Supreme Court – Czech Legislation on Register of Beneficial Owners Conflicts with EU Law

As a part of this News bulletin, we would like to inform you about a recent decision of the Supreme Court of the Czech Republic that confirmed that the legislation on the register of beneficial owners (RBO) conflicts with EU law in that the RBO is accessible to the public. Therefore, until the Czech legislation is amended, the government may not force legal entities and trust funds (registering persons) to register their beneficial owners in the RBO.

Developments Regarding Accessibility of the RBO

Years ago, the Czech Act on the Register of Beneficial Owners implemented the EU’s AML Directive, according to which certain data on beneficial owners were initially to be available to the general public. However, the Court of Justice of the EU ruled in late 2022 that the Directive’s broad accessibility rule was invalid, because it infringed the EU Charter of Fundamental Rights by interfering with the right to protection of private and family life and the right to protection of personal data. European legislators then amended the EU AML Directive accordingly in 2024.

Conclusions of the Supreme Court

However, Czech legislators have not yet reacted to this amendment to the EU’s AML Directive. Therefore, at the end of August 2025 the Supreme Court of the Czech Republic, in a specific case (Supreme Court Resolution of 25 August 2025, file ref. 27 Cdo 1368/2024, available here), explicitly stated that the current Czech legislation allowing the general public to access the RBO is contrary to EU law. In the Supreme Court’s opinion, Czech legislators have created a stalemate for registering persons, where the performance of the statutory duty to notify the RBO automatically results in the making available of data to the general public. However, this state of affairs, caused entirely by inaction on the part of Czech legislators, cannot be to the detriment of registering persons and their beneficial owners.

Therefore, while the register of beneficial owners is easily accessible to any member of the general public, the government may not enforce compliance with the duty to enter data in the RBO and keep it up-to-date by means of fines and discrepancy proceedings.

Czech legislators will have to respond to this situation, change the law and restrict access to the RBO only to competent authorities, obliged persons pursuant to the AML Act and persons who demonstrate a legitimate interest.

Some Implications for Practice

Registering persons, in particular business companies, therefore do not now have to worry about the threat of financial penalties or discrepancy proceedings if they do not enter details of beneficial owners in the RBO.

However, this does not mean that companies can now forget all their duties pursuant to the Act on the Register of Beneficial Owners. The courts in no way questioned the duty to obtain and record up-to-date data on beneficial owners. Similarly, obliged persons pursuant to the AML Act, e.g. banks, have to request this information during a client check. For such obliged persons, this now means the need to investigate in more detail the situation of specific clients as to whether their beneficial owners’ details are up to date. Paradoxically, the Supreme Court’s conclusions may, in our opinion, lead to a situation where, in specific cases, registering persons are more burdened with the need to communicate and prove data on beneficial owners to obliged persons pursuant to the AML Act, in particular to banks.

Once Czech legislators amend the law in the required manner, it will be necessary to continue to fully comply not only with the duty to obtain data on beneficial owners, but also to report it to the RBO. In view of the upcoming elections to the Chamber of Deputies, it can be estimated that the amendment will take place in 2026 at the earliest.

As soon as the effective date of the amendment to the Czech Act on the Register of Beneficial Owners is known, we will naturally inform you of this, as well as any further developments concerning the issue.

With friendly regards,

Team WTS Alfery, Alfery Hrdina Advokáti