“When writing their final written test, students can also use a calculator and a calendar.” This is one of the rules a law student reads when preparing for the final written exam. A passer-by might ask why a student brings a calendar to an exam in addition to the laws. Counting time (deadlines) is no easy feat – and the consequences of a wrong calculation can be very unpleasant. Legal systems even have a counter in the practical tools section to make lawyers’ lives easier. However, it may be complicated by conflicting court decisions. A judgment of the Supreme Administrative Court of the Czech Republic (“SAC”) from this May [1] unifies and clarifies the existing interpretation.

As a basic rule for counting the time is that if the last day of the period falls on a Saturday, Sunday or public holiday, the end of the period is moved to the next working day.

The SAC dealt with the case of a dispute between the business corporation HUL HO, s.r.o. (“the Company”) and the Appellate Financial Directorate (“AFD”), which2016 issued a payment order on 22 December imposing a fine of CZK 30,000 on the Company for “failure to (timely) submit a follow-up audit report based on a request to amend, supplement or confirm the data provided in the submitted audit report for the tax period of April 2016”.

For the tax period of April 2016, the Company submitted a control report on 29 May 2016 already, but on 2 June 2016 the tax administrator, i.e. the Financial Office, invited the Company to amend, supplement or confirm the information contained therein (Section A. 4.), within 5 days from the date of notification of this summons (the “summons”), which was delivered to the Company by fiction under Act No. 300/2008 Coll., on Electronic Acts and Authorised Conversion of Documents, as amended (hereinafter also referred to as the “Act on Electronic Acts”). The fiction of service occurred under the provisions of article 17(4) of the Act, which reads as follows: “If the person referred to in paragraph 3 fails to log in to the data box within 10 days of the date, on which the document was delivered to the data box, the document shall be deemed to have been delivered on the last day of that period; this shall not apply, if another legal provision excludes substitute delivery.”

The date of issue of the summons was Thursday 2 June, delivery by fiction occurred on Sunday 12 June according to the interpretation of the Financial Office and the last day for filing was Friday 17 June, but the Company did not file the control report until after the weekend, on Monday 20 June. The Financial Office accepted the submission but deemed it to be late and issued the aforementioned payment order and proceeded to impose a fine. The Company appealed against such a procedure, referring to article 33(4) of Act No.280/2009 Coll., the Code of Tax Procedure, as amended (“CoTP”), which, in accordance with the above-mentioned established practice, provides that “If the last day of the period falls on a Saturday, Sunday or public holiday, the last day of the period shall be the nearest following working day; this shall not apply, if the period is determined in shorter time units than days.” On this interpretation, delivery could not have fallen on Sunday 12 June but only on the following working day (13 June), with the result that the deadline for compliance did not end until Saturday 18 June and the end of the deadline therefore fell on Monday 20 June, when the Company sent the control report. The Appellate Financial Directorate upheld the decision of the Financial Office and the Company proceeded to file an administrative action.

It may seem that the action of the state authorities is incomprehensible – the law is clear and the Company is in the right. However, there is a nine-year-old decision nicknamed “STASEK” penned by the Supreme Administrative Court[2]. The decision stipulated that the rule on service on weekends and public holidays shall not apply to electronic service. The Regional Court departed from such an interpretation and said that the postponement of the deadline from weekends and holidays to working days was not introduced because the post offices are closed and the addressee cannot pick up the letter (this was the basis of the “STASEK”, because there is of course no such obstacle with data boxes). This is the legislator’s value judgement against weekend work. Regardless of the means, by which the message is delivered, one should not have to deal with it during a rest period, the Regional Court held.

“The time counting rule is therefore not about whether or not the person concerned has access to the delivery/service point. In fact, the point here is that – even though the person has such access – the person should be able to rest, i.e. the person should not be forced to log into the data box on Saturdays, Sundays and public holidays and can postpone this activity until the next working day without consequence.”

The Regional Court also convincingly explained that, in compliance with the principle that the legal order is not contradictory, it is nonsensical that the provisions of the CoTP should not be preferred when the Electronic Transactions Act does not contain any rule for the calculation of time.

The AFD lodged a cassation complaint with the SAC. The Enlarged Chamber of the SAC sided with the argumentation of the Regional Court and thus found in favour of the Company, thereby also overcoming the existing case law defined by the aforementioned “STASEK” decision.

“Where a document is served in the course of tax administration, article 33(4) of the Tax Code is applicable to the area of delivery to a data box, according to which, if the last day of the deadline falls on a Saturday, Sunday or public holiday, the last day of the deadline shall be the nearest following working day; this does not apply if the deadline is set in shorter time units than days.”

It should therefore be definitively unified that the calculation of deadlines according to the CoTP also applies to electronic communication between the state and the citizens.

If you have any questions on this topic, please do not hesitate to contact us.

[1] SAC Judgment No. 4 Afs 264/2018-85 of 26 May 2022

[2] Judgment of the SAC No. 5 Afs 76/2012-28 of 16 May 2013

Author: Veronika Odrobinová, Adam Simota