Abstract
Joint-stock companies are among the most fundamental components of a market economy. "Voucher privatization" in the Czech Republic saw an abrupt mushrooming of joint-stock companies where none had appeared for over a generation. This occurred in an environment lacking in guiding institutional frameworks, offering only minimal protection for both minority and majority shareholders, which handicapped the country?s capital-market development.
Beginning in 1996, several improvements of the institutional framework were implemented. Now Czech commercial law is largely harmonized with European standards.
Weaknesses still persist in enforcement, however, and as such, both foreign and domestic investors prefer simpler forms of organization to limited-liability companies.