Exporting guide to Czech Republic

Overview

The Czech Republic has a well developed and export-oriented economy. Its location in the centre of Europe gives UK exporters easy access to Germany and other Central and Eastern European (CEE) markets.

A sound economy

The Czech economy has expanded consistently in recent years, with steady GDP growth. Plus, with low inflation and relatively low unemployment, the Czech population should enjoy increased spending power, which could benefit UK exporters.

Purchasing power

Purchasing power is high compared to other CEE countries. Local customers are leading the region with respect to internet and smartphone penetration, online shopping and card payments.

Part of global supply chains

In the B2B segment, the country is part of global supply chains. A number of major original equipment manufacturers (OEMs) are located here such as SKODA AUTO, Hyundai and TPCA (automotive), Skoda Transportation (rail) and Foxconn (electronics).

Street scene in Czech Republic

Czech Republic: at a glance

Economic growth

-5.8%

Actual figure (IMF, 2020)
The UK is -9.3% (IMF, 2020, actual figure)

GDP per capita

$22,942

Actual figure (IMF, 2020)
The UK is $41,127 (IMF, 2020, projected figure)

Currency

Czech koruna

Business languages

Czech, English

You may need a translator

Time zone

GMT + 1

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Opportunities for exporters

The Czech Republic is a popular CEE country for UK exports as well as for investment. A large pool of expats, especially in Prague, together with affluent customers pay attention to sustainable fashion, food and beauty. This represents a great customer base for UK consumer goods. In B2B, automotive currently accounts for a high GDP share but considering future growth, other segments such as clean growth, energy and digitization seem very promising.

Check for trade barriers

Trade barriers, such as tariffs or taxes, can raise costs, cause delays, or even stop you from exporting. Check for any issues that may impact your business when exporting.

See current trade barriers

See resolved trade barriers

Check duties and customs

Find information on how to export goods from the UK. View the duties, rules, restrictions, and the documents you need for your products.

See current duties and customs procedures

Doing business in the Czech Republic

Preparing to export

VAT

VAT is generally charged at 21% on supplies of goods and services. Certain supplies are taxed at a rate of 15%.

Companies based in the Czech Republic whose turnover exceeds CZK 1 million in any consecutive 12-month period must register as a VAT payer with the tax authorities.

For non-resident companies, there is no registration threshold, but you must register as a VAT payer if one of the following applies:

  • you make any supply subject to Czech VAT (unless the liability to declare and pay VAT is shifted to the recipient of the supply
  • you supply goods from the Czech Republic to another EU member state

Import duties

Duties depend on tariff classification of goods (product’s commodity code).

TARIC – EK provides information about tariff duties and conditions for imports/exports.

TARIC – CZ is adjusted to the Czech environment and contains information about tariff duties and conditions for imports/exports as well as VAT and SPD

Regulations

As an EU member state, the Czech Republic is part of the Single Market.
It is a stable and conducive legal-business climate.

The main regulatory challenges include:

  • a complex bureaucracy
  • slow judicial system
  • ongoing changes in tax regulations

Public procurement is usually done in Czech.

Operating in the Czech Republic

Intellectual property

The Czech Republic is a signatory on most international treaties concerning the protection of intellectual property and is a member of the World Intellectual Property Organization (WIPO/OMPI).

The Industrial Property Office is the central national authority in the Czech Republic for the protection of industrial property rights and serves primarily as the patent and trademarks office.

The UK's Intellectual Property Office provides practical information to help you protect, manage and enforce your IP abroad.

Payment terms

Czech firms use prepayment or partial prepayment, with the balance due upon delivery or net 30-day terms.

Czechs are frontrunners for contactless payments and have the highest percentage of credit transfers in total non-cash payments in Europe.

The main credit cards used in the Czech Republic are MasterCard and Visa. These are issued by all major local banks. The most common type is debit cards (about 70% of all cards) followed by credit cards (about 28%).

The Czech National Bank has information on regulations applicable to payments.

Next steps

DIT can advise you on doing business abroad, and help put you in touch with other people who can help such as lawyers and distributors.