Supporting materials for the application of the entrepreneur

The law distinguishes between two types of application in the case of an application by an entrepreneur for the issue of an Facility Security Clearance. The first is an application under Section 96(1) of the Act, referred to in the text as a ‘basic’ application. The second type of application is the entrepreneur’s application pursuant to Section 96(3) and (4) of the Act, which takes into account the fact that the entrepreneur already holds a valid Facility Security Clearance.

Requirements for a ‘basic’ application for the issue of an Facility Security Clearance under the Act

1. Entrepreneur's request form (model application set out in the Industrial Safety Ordinance – here, the application can be completed – here) contains

• identification data of the entrepreneur,
• the level of classification and the form of access to the classified information for which the clearance is requested;
• justification of the need for access to classified information by the entrepreneur, which contains data on the subject of business, within which the entrepreneur requests access to classified information, and the circumstances that justify the required form of access pursuant to Section 20 of the Act, as well as data on 
  • a public contract in which access to classified information is requested, its contracting authority and the expected duration of the procurement procedure;
  • a concession contract in which access to classified information is requested, its contracting authority and the expected duration of the concession award procedure;
  • a public contract or a concession contract prior to the launch of the procurement or concession procedure for which the entrepreneur intends to apply and under which access to classified information is presumed, its contracting authority or contracting entity and the expected date for the launch of the procurement or concession procedure;
  • a public contract or a concession contract under which access to classified information was requested, to its contracting authority or to the contracting authority, provided that the procurement or concession procedure was initiated no more than five years before the date of submission of the entrepreneur’s application for the issue of the Facility Security Clearance and the subject of its performance corresponds to the entrepreneur’s business object;
  • the contract or, as the case may be, other legal facts on the basis of which access to classified information is requested, the subject-matter of that contract and the provider of the classified information,
• the facts on the basis of which the entrepreneur will create classified information,
• a statement that the information given in the application and its annexes is true and complete;
• the date of completion,
• signature of the responsible person of the entrepreneur,

2. a declaration by the entrepreneur on the waiver of the obligation of confidentiality of the materially and locally competent tax administrator and other persons involved in the tax administration pursuant to Section 52(2) of the Tax Code, to the full extent of the data for the purpose of conducting security proceedings (here)

3. completed questionnaire of the entrepreneur in electronic form (file in .xml format only) (here)

Data pursuant to Section 97(b) of the Act

If you have a graphic representation of the ownership structure of the entrepreneur, you can submit it to the Office. The Office welcomes such supporting documents and helps to assess the submitted data more quickly and accurately.

For an example of data pursuant to Section 97(i) and (j) of the Act, we state:

When filling in the data in point (i) of the entrepreneur's questionnaire ( Section 97(i) of the Act) – foreign business partners, with the exception of business partners from the Member States of the European Union, with a total financial volume of transactions exceeding CZK 2 000 000 in the last five years, Entrepreneur request according to in Section 96(1) of the Act ascertains whether in the last 5 years he has concluded trades with a foreign partner, whose total yearly the volume exceeded CZK 2 million in at least one of the five monitored years. If yes, the data to be filled in is the entrepreneur's questionnaire; under the heading ‘volume of transactions’, indicate the amount of all transactions with that partner over the entire period of 5 years.

Examples:

Data pursuant to Section 97(i) of the Act

1. 2020 – 500 000, 2021 – 2 million, 2022 – 200 000, 2023 – 300 000, 2024 – 1 million = does not report, because in none of the last five years has the total annual volume exceeded CZK 2 million;
2. 2020 – 600,000, 2021 – 2,1 million, 2022 – 300,000, 2023 – 1.7 million, 2024 – 500,000 = report, because in 2021 the total annual volume exceeded CZK 2 million and in the item volume of trades will indicate the amount CZK 5,2 million, that is, the sum of all trades in 5 years  

Data pursuant to Section 97(j) of the Act

When filling in the data in point (j) of the entrepreneur's questionnaire (Section 97(j) of the Act), Czech business partners and business partners from the Member States of the European Union to the extent specified by the implementing legislation, the entrepreneur proceeds in accordance with the provisions of Section 6 of the Industrial Safety Decree, which sets out the scope of the data provided.

4. documents necessary to verify the conditions pursuant to Section 16 of the Act: 

An entrepreneur, who is a natural person, attaches to the application of the entrepreneur:

• silent partnership agreement in the original, an officially certified copy or a simple copy, 
• contracts for the lease of premises, buildings and land referred to in Section 97(e) of the Act in the original, an officially certified copy or a simple copy, 
• proof of the issuance of bonds, stating the reason for the issuance and the total amount of issued bonds in the original in the original, an officially certified copy or a simple copy,
• regular financial statements, if he keeps accounts and is not a person registered in the Commercial Register, or tax returns, if he keeps tax records or applies expenses as a percentage of income under the Income Tax Act, for the last 5 years in the original, an officially certified copy or a simple copy,
• the auditor's reports on the statutory audit of financial statements submitted in accordance with the previous indent, if the auditor is not a person registered in the Commercial Register in the original, an officially certified copy or a simple copy,
• a summary of business liabilities that are past due by more than 180 days, specifying the individual creditors and the reason for non-payment dated and signed by the responsible person not more than 60 days from the date of issue in the original or an officially certified copy,
• statement of the owner's account in a separate register of investment instruments dated and signed by the responsible person not more than 60 days from the date of issue in the original or an officially certified copy,
• an overview of all shareholdings in joint-stock companies and shareholdings in percentages dated and signed by the responsible person not more than 60 days after the date of issue in the original or an officially certified copy,
• an overview of other investment securities, statement  of the shares and deposits in the registered capital of a public company, provided that they are not in the central register¹⁾, a limited partnership and limited liability companies and membership deposits in cooperatives dated and signed by the responsible person not more than 60 days from the date of issue in the original or an officially certified copy, 
• am overview of deposits into the registered capital of a foreign company dated and signed by the responsible person not more than 60 days after the date of issue in the original or an officially certified copy. 

Entrepreneurs, who are not a natural person, attached to the application of the entrepreneur: 

• evidence of decisions of its authorities on facts that are entered in the Commercial Register and are not yet entered in it in the original, an officially certified copy or a simple copy,
• silent partnership agreement with an entrepreneur in the original, an officially certified copy or a simple copy,
• contracts for the lease of premises, buildings and land referred to in Section 97(e) of the Act in the original, an officially certified copy or a simple copy,
• proof of the issuance of bonds, stating the reason for the issuance and the total amount of issued bonds in the original, an officially certified copy or a simple copy,
• a profit and loss statement for the last 5 completed financial years, if in at least one of these years they were or are a small accounting unit or micro accounting unit, which is not obliged to have the financial statements audited by an auditor, and if the obligation to publish this statement does not provide for the Accounting Act or if this statement was not published in the collection of documents under the Act governing public registers in the original, an officially certified copy or a simple copy,
• a summary of business liabilities that are past due by more than 180 days, specifying the individual creditors and the reason for non-payment dated and signed by the responsible person not more than 60 days from the date of issue in the original or an officially certified copy,
• statement of the owner's account in a separate register of investment instruments dated and signed by the responsible person not more than 60 days from the date of issue in the original or an officially certified copy,
• an overview of all shareholdings in joint-stock companies and shareholdings in percentages dated and signed by the responsible person not more than 60 days after the date of issue in the original or an officially certified copy
• an overview of other investment securities, provided that they are not in the central register, shares and deposits in the registered capital of a public company, a limited partnership and limited liability companies and membership deposits in cooperatives overview of other investment securities dated and signed by the responsible person not more than 60 days after the date of issue in the original or an officially certified copy
• an overview of deposits into the registered capital of a foreign company dated and signed by the responsible person not more than 60 days from the date of issue in the original or an officially certified copy.

5. security documentation of the entrepreneur, which contains a system for protecting classified information with the entrepreneur, one copy must be deposited with the entrepreneur, who is obliged to keep it up-to-date; the safety documentation shall include: 

• the specification of classified information to which the entrepreneur has access, including a list of such classified information with an indication of its originator or provider, the classification level and the specification of the contract, including classified information of a foreign power to which the entrepreneur has access, or confirmation pursuant to Section 97(h) of the Act,
• analysis of potential threats to classified information, appropriate and effective protective measures to reduce risks;
• a description of the methods of implementation of the different types of ensuring the protection of classified information. 

More information on the content of the entrepreneur's security documentation can be found here.

Please note:

An entrepreneur cannot apply for a so-called combination of grades within a single application, i.e. ask for a different classification level for the so-called ‘introduction’ of classified information (see Section 20(1)(b) of the Act) and another classification level for the so-called “provision, generation and storage” of classified information (see Section 20(1)(a) of the Act)!

One of the conditions for the initiation of security proceedings on the entrepreneur's application for the issue of the Facility Security Clearance is payment of the administrative fee pursuant to Act No 634/2004 on administrative fees, as amended, when submitting an application for the issue of a Facility Security Clearance. 

Part of the security documentation of the entrepreneur - "description of the methods of implementation of the different types of ensuring the protection of classified information" - it is necessary to structure according to these species specified in Section 5 of the Act: 

• personnel security (Title II of the Act),
• administrative security (Title IV of the Act),
• physical safety (Title V of the Act),
• security of information systems or communication systems (Title VI of the Act),
• cryptographic protection (Title VIII of the Act).

When processing the security documentation of the entrepreneur in the area of the use of means of ensuring the protection of classified information, it is always necessary to rely on the implementing legislation to the law (ordinances). If an entrepreneur intends to handle classified information in an information and communication system or to use cryptographic means of protection, he must apply in the form of a separate application to National Cyber and Information Security Authority on the certification of an information and communication system or the certification of a cryptographic product (the procedure is recommended to consult the said authority in advance).

If the entrepreneur asks for a form of access to classified information in the application for the issuance of the Facility Security Clearance, which consists only in the so-called ‘introduction’ of classified information, the entrepreneur’s security documentation shall contain in part - "description of the methods of implementation of the different types of ensuring the protection of classified information" - only a description of the implementation of personnel security measures.

What the entrepreneur must ensure in the context of security proceedings in relation to persons (employees) with the entrepreneur who are supposed to have access to classified information

The responsible person of an entrepreneur who has submitted an application for the issue of an Facility Security Clearance must ensure that natural persons with an entrepreneur who are presumed to have access to classified information on the basis of a valid Facility Security Clearance of the relevant classification level submit an application for the issue of such a clearance to the Office. Detailed information on this procedure can be found in the section Personnel security.

Requirements for the application for the issue of a Facility Security Clearance pursuant to Section 96(3) and (4) of the Act

If an entrepreneur who is to have access to classified information after the expiry of an existing Facility Security Clearance applies for a new Facility Security Clearance before the expiry of the current Facility Security Clearance within a period of at least:

• 7 months in the case of a new application for the issue of an Facility Security Clearance for the classification level Confidential, 
• 9 months in the case of a new application for the issue of an Facility Security Clearance for the classification level Secret, 
• 11 months in the case of a new application for the issue of an Facility Security Clearance for the classification level Top Secret,

The entrepreneur submits the following materials:

1. Entrepreneur's request form (model application set out in the Industrial Safety Ordinance – here, the application can be completed – here) contains 

• identification data of the entrepreneur,
• the level of classification and the form of access to the classified information for which the clearance is requested;
• justification of the need for access to classified information by the entrepreneur, which contains data on the subject of business, within which the entrepreneur requests access to classified information, and the circumstances that justify the required form of access pursuant to Section 20 of the Act, as well as data on
  • a public contract in which access to classified information is requested, its contracting authority and the expected duration of the procurement procedure;
  • a concession contract in which access to classified information is requested, its contracting authority and the expected duration of the concession award procedure;
  • a public contract or a concession contract prior to the launch of the procurement or concession procedure for which the entrepreneur intends to apply and under which access to classified information is presumed, its contracting authority or contracting entity and the expected date for the launch of the procurement or concession procedure;
  • a public contract or a concession contract under which access to classified information was requested, to its contracting authority or to the contracting authority, provided that the procurement or concession procedure was initiated no more than five years before the date of submission of the entrepreneur’s application for the issue of the Facility Security Clearance and the subject of its performance corresponds to the entrepreneur’s business object;
  • the contract or, as the case may be, other legal facts on the basis of which access to classified information is requested, the subject-matter of that contract and the provider of the classified information,
  • the facts on the basis of which the entrepreneur will create classified information,
• a statement that the information given in the application and its annexes is true and complete;
• the date of completion,
• signature of the responsible person of the entrepreneur,

2. A declaration by the entrepreneur on the waiver of the obligation of confidentiality of the materially and locally competent tax administrator and other persons involved in the tax administration pursuant to Section 52(2) of the Tax Code, to the full extent of the data for the purpose of conducting security proceedings (here)

3. completed questionnaire of the entrepreneur in electronic form (file in .xml format only) (here) with the fact that in the questionnaire of the entrepreneur are filled in only basic identification data, to the extent of the name or business name and identification number of the person and data, which have changed during the period of validity of the Facility Security Clearance and have not been notified pursuant to Section 7(2) and (3) of the Industrial Safety Decree, 

4. documents necessary to verify the conditions pursuant to Section 16 of the Act, if the Industrial Safety Decree so provides – see above – point 4 of Chapter The essentials of the basic application for the issue of a Facility Security Clearance according to the law, 

5. Security Documentation of the Entrepreneur to the extent of changes not notified to the Office pursuant to Sections 9 and 10 of the Industrial Safety Decree.

For example:

When submitting the basic application for the issue of the Facility Security Clearance under the Act, the entrepreneur provided in the entrepreneur's questionnaire, among other things, data on the entrepreneur's manager - item (a) - and valid account details - item (d).

He did not mention any foreign business partners - item (i), because he has not concluded any contracts, the total financial volume of the transaction would amount to more than 2.000.000 CZK, and has not provided any data in item (h) – contracts the subject matter of which contains classified information. 

After issuing the Facility Security Clearance, there have been changes consisting in the appointment of a second director, the accession of a silent partnership, the opening of new accounts; with a bank in the Czech Republic and one account with a bank abroad, the conclusion of a contract with a trading partner from the USA with a total trade volume of CZK 2 500 000 and with a trading partner from Egypt with a total trade volume of CZK 1 500 000. The entrepreneur has also established two new secure areas and, on the basis of the contractual relationship, classified information that is stored with the entrepreneur has been received. An insolvency petition was filed against the entrepreneur, but was rejected on the basis of a decision of the insolvency court.

In this case, the entrepreneur is obliged, pursuant to Sections 7 to 10 of the Industrial Safety Decree, to notify only changes to:

• immediately under headings (a) and (c) in the form of filling in these data in the entrepreneur's questionnaire and documenting the decision of the entrepreneur's body to appoint a second executive (e.g. the decision of the general meeting) and the silent partnership agreement with the entrepreneur,
• under the heading (d) by filling in the details of an account opened with a bank in a foreign country, within the framework of the annual notification of changes, which it is obliged to make on the date that coincides with the date of issue of the Facility Security Clearance,
• in the Safety Documentation under the heading ‘description of the methods of implementation of each type of ensuring the protection of classified information’, in the form of an updated description of the type of physical security, immediately, 
• under heading (i) in the form of filling in these data in the entrepreneur's questionnaire (only a business partner from the USA, because the total volume of trade with him exceeds 2.000.000, - CZK), within the framework of the annual notification of changes, which it is obliged to make on the date that coincides with the date of issue of the Facility Security Clearance, 
• under heading (h) in the form of filling in these data in the entrepreneur's questionnaire and in the form of an updated part of security documentation '… Classified Information Enumeration', within the framework of the annual notification of changes, which it is obliged to make on the date that coincides with the date of issue of the Facility Security Clearance, 

When submitting a subsequent application for the issue of a Facility Security Clearance pursuant to Section 96(3) and (4) of the Act is then obliged to in the entrepreneur’s questionnaire, provide the data in the manner described for this application under point 3.

Since the last annual notification of changes (Section 7(3) (b)) of the Industrial Security Decree has also changed classified information stored with the entrepreneur, he is also obliged to fill in the data under heading (h) of the entrepreneur’s questionnaire and submit an updated part of the security documentation – ‘listing of … classified information’.

Please note:

If the entrepreneur fails to comply with the above-mentioned minimum deadlines for submitting an application for the issue of the Facility Security Clearance under Section 96(3) and (4) of the Act, will be obliged to submit a new complete basic application according to the law - see above - the details of the ‘basic’ application for the issue of the Facility Security Clearance under the Act – including payment of the administrative fee under Act No 634/2004 on administrative fees, as amended, when applying for the issue of the Facility Security Clearance.

For a request under Section 96(3) and (4) of the Act any subsequent application is not considered, regardless of how the security procedure relating to the previous application was (or was not) completed.

For example:

If the entrepreneur has submitted an application for the issue of a Facility Security Clearance and the procedure:

• has been stopped,
• has been terminated by a decision not to issue a Facility Security Clearance,
• or is still ongoing,