Entrepreneurship of Natural Persons

In this chapter you will learn about the definition of an entrepreneur (a natural person) and the license that authorises you to do business in the CR.

In the Czech Republic, an entrepreneur is defined as a person who, on their own account and responsibility, independently carries out a gainful activity in the form of a trade or in a similar manner with the intention of doing so continuously for the purpose of making a profit.

An individual who performs a business activity is called a self-employed person (in Czech OSVČ). Self-employment can take the form of a main activity or secondary activity. Self-employment as a secondary activity means that you do business while employed, on a parental leave, or while receiving old-age pension.

For detailed information about self-employment and the criteria for defining it as a main or secondary activity, see the website of the Czech Social Security Administration.

The most common way of doing business in the CR is what is called trade business, which is regulated by the Trade Licensing Act. The current version of the law can be found on the website of the Ministry of Industry and Trade which is responsible for the area of business.

At the same time, it is possible to do business within what is called a liberal profession. A liberal profession is defined as entrepreneurship of a natural person carried out on the basis of a law other than the Trade Licensing Act. For some liberal professions it is compulsory to become members of a professional chamber (e.g., lawyers and doctors), while for others it is only voluntary (e.g., journalists).

The different types of entrepreneurships of natural persons will be explained in the following chapters.

Updated for socio-legal content as of 8th November 2021.