Acta Univ. Agric. Silvic. Mendelianae Brun. 2011, 59(7), 541-552 | DOI: 10.11118/actaun201159070541

Private equity and venture capital: investment fund structures in the Czech Republic

Marek Zinecker
Ústav financí, Fakulta podnikatelská, Vysoké učení technické v Brně, Kolejní 4, 612 00 Brno, Česká republika

A working private equity and venture capital market (PE/VC market) stimulates the business environment in a positive manner and impacts the level of economic growth of national economies. A study of the Austrian Private Equity and Venture Capital Organisation/AVCO (2004, p. 6) defines prerequisites for a correct operation of the PE/VC market. It views the legislative provision for suitable legal fund structures for PE/VC investments and their tax treatment as a key factor. In its publication, Private Equity & Venture Capital in the Czech Republic (2010, p. 14), the Czech Venture Capital Association/CVCA stresses that legal barriers are an important reason behind the limited scope of resources available to domestic PE/VC funds. Legal barriers prevent the establishment of a standard PE/VC fund in the territory of the Czech Republic, which fact in turn has a negative impact on the level of development of the domestic PE/VC market (fundraising, investment volumes, establishment of the infrastructure required for the operation of PE/VC funds). The purpose of this article is, based on an analysis of the relevant information sources, to assess how the current Czech legislation regulates the legal fund structures for PE/VC investments and their tax treatment. Proposals for a potential improvement of the situation are based on a comparison of the legislative framework applicable in the Czech Republic and the requirements defined by the European Venture Capital Association/EVCA, as well as the AVCO study (2004, 2006).

Keywords: private equity, venture capital, tax and legal environment, private equity and venture capital fund structures
Grants and funding:

This article was written as a part of a project called Rozvoj poznatků ke zdokonalování informační podpory ekonomického řízení podniku. This project is supported by Internal Grant Agency at Brno University of Technology and registered under No. FP-S-11-1. The project was undertaken under the auspices of Czech Private Equity and Venture Capital Association (CVCA).

Received: June 24, 2011; Published: January 26, 2014  Show citation

ACS AIP APA ASA Harvard Chicago IEEE ISO690 MLA NLM Turabian Vancouver
Zinecker, M. (2011). Private equity and venture capital: investment fund structures in the Czech Republic. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 59(7), 541-552. doi: 10.11118/actaun201159070541
Share...
Download citation
  • BibTeX (.bib)
  • Bookends (.ris)
  • EasyBib (.ris)
  • EndNote (.enw)
  • EndNote 8 (.xml)
  • ISI WoS (.isi)
  • Medlars (.medlars)
  • Mendeley (.ris)
  • MODS (.xml)
  • Papers (.ris)
  • RefWorks (.txt)
  • RefManager (.ris)
  • RIS (.ris)
  • MS Word (.xml)
  • Zotero (.ris)
    • Open full article

    References

    1. EVCA - Key Facts and Figures [online], 2011. Available at: http://www.evca.eu/publicandregulatoryaffairs/default.aspx?id=86 [cit. 2011-05-24].
    2. EVCA - AIFM Directive [online], 2011. Available at: http://www.evca.eu/publicandregulatoryaffairs/default.aspx?id=5574 [cit. 2011-04-20].
    3. European Commission - Alternative investments [online], 2011. Available at: http://ec.europa.eu/internal_market/investment/alternative_investments_en.htm [cit. 2011-04-12].
    4. BARTES, F., 1997: Konkurenční strategie firmy. 1st ed. Prague: Management Press. 124 pages. ISBN 80-85943-41-7.
    5. Benchmarking European and Legal Environments. Brussels: EVCA, 2008. 194 pages. Without ISBN.
    6. DVOŘÁK, I., PROCHÁZKA, P., 1998: Rizikový a rozvojový kapitál. 1st ed. Prague: Management Press. 169 pages. ISBN 80-85943-74-3.
    7. GLODEN, A., JUD, T., PENEDER, M., 2006: Endbericht: Empirische Untersuchungen und Ergebnisse zur Wirkung von Private Equity und Venture Capital auf die Unternehmensentwicklung. Wien: AVCO - Austrian Private Equity and Venture Capital Organisation. 124 pages. Without ISBN.
    8. PAŠTIKOVÁ, V., 2006: Jak zdanit transparentní entity [online]. Available at: http://ekonom.ihned.cz/c1-19631720-transparentni-entity [cit. 2011-02-14].
    9. PENEDER, M., SCHWARZ, G., JUD, T., 2004: Endbericht: Der Einfluss von Private Equity (PE) und Venture Capital (VC) auf Wachstum und Innovationsleistung österreichischer Unternehmen. Wien: AVCO - Austrian Private Equity and Venture Capital Organisation. 120 pages. Without ISBN.
    10. Private Equity Fund Structures in Europe. Brussels: EVCA, 2006. Without ISBN.
    11. Private Equity Fund Structures in Europe. Brussels: EVCA, 2010. Without ISBN.
    12. Přehled možných investičních struktur - pracovní materiál pouze pro diskusní účely. Prague: CVCA, 2010. Without ISBN.
    13. RUDOLPH, B., HAAGEN, F., 2004: Die Auswirkungen institutioneller Rahmenbedingungen auf die Venture Capital-Finanzierung in Deutschland [online]. Available at: http://www.bwl.uni-muenchen.de/forschung/diskus_beitraege/workingpaper/3539.pdf [cit. 2010-05-24].
    14. TOPINKA, J., 2007: Fondy kvalifikovaných investorů v České republice [online]. Available at: http://www.epravo.cz/top/clanky/fondy-kvalifikovanych-investoru-v-ceske-republice-48837.html [cit. 2010-05-24].
    15. VLČKOVÁ, J., SUCHÝ, P., ŠANDERA, M., 2010: Některé otázky spojené s fondy kvalifikovaných investorů [online]. Available at: http://bankovnictvi.ihned.cz/c1-40099900-nektere-otazky-spojene-s-fondy-kvalifikovanych-investoru [cit. 2011-02-14].
    16. Act No. 586/1992 Coll., on Income Tax.
    17. Act No. 235/2004 Coll., on VAT.
    18. Act No. 189/2004 Coll., on Collective Investment.
    19. Act No. 256/2004 Coll., on Business Activities on the Capital Market.

    This is an open access article distributed under the terms of the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License (CC BY NC ND 4.0), which permits non-comercial use, distribution, and reproduction in any medium, provided the original publication is properly cited. No use, distribution or reproduction is permitted which does not comply with these terms.


    Return to the content