The Supreme Court in Brno has issued a landmark ruling on the Covid closures. According to the decision, entrepreneurs are not entitled to compensation for lost profits during the pandemic-related sales bans in 2020. The judges made it clear that the Crisis Act provides no legal basis for such claims.
The Supreme Court of the Czech Republic (Nejvyšší soud) has definitively ruled that entrepreneurs have no entitlement to compensation for loss of profit caused by the pandemic-related retail closures during the state of emergency in 2020. According to the judges, the Crisis Act does not establish an automatic right to compensation for economic losses resulting from general anti-epidemic measures.
The court examined a claim brought by a company selling tobacco products and mixed goods, which demanded compensation from the Ministry of the Interior for the period in which its shop had to remain closed due to a government resolution. The claimant relied – as did several legal experts – on the wording of § 36 of the Crisis Act, which stipulates a state obligation to compensate damage arising from crisis measures.
The Court, however, analysed not only the wording of the provision, but also its legislative history, purpose, and its relationship with other legal regulations. It clarified that § 36 is primarily intended for damage incurred in the fulfilment of state-imposed obligations – for example, when citizens are required to provide material resources or labour and thereby suffer specific damage that is not otherwise compensated.
This does not apply to general, wide-ranging restrictions such as the temporary closure of shops to protect public health. Such economic burdens are only compensable if explicitly provided for by law – which was not the case for the pandemic-related closures. The Court rejected an extensive interpretation that would also cover lost profit.
At the same time, the Supreme Court stressed that it is aware of the severe consequences of the measures for many entrepreneurs – as well as the moral argument that those who “make sacrifices for the common good” should be compensated. Nevertheless, the pandemic affected society as a whole, and it is not the role of the Court to undertake a comprehensive financial balancing exercise after the fact.
Neither the Crisis Act nor any other applicable legislation can therefore be interpreted as requiring the state to compensate all economic damage arising from the pandemic.
However, the ruling does not bring a definitive end to all Covid-related cases. It does not address state liability under the Pandemic Act (No. 94/2021 Sb.), compensation for damage caused by measures of the Ministry of Health that were annulled by administrative courts for unlawfulness, or other types of damage beyond loss of profit caused by restricted opening hours.
The ruling, file number 30 Cdo 2060/2024, will be published from 8 to 23 December 2025 on the physical and electronic notice board of the Supreme Court. It will then be removed and subsequently made permanently available in pseudonymised form in the public database at nsoud.cz.
