is now sufficient, and alternative conditions are introduced that the market operator may assess flexibly.
Another significant change is the revision of investment research conditions. The very concept of research is defined, rules for investment research are introduced, and, for the first time, rules for issuer-sponsored research are established, including rules for its labeling, financing, and conflicts of interest. This change is important for small and medium-sized enterprises, as this regulation is intended to help them more easily attract investor attention. Additionally, the market for small and medium-sized enterprises (“SME growth market”) may now be operated solely as part of a multilateral trading facility (“MTF”), rather than as a standalone entity, thereby expanding market organization options.
Another new feature concerns shares with different voting weights (“dual-class shares”). The proposal explicitly prohibits the refusal of their admission to trading and introduces extensive disclosure requirements regarding their structure, thereby enhancing their transparency compared to the previous regulation.
The draft also repeals certain administrative obligations, in particular the obligation to register additional business activities. There are also changes in the area of risk management for securities dealers, with a new explicit obligation to monitor and manage concentration risk with respect to central counterparties, including the obligation to establish plans and targets in this area.
Another change is the expansion of the conditions for authorizing activities, whereby it is now assessed whether an entity’s other business activities pose a risk to financial stability or supervision. In the area of supervision and market rules, the proposal also strengthens the powers of the Czech National Bank, allowing it, for example, to adjust the thresholds for reporting transactions by persons with managerial authority.
At the same time, there are a number of minor deregulations and technical changes, the removal of certain requirements (e.g., full legal capacity in certain provisions), the simplification of reporting obligations, and the adjustment of references in line with EU law.
The proposal represents a modernization amendment that, compared to the original legislation, reduces the regulatory burden (prospectus, administrative obligations), expands the rules for investment research, facilitates companies’ entry into the capital market, and at the same time strengthens transparency and risk management in key areas.
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