Points of law

The Supreme Court stated in the decision that: when a foreign state does not act as a sovereign entity carrying out public authority (acta iure imperii), but on the contrary as a legal entity in matters arising from individual labour law-related issues, which are defined by equality of subjects, then the foreign state does not enjoy immunity and Czech courts can exercise their jurisdiction.

Summary of the case

The Supreme Court of the Czech Republic, in its decision of 25 June 2008, dealt with a case of wrongful termination of employment contract concluded between B. B. and Polish Embassy in the Czech Republic. Whereas lower courts ruled that jurisdiction of Czech courts did not exist since Poland enjoyed immunity, the Supreme Court pointed out the need to distinguish whether foreign state acted as a sovereign entity carrying out sovereign authority (acta iure imperii) or as a subject of private law where it is not carrying out any sovereign authority and thus is equal with other subjects. Based on Plaintiff’s (B. B.) extraordinary appeal against decisions of lower courts, the Supreme Court repealed these decisions and obliged lower courts to hear the case again bearing in mind that in such cases there is no reason for granting foreign states immunity in accordance with the principles enunciated above.

Sources

The Supreme Court of the Czech Republic Judgement Ref. No. 21 Cdo 2215/2007 (available here: http://nsoud.cz/)

Additional information (explanations, notes, etc.)

Although this case was dealt with at the time when old legislation (Act No. 97/1963 Sb.) was in effect, the conclusion of the Supreme Court is still valid even after new legislation (Act No. 91/2012 Sb.) came into effect.