Legal framework for electricity sharing within holding structures and contributory organizations.

What exactly does Lex OZE II change in electricity sharing?

It is crucial to understand that this does not involve building new physical cables between your operations. Electricity sharing is a "virtual" or accounting operation. The electricity you generate in one location is supplied to the distribution grid, and the EDC "allocates" it in real time (in 15-minute intervals) to your other consumption point, which is consuming it at that moment.

The legislation is effective and registration processes at the EDC are already underway. Now is the high time for a legal analysis of your existing structure and the selection of the optimal model. Find out what your legal options are – contact us at consultation@arws.cz.

Which sharing model to choose for a holding structure?

For most corporations, holdings, and companies with multiple branches, the "Active Customer" model is the most suitable solution. This model allows the creation of a sharing group that can have up to 11 members (any combination of generation and consumption points).

The key advantage for holdings is that sharing under the active customer regime is not geographically restricted and works across the entire Czech Republic.

Imagine that your manufacturing subsidiary in Ostrava has a photovoltaic power plant (PV) on its roof and generates surpluses at noon. At the same time, your administrative headquarters in Prague requires expensive electricity from the grid. Thanks to the "Active Customer" model, you can now virtually send this generated electricity from Ostrava to Prague, thereby reducing the group's overall costs for purchasing from external suppliers.

Our Prague-based legal team at ARROWS handles the setup of corporate and contractual relations on a daily basis. We will help you prepare sharing agreements between your companies so that they are legally and tax-bulletproof. For a consultation, write to us at consultation@arws.cz.

The limit of 11 points applies to a single sharing group. For more complex structures, establishing multiple groups can be considered, but as of August 1, 2026, the law does not limit the number of groups a single handover point can be assigned to, leaving it to the ERÚ implementing regulation; current rules must be verified. Such a step requires a detailed legal analysis. Contact us for a legal opinion at consultation@arws.cz.

The Greatest Risk: Free Sharing within a Corporate Group and VAT

Here we come to the greatest and often overlooked risk, which directly targets the financial and legal departments of corporations. Many companies logically assume that they will simply transfer or "donate" electricity within the group free of charge. However, this procedure can lead to high penalties.

A recent landmark ruling by the Czech Supreme Administrative Court (NSS) addressed exactly this situation. A company (a VAT payer) claimed a VAT deduction for the acquisition of a PV system, which is standard procedure. Subsequently, it provided the generated electricity to its tenants free of charge.

The tax administrator, and subsequently the court, applied the fiction of supply of goods under the VAT Act. In other words, the tax authority can assess output VAT on the entire volume of shared electricity, even if you provided it to a subsidiary "for free", including the associated penalties.

The solution is the correct contractual setup. The NSS indicated in its ruling that the company failed to prove that the price was "economically included" elsewhere. It is therefore crucial to prepare inter-company sharing agreements that define consideration – even if only in the form of setting a transfer price or as part of a broader package of services within the group.

We will prepare this key documentation for you at ARROWS to protect you from high fines and VAT assessments. We have extensive experience with the tax implications of corporate group transactions under Czech legislation. Write to us immediately at consultation@arws.cz.

Electricity Sharing in a Corporation

Energy Communities: A Solution for Municipalities and Their Contributory Organizations

While holdings benefit from the "Active Customer" model, a second model is designed for municipalities, regions, and their organizations: the "Energy Community" (EC).

Unlike the "Active Customer" model, it is necessary to establish a new legal entity here, typically an association or a cooperative. An energy community can have up to 1,000 members, but is geographically limited to a continuous territory of a maximum of 3 municipalities with extended powers (ORP) or the territory of the capital city of Prague.

The crucial news for founders (mayors, directors of authorities) is that the law explicitly allows membership for their contributory organizations.

As a municipality, you can thus build a PV system on the roof of a primary school and efficiently share the generated electricity with the municipal office building, a hospital, a library, or a retirement home. This maximizes the use of your own energy and significantly reduces expenditures from the municipal budget.

At ARROWS, we have more than 51 municipalities and regions in our portfolio, and we have long-standing experience with establishing associations, cooperatives, and preparing documentation for the public sector.

However, the new legislation also hides a risk. The law may limit voting rights (e.g., with a 10% cap per member). For a municipality financing the entire project, this is an unacceptable risk of losing control over the investment.

By strategically involving your contributory organizations (schools, hospitals, technical services) as additional members of the community, this risk can be legally managed to secure the necessary majority and control. However, this requires precise drafting of the articles of association.

Our Prague-based legal team is ready to prepare tailor-made articles of association for you that will protect your public investment and ensure you have the necessary influence over the management of the community. Write to us at consultation@arws.cz.

Establishing a Municipal Energy Community

How is it for international corporations?

A frequent question from international holdings is whether they can share electricity across borders, for example, from a PV system in Germany to a Czech operation. Here it must be clearly stated: cross-border electricity sharing outside the Czech Republic under the community energy regime is not permitted by current Czech legislation.

The real problem for international corporations is different: their foreign parent company does not understand Czech specifics, such as the EDC system, the role of the ERÚ, the setup of the allocation key, or the specific VAT risk.

Thanks to our ARROWS International network, built over ten years, we handle cases with an international element practically every day. We are accustomed to explaining Czech specifics to foreign management in English or German and setting up an optimal and secure legal framework for their Czech subsidiaries.

For an immediate solution for your international structure, write to us at consultation@arws.cz.

How to legally set up sharing correctly? The key is the allocation key

Whether you are a holding or a municipality, the technical heart of sharing is the so-called allocation key. This is not just a technical setting in the EDC system; it is primarily a method of fairly distributing the generated electricity (and thus the financial savings) among the individual members of the group.

The law allows various methods, from static (fixed percentages) to dynamic (in the future based on actual consumption). The choice of method and its setup has a direct impact on the finances of all involved.

The legal anchoring of the allocation key in contracts or articles of association is crucial to preventing future disputes within the group or community.

The Prague-based legal team at ARROWS will help you prepare internal guidelines and contracts, which define this allocation key clearly, fairly, and in a legally binding manner. Do not hesitate to contact our office – consultation@arws.cz.

Conclusion: The path from vision to savings leads through quality contracts

Lex OZE III (Act No. 87/2025 Coll.) opens the door to significant savings and energy efficiency. However, success depends not only on the installation of PV systems, but above all on the precise legal setup of the entire model. Poorly drafted contracts or articles of association can lead to tax assessments, loss of control, or future disputes.

Our experience in long-term care for more than 150 joint-stock companies and 250 LLCs allows us to deliver fast and high-quality legal solutions that protect your investments.

We are also accustomed to thinking from a business perspective. We are happy to listen to your business ideas and actively connect our clients if we see a mutual business opportunity.

Whether you are addressing cost optimization in a holding or preparing an energy community for your municipality, we are ready to provide you with comprehensive legal services. To secure documentation that protects you from fines and risks, contact us at consultation@arws.cz.