Czech Republic’s Remote Financial Services Agreement

Substance Permitted: Yes

In a remote financial services agreement under the Czech Civil Code, additional due diligence is required for non-face-to-face transactions and/or relationships. According to Article [insert article number], the entity shall review the customer as follows:

• The first payment under this agreement shall be made via an account kept in the customer’s name held at a credit institution or a foreign credit institution operating in the European Union (EU) or the European Economic Area (EEA).
• The customer shall submit to the entity a copy of a document verifying the existence of this account, along with the relevant part of their identity card and national ID card details.

Risk-Based Approach: Yes

The Czech Republic has a risk-based approach to combating money laundering and terrorist financing. According to Article [insert article number], financial institutions are required to use a risk-based approach when assessing the level of due diligence and monitoring necessary for each customer.

Acceptance of E-Signatures: Yes

Electronic signatures are presumed valid unless proof to the contrary is produced. Section 3 of the 227/2000 Coll. ACT states, “A data message shall be signed if it is furnished with an electronic signature.”

Transfer of Information

Transfers of personal data outside the EEA and EU have been affected by the decision of No. C-362/14 Maximillian Schrems v. Data Protection Commissioner from 06 Oct 2015 of the Court of Justice of the European Union, cancelling the Safe Harbor Regime. As a result:

• The Czech Office for Personal Data Protection recommends using standard contractual clauses according to the Commission decision No. 2010/87/EU from 05 Feb 2010 and/or Binding Corporate Rules to govern the transfer of information to the US.

Business Secrecy

The general business secrecy is stipulated in the Act No. 89/2012 Coll., the Civil Code, and specific bank secrecy is stipulated in the Act No. 21/1992 Coll., on banks. Bank secrecy means keeping confidential all the information and documents on matters relating to the client of the bank that is not publicly accessible.

Summary

The Czech Republic follows the UNCITRAL model law and is similar to the laws of many European Union member states. It gives digital signatures the same status as handwritten signatures, but also recognizes simple electronic signatures as legal and enforceable. The country has a risk-based approach to combating money laundering and terrorist financing, and accepts electronic signatures. Additionally, transfers of personal data outside the EEA and EU are governed by specific regulations, including standard contractual clauses and Binding Corporate Rules. Finally, business secrecy is stipulated in the Civil Code and specific bank secrecy is stipulated in the Act on banks.