LEASE OF WORKS

   (IS POSSIBLE IN THE CASE OF ALLOWANCE ORGANIZATION ESTABLISHED BY SELF-GOVERNING TERRITORIAL
   UNITS?)

   

   PETR POSPÍŠIL

                              Právnická fakulta Masarykovy univerzity,

   Katedra správní vědy, správního práva a finančního práva

   

   PETR HAVLAN

   

   

   Key words

   self-governing territorial units, municipality, region, allowance organization, public
   non-profit institutional health service, health service, hospital, works, undertaker, business
   activities, contract on the lease of works, main activities, additional activities

   

   The Czech state decided to transfer some of his health services to self-governing regions
   under the rule of law no. 290/2000 Coll. The legal form of the transfered health services, as
   provided by law, was allowance organization. The key question of present for the
   self-governing regions and the municipalities is whether the allowance organization is the
   best legal form to provide public services assigned to them by law. There are discussed
   alternatives of another legal forms applicable for health services as business company and
   also is discussed the possibility of lease or sale of works.

   

   A new legal  form of  “public non-profit institutional health service“ established by the law
   no. 245/2006 Coll. has not been available for real conditions of health services. Even
   Constitutional Court canceled some parts of the law as unconstitutional. That is why there
   does not exist any health service in a legal form of “public non-profit institutional health
   service“ in Czech republic.

   

   The proposed contribution deals with a lease of works with the purpose to briefly outline some
   problems of legal regulation in force related to the basic question of possibility and
   legality of lease of a health service in a legal form of an allowance organization of
   self-governing territorial units. The main starting points of presented ideas are the current
   legal regulation of Czech administrative law defining the relation of regions and
   municipalities to their allowance organizations and also the current legal regulation of 
   Czech business law defining the legal concept of  works, undertaker, business activities and
   legal essentials of the contract on the lease of works.

   

   Allowance organizations are legal entities established by the municipalities or the
   self-governing regions to perform some of their duties. The  self-governing territorial units
   and allowance organizations relations law regulation is included in law no. 128/2000 Coll.,
   law no 129/2000 Coll. and  law no. 250/2000 Coll.  The allowance organizations established by
   the self-governing regions (municipalities) are usually founded as non-profit organisations to
   provide services of public interest in various fields including public health. Law no. 20/1966
   Coll. defines that regions (municipalities) can establish and control legal entities providing
   health services.

   

   The current legal regulation of allowance organizations does not presume the possibility of
   lease of works; on the other side it is not illegitimate. In my opinion self-governing
   territorial units as an integral part of  public administration are strictly limited in
   relations to allowance organizations and cannot do anything what is not provided by law.

   

   One of the key questions for that one who would like to make a lease of works is whether an
   allowance organization is (has) a works. The contract of lease of works is defined by law no
   513/1991 Coll. There is also defined a principal legal concept of works in the Czech
   Commercial Code. Works is a set of material, personal and immaterial assets of business
   activities. At he same time bussines activities as a hallmark of works are defined as a
   systematic and independent  activities performed by an undertaker with a purpose of profit.

   

   Hospitals and another health services established in a legal form of allowance organization of
   self-governing territorial units do not meet constituent elements of business activities.
   Substance of main activities of allowance organizations rests in provision of non-profit
   public health services to citizens of municipality or region. Profit is not the purpose of
   activities of allowance organizations providing health services. That is why there is no works
   in the case of allowance organization providing health services established by self-governing
   territorial units. Strictly said there is no subject of the contract of lease of works in the
   case of such allowance organization.

   

   Business activities can be provided as collateral economic activities of an allowance
   organization. These collateral economic activities are usually performed on the basis of trade
   (or similar) licence. While providing these collateral economic activities, allowance
   organization is in position of an undertaker. In my opinion it is possible to make a contract
   of lease of works only in the case of collateral economic activities of allowance organization
   established by self-governing territorial units.

   

   On the basis of  exercised anylysis  I come to the conclusion that it is not legal (by Czech
   law) to make a contract of lease of works in the case of allowance organization providing
   health services established by self-governing territorial units (with reservations as to
   collateral economic activities of allowance organization).

   

   I am aware of different legal opinion in presented matters. Some municipalities have even made
   a contract of lease of works relating to an allowance organization (hospital) as a whole
   (including health services).

   

   Contact – email:

   petr.pospisil@kr-t.cz

   petposp@seznam.cz

   18728@mail.muni.cz