How does the growing wealth of domestic society affect the interest of Czechs in patronage or the popularity of wealth management tools such as trusts?
Increasingly, society is realizing that if someone is successful in their profession and their financial situation allows it, they want to share their success with the wider community by supporting the arts. Culture is cultivating, and private support for it is growing significantly. The example of trusts is appropriate, as founders who choose to structure their wealth in an estate structure are thinking of their descendants, but also usually in a socially responsible way. Almost every trust that we create has a public benefit component, whether in education, the social sphere or culture. Finally, success in the Czech business environment is also linked to an awareness of the need to support culture or the needy. Look at charity collections of any kind. For example, we raised CZK 70 million for the St. Vitus Organ in a public collection organised by the Bohemian Heritage Fund in just one year. If a meaningful cause can be found, the company will be happy to support it.
Can it be expected that the interest of Czechs in wealth management services will continue to grow?
No doubt. For a long time, it was believed that when you run a business, you concentrate on multiplying your assets and leave the organisation for later. This has changed in recent years, and asset protection is now a topic for everyone who has assets. We also have to remember that today’s generation of founding fathers of Czech businesses is the first in a long time to have the space, resources and freedom of decision to provide such support. Family assets that will be passed on in society between generations deserve to be organised in the form of trusts or endowments. Through such an estate structure, the founders ensure that the estate fulfils the legacy that is closest to their values.
About the law firm
On 1 March, the law firm Císař, Češka, Smutný changed its name to Portos and entered a new phase of its existence. The firm was founded by lawyers Jaromír Císař, Zdeněk Češka and Pavel Smutný in 1993. “We founded it with the aim of gradually building one of the most sought-after law firms that foreign clients would come to,” says Smutný. The original vision is being fulfilled. Portos represents major Czech companies, including CEZ and Čepro, and large banks. It helps its clients set up ownership structures abroad. The firm has grown beyond pure advocacy. In 2009, its partners founded the Bohemian Heritage Fund, and eight years later CCS Premium Trust. “We learned to see things through the eyes of our clients. That’s why we had to transform from a firm that provided individual legal services to a company that offers strategic legal advice and full-service legal services,” says Smutný.
In the last ten years, your law firm has created companies focused on asset management and trust funds, i.e. CCS Premium Trust, and the Bohemian Heritage Fund, through which you are closely connected with patronage and cultural support. What is the significance for clients of this “wrapping” of advocacy with other activities?
Our activities continue to expand just as we feel our clients have a need. The topic of property structures such as trusts has been missing in Czech society for almost sixty years. Since 2014, we have had them back and we rank alongside the UK, France, Switzerland and Liechtenstein in wealth management. This is not bad at all, it indicates great legislative maturity. The Bohemian Heritage Fund is then our answer to growing social engagement. We support important cultural projects that would not have happened without private money.
Why did you go into these areas?
For 33 years now, the Czech Republic has been a free enterprise, generational change is occurring and the topic of intergenerational transfer of business and property is very topical. Many of our clients face the question of how much money to sell their life’s work – their company – for. We come up with the option of not selling and passing it on to their descendants through the ownership structure. We come up with a solution to avoid burdening family relationships with a complex debate about property.
Not only business, your office has been undergoing a generational change in recent years. Zdeněk Češka, one of the three founders, died last year. In addition to the two original partners, two new partners – you and Petr Michal – have been at the helm of your office for three years. How do you view these changes through the eyes of an attorney who is now experiencing first-hand what his clients enjoy?
Naturally, the office changes and develops generationally. It is generationally permeable, that is the message we give to our younger colleagues. The people in the immediate leadership share the values and the vision of how it should evolve. So the office is gradually developing a wider decision-making board that contributes to its direction. And this is no longer based on the sole decision of the three owners, but on collective decision-making. This makes us stronger.
These days, the office is changing its name from Císař, Češka, Smutný to Portos. Is this also part of the generational change?
This is primarily in response to our portfolio of services and clients. We have a number of activities abroad, with an order of magnitude more people involved in management than in the past. And because of this, we want our office to have a name that is not tied to the founding partners. The name change is intended to speak primarily from within the firm. We are inviting new colleagues – senior lawyers, new partners – up to the top of the firm. We want to let them know that the firm’s structure is pervasive. In short: we are transforming a personal business into an institution. Among other things, this is to open up a much greater scope for service delivery.
Jakub Hollmann
He is a partner in the law firm Portos (Císař, Češka, Smutný) and also the Chairman of the Board of CCS Premium Trust, a company providing asset management services. In addition to advising on the establishment of Czech variants of trusts and endowments, Jakub Hollmann has extensive experience in establishing their foreign alternatives, in particular Liechtenstein and British trusts. In 2022, he published a book entitled Trusts for Practice.
How did the new name Portos come about and what should it evoke for clients?
It was created as a reaction to the search for a synonym to name our attitudes and services. Porthos is first and foremost freedom – we are free to make up our minds and fight for them. Portos is a port – a safe haven for our clients and a place where business interests and cultures meet. Portos is a gate – from the Latin porta. A gateway as a window to the world, for us it means openness. And finally, Portos as Porthos, one of Dumas’ Musketeers, symbolizing courage and loyalty, which are our firm’s values.
The change of the office’s name is supposed to be, among other things, an impulse to expand its services. What areas do you want to venture into?
We want to follow the path of asset management and asset structures, which we have been focusing on for a long time. Clients are looking for a one-stop shop for their business. When a client comes to a law firm, they want to find not only legal services, but also tax, accounting and real estate advice all in one place. These are the directions in which we want to expand our services.
But this is a trend that more law firms have been following lately. How do you want to stand out in this competitive market?
In our case, it’s very much related to foreign countries. Roughly half of the structures that we set up for clients in the asset management business are abroad. Clients therefore need international tax advice. And that is definitely not standard in the domestic legal market.
Last year, Císař, Češka, Smutný celebrated its 30th anniversary. That would seem like the perfect time to announce changes. Why are you coming up with them a year later?
It is not common for a law firm to operate on the Czech market for 30 years. We wanted to experience this anniversary. Císař, Češka, Smutný deserved it. Porthos continues from March 1, 2024 – on the day exactly 31 years after the founding of the original firm.
The full interview can be found in Hospodářské noviny (4 March 2024).
