Appointment of a Guardian of the Limited Liability Company

In case of a managing director's death, resignation or recall from office or upon another termination of his or her office, the general meeting is obliged to elect a new managing director within 1 month.

If no managing director is elected within the above mentioned period, a managing director can be appointed by a court (for a period of time until a new managing director is properly elected). The court is allowed to make such decision only on the basis of a petition of a person having a legal interest therein.

In case no petition was filed or the filed petition was denied, the court may (even ex officio) dissolve the company and order its liquidation.

According to the opinion of the Supreme Court of the Czech Republic (decision of April 20^th, 2016, Reference Number 29 Cdo 3899/2015) the above mentioned regulation set in Business Corporations Act does not exclude the possibility of the Court to appoint a guardian of the limited liability company in accordance with Section 165 Subsection 1 of the Civil Code (if the court finds out this decision more suitable regarding the concrete situation of the company).

As soon as a new managing director is appointed, the function of the guardian automatically ceases to exist (i.e. without the necessity of a court´s decision).