Czech Business and Trade 1/2012

1 2012 ENERGY LAW IN PROCESS OF CHANGE REGION OF CENTRAL BOHEMIA COMPETITIVENESS OF ICT SECTOR ECONOMY STILL DRIVEN BY EXPORT 1 2012 NANOTECHNOLOGY,BIOTECHNOLOGY, MEDICAL,OPTICAL,ANDMEASURINGDEVICES SupplementofCzechBusinessandTrade

2

3 | Czech Business and Trade INTRODUCTION Questions of the Month for Martin Kuba, Minister of Industry and Trade 4 ECONOMIC POLICY Economy Still Driven by Export, Uncertain Development in 2012 5 ENTERPRISE Year 2012 Brought a Number of Tax Changes 7 Most Important Legal Changes in 2012 8 INFORMATION TECHNOLOGY What is the Market Standing of IT Experts Like? 10 Competitiveness of Information and Communication Technologies in the Czech Republic 12 The Czech Republic Must Concentrate on Innovation and High Added Value 15 About 220 000 IT Specialists Working in the Czech Republic 17 IT Virtualisation Benefiting Business 17 The Future of Czech IT Rests with Small Innovative Start-up Firms 18 ENERGY The Czech Republic Is a Country with Highly Open Energy Industry 21 Energy Law in Process of Change 25 KALEIDOSCOPE CREA Hydro&Energy Cluster Enters a New Stage of Cooperation 28 Stricter Conditions for Starting Insolvency Proceedings 28 Active Role of ICC Czech Republic 28 The Czech Republic Has the World’s Third Best Nuclear Safety Rating 28 REGION Region of Central Bohemia – Good Address for Quality Investments 30 PRESENTATION OF FIRMS ATLAS, spol. s r.o.; Babcock Borsig Steinmüller CZ s.r.o.; CREA Hydro&Energy, o.s.; CS SOFT a.s.; EGÚ Brno,a.s.; FANS, a.s.; JANKA ENGINEERING s.r.o.; KOVOSVIT MAS, a.s.; Letiště Praha, a. s.; M.I.P. Advertising, a.s.; MOSTAREZ a.s.; NOEN, a.s.; PP Agency s.r.o.; TurboConsult s.r.o.; TÜV SÜD Czech s.r.o. C Z E C H B U S I N E S S A N D T R A D E Economic Quarterly Magazine with a Supplement is Designed for Foreign Partners, Interested in Cooperation with the Czech Republic IssuedbyPPAGENCYs.r.o.incooperationwith Ministry for Regional Development of the Czech Republic MinistryofIndustryandTradeoftheCzechRepublic Ministry of Foreign Affairs of the Czech Republic Confederation of Industry of the Czech Republic Confederation of Employers‘ and Entrepre- neurs‘ Associations of the Czech Republic Czech Chamber of Commerce CzechTrade PARTNER OF THE MAGAZINE: ICC Czech Republic EDITORIAL BOARD: Michal Bakajsa, Zdena Balcerová, Martin Dvořák, Štěpánka Filipová, Josef Jílek, Ivan Jukl, Dagmar Kuchtová, Marie Pavlů, Pavla Podskalská, Josef Postránecký, Libor Rouček, Miroslav Somol, Jarmila Škvrnová, Jan Špunda, Martin Tlapa, Zdeněk Vališ, Jan Wiesner MANAGING EDITOR: Pavla Podskalská EDITORS: Jana Pike, Monika Suchá TRANSLATION: Vlasta Benešová, Alena Kenclová, Robert Krátký PROOFREADING: Matthew Booth, Pearl Harris, Ivana Kadlecová GRAPHIC DESIGN: Art Director: Anežka Zvěřinová Graphic Designers: Pavel Kroupa, Anežka Zvěřinová Production: Anežka Zvěřinová DEADLINE: 10/3/2012 © PP Agency ADDRESS: Myslíkova 25, 110 00 Praha 1 Czech Republic Phone: +420 221 406 622 e-mail: journal@ppagency.cz www.ppagency.cz, www.doingbusiness.cz Press run: 10 000 copies. It is not allowed to reproduce any part of the contents of this journal without prior consent from the editor. Attitudes expressed by the authors of articles carried by CBT need not necessarily be consist- ent with the standpoint of the Publisher. MK ČR E 6379, ISSN 1211-2208„Podávání novinových zásilek povoleno Českou poštou, s. p., odštěpný závod Přeprava, č. j. 3468/95, ze dne 24/10/1995“ Cover photo: www.sxc.hu Page 3 photo: ČEZ company archives

| 4 I N T R O D U C T I O N Questions of the Month for Martin Kuba, Minister of Industry and Trade Photo:MinistryofIndustryandTradearchives,www.sxc.hu Excessive administration complicates the business environment. What meas- ures are you planning to improve the situation? Reducing administration is an absolute necessity. I am persuaded that quite a number of laws still contain illogical pro- visions contradicting each other, which do not link up together and sometimes require two different means for one obli- gation to be fulfilled. Our intention is to make business in the Czech Republic as attractive as possible and the Ministry of Industry and Trade (MIT) a reliable part- ner to businessmen. The State must not lay obstacles in the way of businessmen and entrepreneurs. On the contrary, it must give assistance to Czech citizens and firms, the driving force of the economy. Before the end of the election period, we want to cut the administrative burden by 30%. This means eliminating dozens of paragraphs every year. The Ministry of Industry and Trade alone has some four dozen administrative obligations on the table requiring abolition. One of the most significant excessive administrative cuts provided for recently is the latest Trade Licensing Act Amend- ment, which will save businessmen more than CZK 250 million a year. In our work, we are strongly inspired by the wishes and initiatives of businessmen. Of great assistance are the regular meet- ings of the Business Council, my advisory body, whose members are representatives of the state administration and the private sector, acting through the intermediary of their unions and associations. The government has approved the Czech Republic’s 2012-2020 Export Strategy. The Strategy is intended to open up new markets for Czech export- ers and give them state support. What is its main aim? The aim of the new Strategy is to change the extremely high dependence of Czech exports on the EU27 economic cycle and to help Czech firms trade their products more widely in the world, not only as pri- mary subcontractors. The Strategy places emphasis on the positive changes in the Czech economy and on boosting high value-added exports. The document was prepared in close cooperation with the Czech Chamber of Commerce and the Confederation of Industry of the Czech Republic. The starting point for the Ex- port Strategy is to define the key markets for Czech exporters in collaboration with the business sphere, on the basis of the growth potential of the countries con- cerned and the absorption capacity of the markets. As a rule, the priority countries are the large economies with markets in which Czech firms have already oper- ated in the past, and markets in which the Czech presence is lagging behind rival countries. The target countries are those with high import growth levels and a potential for Czech imports, specifically Asian and Latin American countries. As regards the European Union, we want to focus on maintaining our position and promoting it especially in favour of small and medium-sized enterprises. Our aim is to double the number of foreign representations in countries with a potential for Czech exporters, through integration and efficient coordination in the framework of the Ministry of Industry and Trade. The Ministry of Industry and Trade is pre- paring a State Energy Concept that will set out the conditions for the domestic power industry for the next 25 to 30 years. What principles should it be based on? It is necessary to stabilise the energy sys- tem and use domestic resources as much as possible. The State Energy Concept must primarily suit the Czech economy. In my estimation, nuclear power stations will in future cover more than half of the country’s domestic energy consumption. At the same time, however, we also want to support renewable sources, but on condition that they will generate elec- tricity under economically acceptable conditions. In this connection, one has to be reminded that, for example, solar power stations cost the Czech Republic some CZK 32-35 billion each year. Within the framework of the Energy Concept, we also want to accelerate the construc- tion of energy transfer networks. The purpose of this plan is to keep pace with the construction of new energy sources elsewhere in Europe. This will also require speeding up construction permission proceedings. The aim of the Concept is clear: to support the economy, stabilise energy prices and, last but not least, meet the energy needs of the Czech Republic. Martin Kuba

5 | 2011 was a year of escalation of the European debt crisis. Besides peripheral countries such as Greece, Ireland, and Portugal, states impor- tant for the system, such as Italy and Spain, also faced debt problems on governmental level. The crisis of European government bonds started to negatively affect the health of the European financial sector and sub- sequently also the growth perform- ance of the eurozone, our number- one trade partner. In the second half of 2011, the Czech economy found itself in a technical recession. E C O N O M I C P O L I C Y The Czech economy entered the year 2011 successfully, with growth in exports and industrial production as well as the economy as a whole, largely thanks to the excellent condition of the German economy, which last year recorded the best macroeconomic results since reunification in 1990.The second half of the year was already negatively influ- enced by the impacts of the European debt crisis on the demand for Czech exports. In the whole of 2011, the Czech economy rose by 1.7% measured by real GDP, after a 2.7% increase recorded in the previous year; but quarter-on-quarter drops were recorded in the second half of the year. Last year the Czech economy was driven solely by foreign demand. The contribution of net exports to economic growth even ex- ceeded 3 percentage points, the contribution of domestic demand was thus negative. The 2011foreigntradesurplus(accordingtocross- border statistics) amounted to more than CZK 190 billion (approximately, which was a year- on-year improvement by over CZK 70 billion and the best result ever). The improvement was mainly due to the export of machinery and transport equipment. The balance was favourably influenced by the lower import of solar panels year-on-year. A worsening was recorded by the commodities balance, es- pecially due to the higher prices of imported commodities, but this was more than com- pensated by an improvement in the balance excluding commodities. Compared with 2010, total exports increased by 13.2% and imports rose by 10.9%. It was particularly the improvement in foreign trade in goods and services that was behind the improvement in the balance of payments current account deficit to 2.1% of GDP from 3.1% of GDP in the previous year. The deficit was more than cov- ered by surpluses in the balance of payments capital account, and particularly financial ac- count.The Czech Republic did not suffer from an external imbalance last year either. MANUFACTURING SECTOR WAS MOST SUCCESSFUL In terms of gross value added, manufacturing ranked among the most successful sectors last year. In terms of branches, good results were achieved especially by the car-mak- ing industry, the related plastics production, and engineering, which means above all procyclical branches dependent on foreign demand. On the other hand, the energy sec- tor, and the food and electrotechnical indus- tries did not achieve good results. Last year, industrial production was 6.9% higher in real terms, but the services sector as a whole did not follow suit when it showed a real drop of 1.5%. A moderate growth was recorded only by sales in transportation and storage (+1.2%), and in administrative and support service activities (+4.3%). After a fall in the previous three years, a slight improvement was recorded in sales in the sector of accom- modation and food service activities (+0.6%). Sales in the other sectors have contracted: in information and communication activities by 1.6%, in the area of real estate activities by 3.8%, and sales in the areas of professional, scientific and technical activities decreased by 9.1%. An unfavourable situation contin- ued in construction for the third year running, building production contracted by 3.1% last year and was thus more than 10% lower than in the 2008 boom year. While output in the construction of buildings recorded a 0.3% year-on-year drop last year, civil engineering decreased by 8.7%. The reasons are lower in- vestment activity on the part of corporations, Economy Still Driven by Exports, Uncertain Development in 2012

| 6| 6 E C O N O M I C P O L I C Y Photo:www.sxc.hu and particularly fiscal consolidation evident in the absence of large infrastructure projects financed from public sources. In addition the Czech Republic did not take full advantage of the EU funds it could draw. PUBLIC FINANCE IN A MUCH BETTER SHAPE THAN PEERS, NEVERTHELESS CONSOLIDATION NECESSARY FOR LONG-TERM SUSTAINABILITY Although the state debt of the Czech econ- omy is one of the lowest in Europe (last year it reached the level of slightly above 40% of GDP), its dynamics and especially the debt situation in some European countries make fiscal consolidation essential. It has to be implemented on both the expenditure and revenue sides. Last year the government re- corded a deficit of CZK 142.8 billion, which is an improvement of almost CZK 14 billion in comparison with 2010.The approved budget had envisaged a deficit of CZK 135 billion. However, according to ESA methodology, which takes into account also payments from EU funds that have not yet been effected, the deficit amounted to CZK 124.2 billion. The Ministry of Finance estimates the overall deficit of public finances at 3.7% of GDP, after 4.8% in 2010. The government had originally expected a deficit at the level of 4.6% of GDP. MARGINAL WAGE GROWTH HAND IN HAND WITH LOWER HOUSEHOLD CONSUMPTION Less than 2% growth of the economy is not sufficient for the creation of new jobs. The first half of 2011 still showed an improving tendency. The only sector which positively contributed to this trend was industry, where employment increased by 3.0% last year. However, in the second half of the year this trend stopped. According to statistics from Labour Offices, the unemployment rate ended at 8.6% last year, after 9.6% a year be- fore. Domestic fiscal consolidation, the weak labour market, and only marginal real wage growth have led to the cautiousness of Czech householdsintheirspending.Realhousehold consumption thus even dropped by a half per-cent last year. True, retail sales as a whole recorded a fair 1.9% growth in real terms. But it must be noted that the result was due signifi- cantly to sales in the motor vehicle segment which, however, included the demand from the corporate sphere for new vehicles. After exclusion of the motor vehicle segment, only a minimum 0.4% growth was recorded last year. This figure reflects the growth in sales in the first half of 2011 and their contraction in the second half of the year. LOWEST REPO RATE EVER The weak consumer demand was reflected also in inflation development. Overall infla- tion reached 1.9% last year and was thus just under the two-per-cent inflation target of the Czech National Bank. It stayed below this level for most of 2011. The inflation rate ex- ceeded 2% only in the last months of last year, exclusively due to factors which are beyond the control of the Central Bank. Food retailers startedtoincludetheincreaseinthelowerVAT rate from 10% to 14% in their prices ahead of the official effective date at the beginning of this year. Inflation accelerated further in Janu- ary 2012 as prices in the housing sector were affected by the deregulation of rents, and especially by higher energy prices, including gas.The last major inflation category was rep- resented by fuel prices. After adjustment for the above mentioned factors, inflation pres- sures in the economy were minimal. Given the above facts, and the anchored inflation expectations, it is no surprise that the Cen- tral Bank kept its key two-week repo rate at the historically lowest 0.75% throughout last year. The minimal interest yield and the ab- sence of speculative capital in the economy were reflected in the stable exchange rate of the Czech crown to the euro between about 24.00 and CZK 24.60/EUR in the first half of the year, in the second half, the crown weakened to approximately CZK 26.00/EUR as a result of the slackening economic activity at home as well as abroad and rising risk aversion on the global markets. EXPECTED DEVELOPMENT IN 2012 UNCERTAIN In 2012, the performance of the Czech econ- omy will again derive from the condition of our most important trade partners. Given the fact that the EMU economy has been in reces- sion since Q4 11, that the orders of German factories dropped significantly in the second halfoflastyearanda decliningtrendisevident also in the registration of new cars in the euro- zone, the future development of the domestic economy remains very uncertain. Along with declining profits, high investments cannot be expected in industrial enterprises, not even in the environment of low interest rates. Invest- ment activity and particularly construction are expected to be negatively affected also by the limited public expenditures on the infra- structure. Nor will the Czech economy receive a boost from the side of household consump- tion, which will be adversely affected by fiscal restriction (e.g. freeze in public wages and VAT rate hike) and a worsened situation in the job market.WeexpecttheGDPriseofa mere0.1% over the whole year, after last year’s 1.7%. Due to the weak consumer demand, inflation is not a problem. Although the consumer price dynamics will exceed the level of 3% at the beginning of the year, it will be only the effect of a temporarily weaker currency, tax changes, and regulated prices. Nevertheless, in the fol- lowing months inflation pressures will ease, which should be noticeable in the declining year-on-year dynamics from the second quar- ter. We expect a 2.5% inflation rate at the end of the year. On average, inflation would thus amount to 2.9% this year. The CNB will prob- ably leave the rates unchanged for a relatively long period. Our forecast expects the key rate at the level of 0.75% up to the end of 2013. Notwithstanding the temporary acceleration of the consumer price growth above 3%, infla- tion neither is nor is likely to be a problem in the Czech conditions this year At the end of this year, the Czech crown should be stronger vis-à-vis the euro. The weakening of the currency since last Septem- ber has reflected the lower economic activity of the eurozone and a weaker demand for Czech exports. A weaker crown helps to ease monetary conditions and has a stimulating effect on the economy. In a one-year horizon we expect the crown to strengthen towards CZK 24.50/EUR. A look at the domestic fun- damentals leads us to conclude that a signif- icant weakening of the crown beyond CZK 26/EUR is not justified. Nevertheless, from the viewpoint of risks we cannot exclude another wave of weakening for the coming period es- pecially in case of an increased risk aversion in the financial markets but, on the other hand, we see a risk in the year’s outlook from an even stronger domestic currency. Jan Vejmělek Chief Economist and Head of Economic & Strategy Research Komerční banka, a. s. E-mail: jan_vejmelek@kb.cz www.kb.cz

7 | E N T E R P R I S E The beginning of 2012 brings with it a number of tax changes especially in the field of value added tax, in- come taxes, and property taxes. The most significant of these changes are described below. This year, on 1 January, new rules for the application of value added tax in the pro- vision of construction and assembly work on the amendment No. 47/2011 entered into effect. This is the so-called reverse charge or reverse charge procedure, which means that during the provision of con- struction or assembly work between two businesses registered for VAT within the Czech Republic the recipient of such work is obliged to declare output value added tax. One is referring to the reverse charge procedure in those cases when providing the performance from or to another tax- payer, place of performance is located in the Czech Republic and it is a building or construction work, which corresponds to the code 41 (Buildings and construction), 42 (Civil engineering and construction) or code 43 (Specialised construction work) product classification (CZ-CPA). In such case the supplier does not indicate the amount of value added tax in the invoice. Duty to supplement and admission the amount of tax will be on the subscriber. THE INCREASE OF VAT FROM 10% TO 14% Commencing from 1 January 2012, so- called “rate amendment” to the VAT Act No.370/2011 Coll. entered into effect, which increases the lower VAT rate from 10% to 14%. The basic VAT rate is un- changed in 2012 and remains 20%. However, there will be a unification of VAT rates to a single rate of 17.5% with no ex- ceptions from 1 January 2013. The amend- ment also includes other changes that were incorporated such as the extension of the range of exceptions, when the de- duction can be applied at the input with- out holding a tax receipt (§ 73 paragraph 1 point e)), the definition of fixed assets was extended by the technical evaluation (§ 4 paragraph 3 letter d)), deadline for the adjustment of deductions for techni- cal evaluation of real estate was extended from 5 to 10 years (§ 78 paragraph 3), rules for the offsetting deduction for invento- ries are specified (§ 77), etc. The part of the rate amendment is also the change of the Law on income tax, which should com- pensate the impact of the rate amend- ment. The tax relief for a child increased by CZK 150 per month (about EUR 6) and the maximum amount of the tax bonus to 60 300 CZK (approx. EUR 2412), originally 52 200 CZK (approx. EUR 2088). INCOME TAX Based on Amendment No.346/2010 Coll., there is a change in the discount on the taxpayer, which is now CZK 24 840 (ap- prox. EUR 994) and thus corresponds to the value valid for the year 2010. Probably the most radical change in the income tax amendment was made under the Health Insurance Act. The provision concerning the tax non-deductibility of remuneration of members of statutory and other bodies of legal entities was deleted. That means that the group of persons who are mandatorily covered by health insurance was enlarged by other wage earners, which were involved only in pension insurance. These are the share- holders and executive directors of limited companies and limited partnerships, if outside the employment relationship they perform work for the company for which they are paid, and team members who are engaged in cooperative bodies outside the employment relationship as a reward. In addition, there will be new participa- tion in health and pension insurance to members of collective bodies of legal entities, liquidators, authorised agents if their income is considered as an income from employment under the Act on In- come Tax and managers of organisational units of foreign legal entities registered in the Commercial Register of the CR. Con- ditions for the participation in health and Year 2012 Brought a Number of Tax Changes

| 8 This year has been really active with legislative changes. Employers must now deal with the amended labour laws, and firms need to get used to the possibility of criminal prosecu- tion for their actions. E N T E R P R I S E Photo:www.sxc.hu There have been also significant changes in the commercial code (spe- cifically law No. 351/2011 Coll., which amends law No. 513/1991 Coll.). A truly ground-breaking stipulation can be found in the new section 66d (entrusting with business management), which reacts to another situation that had proved prob- lematic in practice. It explicitly allows for a concurrent exercise of the functions of both a statutory organ member and a company manager. Company business management can now be exercised as a labour relation. Other changes include the obligation to provide evidence of legal reasons for using a recorded seat or place of business and changes in provi- sions pertaining to the trade register and the registry of documents (e.g. there is no longer the obligation to file specimen signatures of statutory organs in the reg- istry, it will now be mandatory to record date of birth, and birth numbers will no longer be included in the public part of the trade register). A single physical en- tity may now found a joint stock com- pany, which was not possible before, and stockholder rights may now be exercised while increasing the basic capital from the date of the effective underwriting of shares, not from the day the basic capital increase is recorded in the trade register (clarification: these two changes are set forth in the amended commercial code, which is a part of the amended transform- ation act). Most Important Legal Changes in 2012 pension insurance are identical to that of an employee. On 1 January 2012 there was also abol- ished the tax exemption of corporate in- come in § 19 paragraph 1 of the ITA to the income from the operation of lotteries and other similar games based on amend- ments to the Act to amend the laws relat- ing to the establishment of a collection site and other changes in tax laws and insurance in case gambling taxes, and depreciation of the possibility of statute- barred debts, unlike the previous year, when debts were written off following a tax deductible expense. REAL ESTATE TAX On 1 January 2012 entered into effect an amendment to Act No. 338/1992 Coll. real estate tax, as amended, published in the Collection of Laws under No. 212/2011, which according to § 6 paragraph 2 of the Law says that paved areas of land used for business purposes or in connection with are becoming subject to the tax on land with a special rate. § 6 paragraph 5 of Act No. 338/1992 Coll. says that: “paved land in this Act means land or its part in sq. m, registered in the Land Registry with the kind of other land area or built-up area and courtyard, whose surface is reinforced building under the Building Act without the vertical structure.“ The new legislation applies only to land registered in the Land Registry of real es- tate property types of building and court- yard and other areas. It must therefore be the land on which the building is located. The construction strengththening the surface is a building as defined in § 2, par- agraph 3 of Act No. 183/2006 Coll. Territo- rial planning and Building Code (Building Act), as amended. Jakub Kovář Nexia AP e-mail: kovar@nexiaprague.cz Member:

9 | C Z E C H B U S I N E S S A N D T R A D E EASIER TRANSFORMATIONS OF COMMERCIAL COMPANIES Also, on the 1st of January, the Law No. 355/2011 Coll. came into effect, which amends the Law No. 125/2008 Coll. on transformation of commercial companies and cooperatives. The amendment in- cludes new requirements of the European legislation that bring a respite in the area of information obligations, broaden the forms of cross-border transformations, allow for a relocation of seats abroad and vice ver- sa, and extend and reinforce partner and creditor rights; a new provision stipulates that, under specific conditions, stocks or shares of entities that did not agree with the transformation must be redeemed. COMPANIES HAVE CRIMINAL LIABILITY The new Law No. 418/2011 Coll., on corpo- rate criminal liability and prosecution, im- pacts legal entities with a seat, enterprise, organisational unit, property or activities in the CR while committing criminal acts. A criminal act is attributed to a legal en- tity if the act is committed on its behalf, in its interest, or as a part of its activities by a member of its statutory organ, person au- thorised to act on behalf of the legal entity, person performing managerial or control activities or exercising a decisive influence on its management, and, under specific cir- cumstances, an employee. And what kinds of penalties to impose for this liability? Dissolution of the legal entity, forfeiture of property, commodity or other property asset, financial penalty, ban on activities, ban on participation in public orders, ten- ders and concession proceedings, ban on receiving subsidies and subventions, pub- lication of the ruling. The listed bans may imposed for a period of 1–20 years. NEW LABOUR CODE PROVISIONS The amended Law No. 262/2006 Coll., or labour code, also brings a number of changes. The most often discussed one is the payment of severance money. A per- son who works for a company for less than a year now receives one average monthly wage upon their dismissal. If they work for a company for one to two years, they are entitled to two wages. If they work for more than two years, it is the equivalent of three average monthly wages just like it used to be before. Another change is the introduc- tion of a new reason for dismissal. Employ- ers will get a chance to dismiss employees who grossly abuse their sick-leaves during the first 21 days of their employment. The period that a person may be employed for annually on the basis of an agreement to perform work was increased from 150 to 300 hours. However, if an employee’s earn- ings from agreements to perform work exceed CZK 10 000 (approx. EUR 400) per month, they will now have to pay health and social insurance from these earnings. Only a 15% tax was paid from these earn- ings up until now.

| 1 0 I N F O R M A T I O N T E C H N O L O G Y Fromthemid-1990sto2002,the proportionofITexpertsoftheemployed populationintheCzechRepublicrose steadily(from1.2%in1995to1.9% in2002).Thelightswingintheyears 2003-2005canbeascribedtoadelayed reactiontotheInternetstart-upfirms’ “bubbleburst”,asintheCzechRepublic theeuphoriawanedalittlelaterthanin theUSAandWesternEuropeancoun- tries.Thistemporarywaning,however, wasfollowedbyarevival,promptedby foreigndirectinvestmentsflowinginto thestrategicservicesareaandbyfirms, likeMicrosoft,Accenture,LogicalCMG, DHL,etc.,whichbenefitfromdifferent formsofoutsourcingandnearshoring. What is the Market Standing of IT Experts Like? education (48% as against 44%). This trend continued, with university graduates in 2010 accounting for 50% of IT experts. In that year, there were 40 000 persons trained in Informatics in the Czech Republic, nearly 31 000 of whom had regular employment, with 18 700 (61%) of them having the sta- tus of IT expert. MOST IT EXPERTS ARE WORKING IN PRAGUE As regards international comparisons, in 2009 IT experts in the Czech Republic ac- counted for 2.3% of the employed popu- lation, more than the EU27 average, which in that year was 1.8%. The best values of that indicator in 2009 were shown by Sweden, Switzerland, and the Netherlands, where IT experts accounted for more than 3% of the employed population. On the other hand, values under 1% were shown by Romania, Lithuania, and Greece. The largest number of Czech IT experts work in Prague, where, in 2010, they accounted for 5.8% of the total employed popula- tion. In absolute figures, this amounted to nearly 38 000 persons employed as IT ex- perts. Prague was followed by the Mora- via-Silesia Region with 14 500 IT experts, then the South Moravia Region (13 300) and the Central Bohemia Region (12 700). SALARIES OF IT EXPERTS In 2010, the average gross monthly salary of an IT expert was something over CZK 44 000 (approx. EUR 1 760). Eight years earlier, in 2002, the gross monthly salary of IT experts was slightly over CZK 26 000 (approx. EUR 1 040). In that period (2002- 2010), the salaries of IT experts increased by an average of 6.6% p.a., while the over- all average annual growth of salaries in AVERAGE GROSS MONTHLY SALARIES OF IT EXPERTS AS MEASURED BY COMPANY SIZE Company size Total/in CZK 2007 2008 2009 2010 10 to 49 employees 33 988 36 822 36 628 40 453 50 to 249 employees 34 660 38 013 42 013 40 829 250 to 999 employees 43 968 48 268 47 816 48 833 1000 to 4999 employees 38 944 40 888 40 974 40 547 5000 and more employees 40 203 44 158 44 202 45 791 Total 40 552 43 703 43 952 44 209 EUR 1 = CZK 25.515 Source: Structural wage statistics In 2010, there were nearly 122 000 IT ex- perts in the Czech Republic, 60% of whom (approx. 73 000) were Computer Tech- nology (CT) workers, and 40% (approx. 49 000) CT scientific workers and experts. The largest category of workers among CT scientists and experts are Program- mers (more than 32 000), and the largest group among CT technical workers are Operators and Attendants (26 000). In 2010, IT experts accounted for 2.5% of the employed population. Until 2008, per- sons with completed secondary education slightly prevailed among the IT experts, their proportion in 2008 amounting to 49%. In 2009, the proportion of IT experts with tertiary education prevailed for the first time over specialists with secondary the Czech Republic in the period under review was 4.6% (average gross monthly salary in the Czech Republic in 2002 was less than CZK 20 000, approx. EUR 800, and in 2010 it amounted to more than CZK 28 000, approx. EUR 1120). There are considerable differences in the aver- age gross monthly salaries of IT experts among the regions. It is not surprising that the highest average gross monthly salaries are drawn by IT experts in the capital city of Prague, where, in 2010, the average salary of an IT expert was nearly CZK 54 000 (approx. EUR 2 160). The sec- ond highest average monthly salaries of IT experts in 2010 were paid in the South Moravia Region, followed by the Central Bohemia Region. GREAT INCREASE IN THE NUMBER OF STUDENTS In 2010, more than 22 000 students were enrolled in university-level Informatics training courses, accounting for 5.7% of the total university enrolment. In compar- ison with 2001, the number of students enrolled in IT training courses more than trebled and their proportion of total uni- versity enrolment also increased. In 2010, more than 37 700 foreign nationals studied at Czech universities and more than 3 200 of these were enrolled in Informatics courses (in 2010, 529 foreign Informatics students graduated from higher learning institutions in the Czech Republic). Data Sources: NumberofITexperts–Selectivelabourforce survey(isalsocarriedoutinotherEuropeanstates) Information on student numbers – Institute for Information in the Education sector Other data – Czech Statistical Office

inzerce VIP Service Prague Airport, K Letišti 6/1019 160 08 Prague 6, Czech Republic +420 220 114 490, +420 220 562 525 vip.service@prg.aero, www.prg.aero DO YOU KNOW THAT… www.prg.aero …we will take you free of charge to the airport by limousine? …you only have to be at the airport 45 minutes before departure? …you can drink champagne in a luxurious lounge as late as 5 minutes before take-off? …we provide check-in for you and your luggage? …a limousine can take you all the way to the airplane? Don’t hesitate and order VIP Service Club CONTINENTAL at Prague Airport.

| 1 2 I N F O R M A T I O N T E C H N O L O G Y The Czech Republic, just as other countries, could not stay unaffected by the current economic problems provoked by growing uncertainties of the financial system and the sub- sequent global economic difficulties. Disregarding the fact that, according to the estimates of the Ministry of Finance of CR, the efficiency of the Czech economy in 2011 increased by 1.8%, in 2012 it is expected to be stagnant, with only a moderate 0.2- per cent GDP growth. Competitiveness of Information and Communication Technologies in the Czech Republic THE ICT MARKET Similar to other sectors of the economy, the Czech information and communication technologies (ICT) market copied the coun- try’s general economic development. At the time of the economic crisis, a large number of ICT firms had to address problems result- ing from their declining turnovers or the loss of key customers. A good thing was that the rather unfavourable economic situation stimulated them to take remedial measures, which in the end helped raise their operational efficiency or target their strategies more intensely towards the cus- tomers’needs. A review of current statistics is more op- timistic. Following the 4.9-per-cent year-on- year decline in 2009, IT expenses in 2010 increased by 5.5% year-on-year to 5.1 bil- lion dollars, according to the international analytical company IDC. The main growth booster was HW sales, with a 43-per-cent market share, followed by IT services (36%) and SW (21%). The economic crisis was most strongly in evidence in IT services spending, which in 2009 showed an 11-per-cent decline year- on-year (expressed in dollars) and in the fol- lowing year 2010 a further fall, by another 8.6%. Despite these dramatic figures, the decline was not so massive when expressed in the local currency, Czech crowns (CZK) (0.7% in 2009 and 1% in 2010). Unlike pre- vious years, when the main investor in IT services was the state administration, since the 4th quarter of 2010 this role has been played by the private sector. In terms of technological preparedness, the Czech Republic in 2011 placed 31st1) , according to the latest World Economic Fo- rum study. In terms of the overall standing measured by how widely information and communication technologies are used, the Czech Republic2) occupies the 40th position among 138 countries (a fall by 4 points in comparison with the previous study). In the global IT sector competitiveness valuation study prepared by analysts of the Economic Intelligence Unit (EIU) the Czech Republic placed 27th3) . IMPORTANT INVESTORS The high level of development of the Czech ICT market is a sign indicating that the Czech Republic is a frequent destina- tion for foreign investors in this industrial sector. The most important investment in the IT and strategic services sector in 2009 was made by Atento4) , which obtained the 2009 Investor of the Year Prize in that category. It won the prize for its modern Customer Service Centre opened in Brno. At the beginning, the Centre had 200 em- ployees working as operators and another 20 employess in service positions. In 2010 the number of its employees increased to 250. Together with its branches in Prague and Liberec, Atento employs nearly one thousand people. Second place in the 2009 Investor of the year competition, IT and Strategic Services Category, was won by Asseco Solutions, a company concerned with the develop- ment, application, and support of mod- ern information and economic systems. It obtained the prize for its investment in the development of new models and IT solutions, including the Helios information systems. The investor of the year 2010 in the IT and Strategic Services category is NetSuite. Its branch in Brno concerns itself with the research and development of top-level software equipment with the aim of in- novating and improving its own products. Brno is to become one of the company’s most important centres worldwide, to em- ploy up to 130 specialists, mainly in its de- partment for the development of software and quality assurance equipment. Photo:www.sxc.hu

inzerce RUSSIA 1997 MACEDONIA 1997 SLOVENIA 2006 CZECH REPUBLIC 1988 LITHUANIA 1997 Systems by CS SOFT since: BANGLADESH 2008 PHILIPPINES 2010 UAE 2008 CS SOFT a.s. ATM WORLD WIDE EXPERTISE „The aim of CS SOFT a.s. is to develop high quality ATM systems and to respond flexibly to customers´ requirements at the same time. Thanks to daily contact with regular air traffic controllers, we succeed in fulfilling this goal.“ Petr Mach, Managing Director and Chairman of the Board | YOU ARE SAFE WITH US | ATM SYSTEMS DEVELOPMENT SINCE 1988 | WWW.CS-SOFT.CZ WE ARE Reliable supplier of ATM systems Company with more than 20 years of experience Dynamic and modern company Company with advanced software development methodology Company with strong and stable team of highly skilled professionals Worldwide WE PROVIDE Air Traffic Management Systems Flight Data Processing Systems Surveillance Data processing Systems Systems for simulated training of ATCo ATC system modules Consulting (Feasibility Studies, Safety Assessment) Project Management

| 1 4 I N F O R M A T I O N T E C H N O L O G Y IBM Global Services Delivery Center Czech Republic occupied second place with a project comprising the enlargement of its strategic services centre and the provision of IT outsourcing services. The IBM Deliv- ery Center in Brno is one of the largest and most diverse centres of its kind in the world. It is building on the skills and talents of spe- cialists from all over the world and provides services in nearly twenty different language versions. In 2010, Cisco Systems opened in Prague its fifth Center of Excellence, through which it will provide remote support to 350 part- ners and 2 500 customers in 27 countries in Central and Eastern Europe and the Com- monwealth of Independent States5) . At first the centre employed 40 specialists, and its plan is to increase their number to 80 within one year. From what has been said above, it can be seen that in the past few years the Czech Republic has become an important centre for the provision of high added value serv- ices. Worth mentioning in this respect is a Gartner Group study of ideal countries for offshore IT services listing the Czech Repub- lic among the world’s thirty most suitable countries, pointing out its high education level, copyright protection, protection of personal data, and a well-developed trans- port infrastructure. In spite of this, a certain retreat from those positions can be observed, as shown by the regular world attractiveness scale of coun- tries for the location of high added value projects prepared by the A.T. Kearney con- sulting firm, called Global Services Location Index. In its first Index in 2004, the Czech Re- public held fourth place among the world’s most attractive countries, after India, China, and Malaysia. In its latest valuation, for 2011, CR occupies 35th place6) . ACCESS TO THE INTERNET The number of high-speed Internet users is growing steadily each year. This growth is much due to the wider offer of new services, lower prices, broader coverage and the continuing development of data technologies. Figures released by the Czech Statistical Office for 2011 show that nearly two-thirds (65%) of Czech households have a personal computer, or a notebook, at home. The ab- solute majority of those PCs make it poss- ible for their users to connect to the Internet (i.e. nearly 95% of those PCs). Unlike most other EU states, the most frequent way of Internet connection by Czech households is wireless (Wi-Fi) connection. This year, half of the households (51.3%) connected to the Internet are using this way of access. The number of WiFi connections makes the Czech Republic a European wireless internet access power. Other high-speed ADSL tech- nologies, or cable TV Internet access, are not so widely used (22.3%, or 21.2%). The most popular information and com- munication technology currently used by individuals, however, is the mobile phone. According to figures for the second quarter of 2011, the mobile phone is used by 94% of people over 16 years old. The use of the Internet by Czech econom- ic entities is also relatively wide. In the past five years, the number of enterprises with ten and more employees having access to the Internet has stabilised at 95%. As in the case of households, the method of connec- tion is changing in favour of high-speed Internet (over 2 Mb/s+), which in January 2010 was used by 86% of firms (EU27 aver- age was 85%). INTELLECTUAL PROPERTY RIGHTS PROTECTION – LOW SOFTWARE PIRACY RATE The progress made by the Czech Republic in the area of the protection, observance, and enforcement of intellectual property rights ranks this country among the world’s most advanced states. By intensive efforts exerted in recent years, the Czech Republic has built a very good basis for the efficient protection of intellectual property rights, on which all domestic and foreign inves- tors can rely. The Czech Republic is a party to the following most important international agreements and treaties concerning intel- lectual property rights, which preceded the signing of the WTO TRIPS Agreement (Agreement on trade-related aspects of intellectual property rights): the Berne and Rome Conventions governing copyright and related rights, the Paris Convention, the Madrid Convention, the Nice Conven- tion, the Lisbon Convention, the Protocol to the Madrid Agreement, the Trademark Rights Agreement, the Patent Cooperation treaty and the Convention on Awarding European Patents for Industrial Rights, the Budapest Biotechnology Invention Treaty, and the Integrated Circuit Layout Design Protection Treaty. After the signing of the TRIPS Agreements, WIPO (World Intellectu- al Property Organisation) agreements were made to further increase the protection of copyright and copyright-related rights. A recent study prepared by Business Soft- ware Alliance (BSA) shows that software pi- racy in the Czech Republic is falling steadily. In 2010, piracy declined by another percent- age point to 36%, close to the EU average of 35%. Since 1994, the piracy rate in the CR has been reduced by 30 percentage points from the original 66%, which ranks this country 12th among states with the lowest proportion of illegal software. In compari- son with the other EU member states, the Czech Republic places 11th, leaving behind not only all the post-communist states, but also many West- and South-European coun- tries, such as France (39%), Portugal (40%), Spain (43%) and Italy (49%). IT IN THE CZECH REPUBLIC COMPARES WELL WITH THE ADVANCED WORLD The dynamically growing information and communication technology industry has created a highly competitive environ- ment in the Czech Republic comparable with the world’s most advanced states. Every great innovation takes only weeks before getting to the local market and be- ing used by local entities. In other words, new investors arriving to this country will find there a competitive market with choosy customers, but also competent local partners with high business culture comparable with that of businesses in the other EU or OECD states. Miloslav Marčan CIO, Ministry of Industry and Trade E-mail: marcan@mpo.cz www.mpo.cz, www.businessinfo.cz 1) The Global Competitiveness Report 2011-2012: http://www.weforum.org/reports/global-competitiveness-report- 2011-2012. 2) See The Global Information Technology Report 2010-2011 Study: http://www3.weforum.org/docs/WEF_GITR_Report_2011.pdf 3) http://globalindex11.bsa.org/ 4) Source: CzechInvest. 5) http://newsroom.cisco.com/dlls/2010/prod_102110.html 6) http://www.atkearney.com/images/global/articles/FG-GSLI- 2010-1.png Photo:ICTUniearchives

I T 1 5 | “The Czech Republic Must Concentrate on Innovation and High Added Value,” says Svatoslav Novák, President of ICT Unie, a professional association of en- terprises operating in the information and communication technologies sec- tor, representing the Czech Republic’s ICT industry and associating approxi- mately 80 companies. In April 2011, the Ministry of Industry and Trade (MIT) and ICT Unie signed a Memorandum on Cooperation. To- gether with other associations operating in the IT and electronic communications sector, ICT Unie will create a platform for communication with central public ad- ministration authorities and will become an advisory body prepared to explain the key role played by the ICT industry in the economy of the Czech Republic. How is the Memorandum being fulfilled? One of the activities of ICT Unie, for exam- ple, is its participation in the work of the Government Council for Competitiveness and Information Society. ICT Unie actu- ally co-initiated the revival of the Council, which is one of the most important sites where intensive communication is taking place between the representatives of MIT and other ministries on the one hand and people from the “practical sphere”, i.e. rep- resentatives of ICT firms, on the other hand. One of the tangible results of the collabo- rative efforts between MIT and ICT Unie was the Czech participation, under the patronage of the Minister of Industry and Trade and the CzechTrade Agency, in the ITU Telecom World Exhibition in Geneva in the autumn of 2011. In co-operation with the Czech Technical University, ICT Unie organised a campaign among Czech firms and institutions, inviting them to present themselves at the event at a separate Czech stand. What kind of projects were presented at the exhibition by Czech firms? It was not the presentation of specific projects alone, although this part was also important. The Czech stand, one of about 20 national stands at this important event, covered an area of nearly 100 sq. m. Its motto was: “The Czech Republic – a Coun- try of High ICT Skills and Knowledge”. Its justification was proved on the spot, among other things, by representatives of Czech Post, the Electrotechnical Faculty of the Czech Technical University in Prague, the CESNET association and a number of other institutions and private firms. For ex- ample, Czech Post presented its data box project and the Czech POINT system at the forum. Equally important and interesting was following the current trends in tele- communications, also involving the pres- ence of African states and countries of the former Soviet Union. ICT Unie is an important partner in the efforts at realising the goals of the docu- ment, the “Digital Czech Republic”, deal- ing with the development of electronic communications, in particular the devel- opment of high-speed Internet access. Does the Czech Republic bear comparison with other EU states in this area? The Czech Republic still has a lot to catch up with in comparison with the most ad- vanced European and world economies, es- pecially as regards high-speed broadband Internet access. This “e-gap” is planned to be filled in a couple of years, as one of the tasks laid out by the “Digital Czech Repub- lic” document, in the preparation of which ICT Unie experts participated. ICT Unie participated in the preparation of the Czech Republic’s International Com- petitiveness Strategy. What problems does the Strategy tackle in the area of ICT? Our aim was to make the strategy as com- prehensive as possible and, considering the vital importance of ICT for raising the com- C Z E C H B U S I N E S S A N D T R A D E Svatoslav Novák

| 1 6| 1 6 I N F O R M A T I O N T E C H N O L O G Y Photo:ICTUniearchives petitiveness of the country, we wanted it to be a document covering all spheres of the economy. Part of the International Competitiveness Strategy are, among other things, the basic theses and goals of the “Digital Czech Republic” document. It emphasises the favourable influence of high-speed Internet and the importance of supporting it. An indispensable require- ment is the completion of the public ad- ministration electronisation projects and the creation of a demand for useful serv- ices to citizens and firms. How well are Czech enterprises equipped with information and communication technologies? Their equipment in these technologies dif- fers considerably by sector and often also by the size of the companies. Larger firms are, as a rule, better equipped, and as for the sectors, for example, financial institu- tions, telecommunication companies, and of course IT firms are better equipped. It is a well-known fact that domestic banks often use more modern and more sophis- ticated technologies than their foreign “parents”. According to your survey of November 2011, in the five-year horizon the com- petitiveness of the Czech economy will rest primarily on education and techno- logical development. What other findings were ascertained by the survey? The survey showed that only 13% of com- pany managers in the Czech Republic are satisfied with the situation prevailing in the electronisation of domestic public admin- istration, while nearly one-half, specifically 47%, of respondents are dissatisfied or very dissatisfied. According to more than one half of the managers, specifically 54%, the suspension of public administration elec- tronisation projects, mentioned occasional- ly in connection with budgetary cuts, would adversely affect the further development of the domestic economy. The problem of new investors wishing to invest in ICT services, just like that of firms established in the Czech Republic, however, is the long-lasting short supply of skilled ICT experts in the labour market. Why is this so? At the moment, Czech universities are un- able to fully meet the demand for fully- fledged experts. One of the reasons is the weak population age groups of people that have been enrolling in universities over the past few years, in addition to the long-last- ing gap between the requirements or needs of firms and the specific“profile”of university graduates. IT specialists in the Czech Repub- lic are often top experts who easily stand their ground even in the strictest interna- tional comparisons, but who have problems with communication and teamwork, and are often unable to present and“sell”the re- sults of their work. Can you perceive any strong trends influ- encing the IT sector? There are naturally many trends, but the most important of these is perhaps Cloud Computing. For the time being, however, the benefits, and maybe also the risks, of the“computing cloud”have not as yet been fully evaluated, and this is one of the reas- ons why ICT Unie is preparing a position document on “Cloud Computing in State Administration”. What kind of IT services are currently most in demand in the Czech market? IT services provided through the Internet are most frequented today, mainly thanks to Cloud Computing. The highly sophisticated analytical software area is also growing. What threats and opportunities can you see in the IT sector in the coming years? Naturally, the threat of a new economic recession is hovering over the world econ- omy, which also affects the situation and development in the area of ICT (not only) in the Czech Republic. Irrespective of this fact, our country must concentrate on in- novative solutions and the provision of services with high added value. We have all the potential needed, with a good supply of intelligent and capable people, and the In- ternational Competitiveness Strategy men- tioned above, the aim of which is to rank this country alongside the world’s 20 most competitive economies by the year 2020, is undoubtedly showing the right way. The task will be to follow that way in practice. How are Czech IT firms faring in foreign markets? Some are definitely faring well. Worth mentioning is the virtually global success of Czech security software manufactur- ers and the dynamic development of the firms, absolutely unknown until recently, which are currently opening their own subsidiaries in other countries. Anyway, we are lacking any State or Government strategy aimed at efficiently supporting such firms, i.e. at facilitating their foreign market penetration.

1 7 | C Z E C H B U S I N E S S A N D T R A D E Universities are admitting an increasing number of students for IT studies, and yet the demand for graduates in IT sec- tors threatens to exceed the supply in the coming years. According to research undertaken by the Information Tech- nologies Department of the Faculty of Informatics and Statistics at the Univer- sity of Economics in Prague (VŠE) and the Czech Society for Systems Integration (CSSI), there are about 220 000 IT spe- cialists working in the Czech Republic. Between 2006 and 2010, about 30 000 new university-educated staff joined the sector, but the universities supplied only 16 000 IT graduates to the labour market. The research has confirmed that companies seek graduates with a wide range of knowledge in the IT area, but at the same time emphasise the abilities of communication, teamwork, presenta- tion, and entrepreneurship. The results of About 220 000 IT Specialists Working in the Czech Republic 2011 also showed that the requirements of companies regarding the level of the graduates’ knowledge have decreased significantly (as compared with 2006). “In my opinion, the current lower require- ments of companies of new employees ITVirtualisation Benefiting Business According to research carried out by the VMware company in 2011, 93% of firms oper- ating in the Czech Republic regard IT virtualisation as a contribution benefiting their business. At least one-third of the respondents (from private companies and govern- ment institutions of all sizes) said they considered the possibility of having their IT hosted externally, and wished to respond actively to the starting trend of cloud com- puting. The research indicated the priorities of the companies, where the most impor- tant theme for 56% of them was the management and automation of IT infrastructure, followed by 41% of those who put greater emphasis on cost-saving. Both areas show two-fold increases compared with the results of a study from the preceding year, when the theme of management and automation was a priority for 26% of those questioned, and cost-saving for 23%. Further important themes for one-third of the respondents were recovery in case of an outage, and virtualisation of end-user stations. in the IT sector result from a sobering in the labour market, where firms have realised that their former requirements could not realistically be fulfilled”, says Jiří Voříšek, Head of the IT Department at VŠE and CSSI President. inzerce_185x128_final.indd 3 4.9.2006 10:08:24

| 1 8| 1 8 I N F O R M A T I O N T E C H N O L O G Y The Future of Czech IT Rests with Small Innovative Start-up Firms This year again, the Czech ICT Alliance is planning to organise a number of events at home and abroad, its main aim being the promotion of start-up firms with a good innovative poten- tial. Its plans for foreign events and cooperation with foreign institutions are very wide-ranging. A number of events in support of Czech ICT and the propagation of Czech ICT took place already in March. WITH OECD TO KAZAKHSTAN The first item on the programme is the expanding of collaboration with the pres- tigious international organisation, OECD, and the sharing of Czech know-how with governmental organisations and ministries in Kazakhstan, one of the Czech Republic’s leadingimporters.Inmid-March2012,Michal Zálešák, Executive Director of the Czech ICT Alliance, made a presentation at a closed seminar for representatives of Kazakhstan’s ministries on the support of innovations and technological firms. The seminar was a fol- low-up to previous consulting collaboration, the outcome of which is not only know-how transfer, but also an interesting opportu- nity to present Czech IT and the products of Czech firms to Kazakh government rep- resentatives. Kazakhstan is a country rich in mineral raw materials, with a good financial backing and excellent opportunities for the expansion of Czech IT firms. SUCCESS OF CZECH IT AT CEBIT This year again, Czech firms have been very successful at the CeBIT Fair. The Czech ICT Alliance not only had its stand there, but it also participated as a partner in the international competition of innovative projects, called The Seal of Excellence. Representatives of the Alliance, as mem- bers with voting rights, co-decided on what were the best solutions presented at CeBIT. We are very pleased that two Czech firms, INVEA-TECH and CÍGLER SOFTWARE, were given Silver Awards in the compe- tition. The Seal of Excellence, one of the prestigious European prizes, has been awarded since 2003. As in previous years, the Czech ICT Al- liance offered free participation in this prestigious European fair to innovative Czech firms which do not have sufficient resources to display their products at the fair. In the course of five days, several firms took their turn at presenting their products and services on the Czech stand to potential customers. These firms were also invited to use the meeting place in the ICT stand for bilateral talks. This al- lowed them to present themselves at the fair at a minimal cost, only having to pay their travelling expenses to Hannover in Ger many. Due to its success at this year’s CeBIT, we can now already say that next year the Czech ICT Alliance will again be able to participate in this prestigious event and offer innovative Czech firms the possibility of attending the Fair so as to promote themselves and be noticed. Another event we are planning for this year is a visit to Turkey, which, however, will have a broader coverage, taking in the en- tire Middle East area. There, too, we will offer Czech firms free participation on our stand. The Turkish CeBIT, named CeBIT Bilisim Eur- asia 2012, will be held in Istanbul from 29 November to 2 December. USA – EXAMPLE OF SUCCESSFUL COOPERATION WITH CZECH DIPLOMATIC MISSIONS The Czech Embassy in Washington and the Consulate General in New York are very ac- tive in supporting Czech IT. This year, we are planning two events in conjunction with these two diplomatic offices. These will be concerned with collaboration at the public- private-partnership level. The Alliance will participate in both events financially, while the organisation will be sponsored by the two diplomatic missions. Photo:Rapidarchives ABOUT THE CZECH ICT ALLIANCE The Czech ICT Alliance is an official export alliance for ICT of the CzechTrade Governmental Agency. With its 120 members, the Alliance is one of the largest alliances of its type. In the Czech Republic, it collaborates actively with CzechInvest Agency and realises several projects supported by the The Ministry of Labour and Social Affairs and the Ministry of Education.

1 9 | C Z E C H B U S I N E S S A N D T R A D E The first event will be the Czech IT Inno- vation Day in New York, where about 10 selected innovative firms will present their technological products to potential US partners. The CzechInvest Agency will also participate in the organisation of the event. As part of the event, a visit will be arranged to the prestigious American technological accelerator – a very interesting functional model, where firms, supported by experi- enced mentors, will be taught how to start a business in not more than three months. The other event will be XChange 2012 (http://www.xchange-events.com/xch_12), to be held in Texas in August. It will be a closed B2B event, to which the organisers will invite managers of American technolog- ical companies and Czech companies will present their products and services to them, on our stand.The business aim is not to gain the final customer, for example a bank, but to create a strategic partnership with sys- tem integrators. The integrators will then become the subjects of business contracts, under which interesting Czech technologi- cal products will be offered. Thanks to the Czech ICT Alliance, Czech firms will be given an opportunity to display their products and services on the stand, will obtain expensive tickets free of charge and will only have to pay their travelling expenses. ACTIVITIES IN THE CR IN SUPPORT OF INNOVATIONS In the Czech Republic, the Alliance’s priority will be putting pressure to bear on raising the export efficiency of Czech IT firms. In support of this aim, the Alliance has created a training budget, from which primarily the training of the Alliance’s member firms in export skills will be financed. The purpose of the training will be to teach these firms how best to stand their ground in foreign markets and how to take better advantage of visiting trade fairs. The Czech ICT Alliance is holding talks with several prestigious international tech- nological accelerators. The accelerator idea is an interesting project intended, with the help of experienced mentors, to assist start-up firms to get their businesses run- ning within a matter of three months. Cur- rently we have a network of 20 experienced mentors with international experience and a network of regional partners from among higher learning institutions (Mining Uni- versity, Czech Technical University, Palacký University Olomouc) and well-functioning technological centres (Technological Cen- tre Hradec Králové, TIC Zlín, etc.). The aim of the project will be to identify potential promising projects arising in universities, increase their potential and start develop- ment within three months, as well as to link them with experienced foreign partners for international expansion. More about the Czech ICT Alliance at www.czechict.cz Last year Czech ICT Alliance cooperated with CzechTrade Agency in the framework of the DHL UNICREDIT Export Prize. Jointly, their representatives announced a competition and awarded a Special CzechTrade Export Innovation Prize. The winner was the company BORCAD. FOR BANKS, CREDIT UNIONS, BUILDING SAVINGS, PENSION SAVINGS, CREDIT PROVIDERS I N F O R M A T I O N S Y S T E M S www.turboconsult.cz/en We are respected and well-established developer andsupplierofprovenICTsolutionsforthebanking and finance industry. Our offer includes: Core banking systems Management of repayment products Administration of deposit products Payment transactions Internet banking Support of sales network Anti-Money-Laundering solution Compatibility with Euro currency Make use of our specialization, know-how and international experience! TurboConsult s.r.o. Botanická 56, 602 00, Brno, Czech Republic Tel.: +420 532 161 111 | Fax: +420 532 161 209 E-mail: TC_sales@turboconsult.cz inzerce_185_128.indd 1 9.1.2012 11:46:42

| 2 0 Mostarez MOSTAREZ joint stock company A provider of turn-key solutions for constructed and technological facilities and reconstructions of re- fineries, chemical plants, nuclear power plants, breweries, dairies, incineration plants, sewage treatment plants, residential buildings, hotels, business centres, etc. MOSTAREZ joint stock company and its affiliated firms ensure the complete fulfilment of all kinds of the work connected with construction in the Russian Federation. 1 l Consultations, legal and technical assistance 2 l Providing a building site on behalf of the customer – building owner 3 l Designing on behalf of the delineator, making an expert report of a project, getting the permission to construct 4 l Turnkey construction on behalf of the customer 5 l Commissioning of a facility on behalf of the customer MOSTAREZ a.s. | Křivého 13, 612 00 Brno, Czech Republic Phone: +420 737 157 231 | E-mail: mostarez@seznam.cz | www.mostarez.eu

2 1 |2 1 | C Z E C H B U S I N E S S A N D T R A D E The Czech Republic Is a Country with Highly Open Energy Industry The year 2012 will be extremely im- portant for the Czech energy sector. In the middle of the year, the Ministry of Industry andTrade is to submit a draft new State Energy Concept, which is to set out guidelines for the mix of energy sources for several decades.What, then, is the present state of the sector? Thanks to its energy mix, the Czech Republic is one of the least dependent countries on the import of energy sources in the EU 27. A great part of its energy production comes from its own reserves of solid fuels (primarily black coal, some of which is also exported), and the production of nuclear power plants. Owing to its own solid fuel reserves, the Czech Republic imports only oil and natu- ral gas, and depends heavily on these sup- plies. Thus, the principal sources of electric energy are nuclear power plants, coal-fired power stations, heating plants, large hydro- electric stations, and factory power gener- ating units. This mix is supplemented with renewable sources, especially wind and photovoltaic power plants, and sources burning biomass and biogas. In the recent years, the highest increase occurred in the area of photovoltaic sources. Due to the ex- isting system of support and the price of the technology, almost 2 GW were installed in these sources in 2009 and 2010. In addition, last year the Czech Republic exported the largest amount of electricity ever. Accord- ing to preliminary data, last year’s export exceeded 17 terawatt-hours (TWh), 1.2 TWh more than the former record from the years 2003 and 2007. The companies actually pro- duced even more electricity for export be- cause the estimated quantity of 17 TWh is the difference between export and import. The current figures confirm the Czech Re- public’s position as one of the largest Euro- pean and world exporters of electric energy. The largest buyers of Czech electricity were Austria, Germany, and Slovakia. MARKET REGULATION The electric energy market on Czech ter- ritory operates on the basis of regulated access to the transmission grid, the distri- bution networks, the possibilities of the construction of electricity generating facili- ties and direct lines. The prices of electricity transmission and distribution, the system services, electricity prices for protected cus- tomers, and electricity prices from suppliers are regulated by an independent regulator of the energy market – the Energy Regula- tory Office (ERO). Its competence is to sup- port economic competition and to protect the interests of consumers in those areas of the energy sector where competition is not possible, with the aim to satisfy all adequate requirements for energy supply.The ERO de- cides on the granting, change or withdrawal of a licence, and price regulation according to special legal rules. LARGEST MARKET PLAYERS Electricity generation on Czech territory is ensured especially by the joint-stock company ČEZ (about 75%) and more than a hundred independent producers. Besides fossil-fuelled thermal power plants, elec- tricity is generated on Czech territory by the nuclear power stations of Temelín and Dukovany, by hydroelectric, solar, and wind power plants, as well as those burning bio- mass. Considerable debate is now taking place on the completion of the Temelín nuclear power plant, which is to be the big- gest tender in Czech history, with the largest world suppliers of nuclear technology ten- dering. In March of last year, documentation was presented by ČEZ energy company to the entities which qualified for the tender process of the public contract (these were jointly Westinghouse Electric Company LLC and Westinghouse Electric Company Czech Republic, s.r.o.; the association ŠKODA JS a.s. and JSC Atomstroyexport and JSC OKB Gidropress; AREVA NP S.A.S.). The deadline for submitting bids is 2 July 2012, the win- ning bidder is expected to be announced and the contract ought to be signed in late 2013. CZECH REPUBLIC’S ENERGY MIX SHOULD BE BALANCED According to the Czech Gas Union, the State Energy Concept should be environmentally friendly, based on energy conservation, CZECHS TO SUPPLY ENERGY SOURCE FOR 2014 WINTER OLYMPIC GAMES One of the strategic facilities for the success of the 2014Winter Olympic Games in Sochi, Russia, will be a new combined cycle power plant. It will be supplied for the investor, GAZENERGOSTROY, by the company Královopolská RIA of Brno.The project is to be worth EUR 385 million. A preliminary contract for the new source was signed during the visit of Russian President Medvedev to the Czech Republic in December 2011.The combined cycle power plant, with a capacity of 366 MW, to be fitted by the Brno producer with 20 engines from a Finnish supplier, will be sited in the Kudepste area. Photo:ČEZcompanyarchives

| 2 2 E N E R G Y a balanced mix of energy fuel sources, and on competition between energies. The updated energy concept should also aim particularly at a highly effective utilisation of energy inputs. “In contrast to other fossil fuels, natural gas supplies are increasing and thus, it is necessary for some recommenda- tions in the State Energy Concept, which is now under preparation, not to be in con- flict with the open energy market and not to restrict competition in the fuels market“, Oldřich Petržilka, President of the Czech Gas Union, says. “By its low share of natural gas, the composition of the Czech Republic’s pri- mary energy sources differs significantly not only from developed countries, but even from the world average. The present share of natural gas in this country is 18%, and it should rise to at least 23% in the medium term“, Oldřich Petržilka added in his address at the 127th Žofín Forum in Prague in early February 2012, which focused on the future of the energy industry in the Czech Republic. “Typically nowadays, nuclear power plants Quality is our success Babcock Borsig Steinmüller CZ s.r.o. is an important producer of steam generators and power plant equipment. Our pro- ducts generate thermal and electrical power while using environmental friendly technologies. We provide compre- hensive solutions for applications using a wide range of fuels and/or waste heat utilization. Our scope of works and ser- vices extend from the technical feasibility study up to the final site installation, putting the plants into operation and lifetime services. Babcock Borsig Steinmüller CZ s.r.o. -øK ªMQXC    $TPQ %\GEJ 4GRWDNKE www.bbs-cz.bilfinger.com ELECTRICITY PRODUCTION IN THE CR According to the Czech Statistical Office, electric power generation totalled 87 561 GWh in the Czech Republic in 2011, with steam power plants accounting for 57.1%, nuclear power stations for 32.3%, combined cycle and fuel fired power plants for 4.5%, and hydro power plants for 3.2%. In comparison with 2010, total electricity production increased by 1.9%. Energy sources in 2011 were coal with 53.4%, nuclear fuel with 32.3%, hydro power with 3.2%, and biomass burning provided 1.9% of all electricity, of which 44% was from forest biomass, 36% from waste biomass, and 20% was accounted for by biomass grown for this purpose. Natural gas burning produced 1.2%, and the burning of other gases (exclusive of landfill gas and biogas) provided 3.7% of electric power. Landfill gas and biogas burning generated 1.0%, and 0.5% of energy was obtained from wind power plants in the Czech Republic in 2011. Solar energy accounted for 2.4% of electricity generation (0.7% in 2010). The great year-on-year fluctuations in electricity production by hydro power plants are directly linked with the hydrological situation in the different years. have an even output and the growing need for a flexible balancing generation can be satisfied precisely by gas-fired power plants and gas-fuelled co-generation sources.“ REGULATION OF COSTS IN SUPPORT OF ENERGY FROM RENEWABLE SOURCES Debate is now taking place in the Czech Republic on renewable energy sources, par- ticularly on photovoltaic power plants. Elec- tricity production from photovoltaic power plants rose steeply last year, by the end of last October solar power plants produced 2012 gigawatt hours of electricity, which was more than three times the annual out- put of 2011. The steep growth was due to the advantageous state subsidies which at- tracted a considerable number of investors to the solar sector in 2010. The number of solar power plants rose quickly and their installed capacity increased last year more than four times approximately to 2000 MW. During last year, the growth of the installed capacity of photovoltaic sources slowed down markedly because of the stricter con- ditions for the operation of these power plants, as their support is actually reflected in higher electricity prices. The Renewable Energy Sources Act (see p. 24), to be prob- ably in effect in the Czech Republic from next year, will regulate and reduce the ex- penditure on incentives for energy produc- tion from renewable sources.

inzerce Steel structures Lay-out design and basic design Research and development in the field of natural, technical, and social sciences Technical advisory in the field of engineering, metallurgy, and power industry Specialised merchandizing Entrepreneurial, financial, organizational, and economical advisory Business handling Electrical equipment designing Project management of machines and equipment production Construction building-up, redesigning, and removing Project management Engineering of simple constructions, their redesigning, and removing SYSTEM ACCURACY RELIABILITY Company Seat NOEN, a.s. Vaclavske namesti 56 110 00 Prague 1 Tel.: +420 224 032 510 Fax: +420 224 032 513 Branch Unicov NOEN, a.s. Litovelska 1375 783 91 Unicov Tel.: +420 585 080 650 Fax: +420 585 080 699 Branch Chrudim NOEN, a.s. Tovarni 1112 537 01 Chrudim Tel.: +420 469 623 163 Fax: +420 469 623 191 Branch Bilina NOEN, a.s. 5. kvetna 213 418 01 Bilina Tel.: +420 724 859 913

| 2 4 E N E R G Y ENERGY SOURCES Renewable sources are in particular the energy of wind, energy of solar radiation, geothermal energy, energy of water, energy of soil, energy of air, and energy of biomass. Besides support for these sources, also secondary and combined energy sources will be newly supported. Secondary sources are those the energy potential of which originates as a by-product in the transformation and final consumption of energy, and for example in the release of mine gases or in waste removal. A combined source is a source transforming primary energy into electrical energy and useful heat in a combined process running concurrently on one production facility. Energy Law in Process of Change In February 2011, the Parliament of the Czech Republic approved the Supported Energy Sources Act, which simultaneously abolishes and re- places the former Act No. 180/2005 Coll., as amended, on incentives for electricity production from renewable energy sources. Besides harmonisation with the European legislation, the law is also aimed at reducing the costs of support for renewable energy production and reducing the operational costs of the electrical power system. On the one hand, the Act is thus to meet the target of a 13.5% share of green energy in energyconsumptionintheCzechRepublicby 2020, and on the other hand it seeks to slow down the uncontrolled growth of part of the renewable sources (mainly solar power plants and biogas stations). Most of its provisions are to come into effect on 1 January 2013. Unlike the previous Act on Renewable En- ergy Sources, the new law brings principal changes in several areas - particularly it con- centrates support for renewables, second- ary sources, and high-efficiency combined production of heat and electricity in a single legislative regulation, replaces the existing model of energy support with a new model of energy support, supports also heat from renewable and secondary sources, lays down the duties for the preparation of the National Renewable Energy Action Plan (see box 2) and its use as an instrument for the regulation of support and the further devel- opment of renewable sources. RESTRICTION OF SOLAR BOOM The Act sets out the conditions of support for the different energy sources. Electricity generating facilities must be connected to theCzechRepublic’selectricalpowersystem directly or through a delivery point or an- other power generating facility. A minimum efficiency of energy use is set out for certain renewables and for secondary sources. After the solar boom of the last few years in the Czech Republic, the government wants to prevent their further construction. The new law allows only the construction of small installations with a capacity of up to 30 kWp on roof structures or outside walls of ground-mounted buildings with solid foun- dations, and simultaneously sets the limit of CZK 4 500 per megawatt hour of generated electricity. The regulation also provides for a withholding tax on solar power stations (payments on electricity from solar radiation produced in the years 2011-2013 in facilities put into operation in the years 2009-10 will amount to 26% of the feed-in tariff, or 28% of the Green Bonus, electricity from units up to 30 kW on buildings will be exempt). The producer is liable for the payment. In the case of payment in the form of the Green Bonus for electricity, the payer is the market operator, and in the case of payment in the form of feed-in tariff, the liable entity is the purchaser. OPTIMISATION OF EXISTING SYSTEM The new model of support is based on the optimisation of the existing system and the introduction of a market element in the sys- tem. Electricity support takes the forms of a Green Bonus on electricity or feed-in tariffs. The extent and amount of electricity sup- port is set out by the Energy Regulatory Of- fice in its price decision. Small hydro-power stations can be satisfied because their fixed feed-in tariffs will be maintained also in the coming years, while in other kinds of renew- able sources they can be used only by the smallest producers with a capacity of up to 100 kilowatt (then electricity producers are entitled to support in the form of the elec- tricity Green Bonus). The Green Bonus, i.e. a financial amount in support of electricity production, must be paid to the producer by the market operator, on the basis of the metered or calculated electricity output. Electricity producers are entitled to change the form of electricity support only as of 1 January of the particular year. Photo:www.sxc.hu

inzerce WWW.KOVOSVIT.COM Machine Tools World We machine with five axes! KOVOSVIT MAS, a.s. ƒ Vertical machining centers ƒ Five-axis vertical machining centers ƒ Gantry machining centers ƒ Horizontal Machining Centers ƒ Multioperational turning-milling centers ƒ CNC lathes ƒ Turning machining centers ƒ Universal center lathes with CNC system ƒ Special technologies ƒ Palletization and robotization of machines ƒ Customer support ‚ Design of machines and technologies according to drawings ‚ Special job-order production of parts ‚ General overhaul and repair of MAS machines ‚ Special training for adjustment of machines MULTICUT 500 - Multioperational turning-milling centers ƒ Max. turning dia.: 690 mm ƒ Max. turning lenght: 1500, 3000 mm ƒ Spindle drive output: 74 kW MCU 630VT-5X - Multioperational five-axis vertical machining centers ƒ Table clamping surface - dia.: 630 / 800 mm ƒ Max. table load: 850 kg ƒ Spindle drive output: 35 kW

| 2 6 S E R V I C E S Photo:ČEZCompanyarchives STRENGTHENED ROLE OF ENERGY REGULATORY OFFICE In a calendar year, the Energy Regulatory Of- fice sets the feed-in tariffs for the next calen- dar year separately for the different kinds of renewable sources, or for groups by the size of installed capacities of electricity producers. Then, in a calendar year, the Office sets the amount of an annual Green Bonus on elec- tricity and the procedure for the determina- tion of an hourly Green Bonus on electricity for the next calendar year, in such a way as to ensure the amount of the annual Green Bonus on electricity to compensate at least for the difference between the feed-in tar- iff and the expected average annual hourly price for the particular kind of energy source, and the amount of the hourly Green Bonus on electricity to compensate at least for the difference between the feed-in tariff and the achieved hourly price for the particular kind of renewable source. SUPPORT FOR HEAT FROM RENEWABLE SOURCES Besideselectricity,theActalsosetsouttherules of support for heat from renewable sources. It takes either the form of heat investment sup- port (as a Green Bonus paid by the market op- erator) or of heat operational support (through support programmes from state or European financial resources or money from the sale of greenhouse gas emission allowances).The law will not support additional biogas stations that would operate only on the basis of targeted plant growing – at least 30% of the fuel must originate as farming waste. Stricter rules will apply to the co-firing of biomass with coal. Biomethane, i.e. treated biogas comparable by its quality and purity with natural gas, and whichisconsideredasnaturalgaswhenenter- ing the transmission and distribution systems, will receive support under the Act (provided it is produced on the territory of the Czech Republic). Biomethane support will have the form of a Green Bonus on biomethane pay- able by the market operator. LIQUIDATION OF HAZARDOUS WASTE The Act brings changes also in the area of waste connected with the liquidation of so- lar panels. The adopted concept is based on the necessity to set the rules for the future handling of waste solar panels from solar power plants and to ensure sufficient finan- cial amounts for the liquidation of hazardous waste from solar panels after their service life ends or a solar power plant is closed down. The producers of solar panels will be required to finance the separate collection, process- ing, use, and removal of solar panels intro- duced to the market after 1 January 2014. For solar panels introduced to the market before 1 January 2014, the financing of the collec- tion, processing, use, and removal of electri- cal waste from solar panels will be provided by the solar power plant operators. Note: In mid-March this year, the norm was returned by president Václav Klaus to the Chamber of Deputies for revision, but the presidential veto will probably be overridden there. Marie Brejchová President of the Union of Company Lawyers Head of the Legal Section of Pražská energetika (PRE) NATIONAL ACTION PLAN FOR RENEWABLE SOURCES The form and structure of the submitted National Action Plan of the Czech Republic, as prepared by the Ministry of Industry and Trade for energy from renewable sources, are based on the requirement of the Commission Decision 2009/548/EC of 30 June 2009, which establishes a template for National Renewable Energy Action Plans under Directive 2009/28/EC of the European Parliament and of the Council. The form of the document is mandatory in order to allow comparison of the action plans and the proposed amounts between member states. The draft National Renewable Energy Action Plan of the Czech Republic (hereinafter Action Plan) proposes the target of a 13.5 % share of energy from renewable sources in final energy consumption and the target of a 10.8 % share of renewable energy sources in final consumption in transport. The proposed Action Plan is prepared in such a way as to fulfil the required goals in the area of the utilisation of energy from renewable sources, on the basis of current and prepared real projects and of the expected real prediction of future development based on the statistical monitoring of trends, while taking into account support policies where applicable. In the case of the photovoltaic systems and wind power plants, the requirement for the prepared projects is confronted with the security and reliability of the electrical power system. The Action Plan will be regularly updated and amended.

inzerce TÜV SÜD Czech s.r.o. • Novodvorská 994 • 142 21 Praha 4 e-mail: info@tuv-sud.cz • tel: 844 888 783 What companies must now do to save energy and money ISO 50001 replaces EN 16001 On 24 April 2012, the German stan- dards institute DIN will withdraw the EN 16001:2009 European standard and replace it with the international ISO 50001:2011 standard. The energy ma- nagement experts at TÜV SÜD explain important points to note for organiz- ations which intend to change their certificates or are currently undergo- ing EN 16001 certification. TÜV SÜD Management Service GmbH was one of the first certification companies to gainDAkkSaccreditationforthecertifi- cation of energy management systems in accordance with the ISO 50001:2011 standard. An EnMS is the critical factor for a company in achieving systematic, integrated and sustainable reduction of its energy consumption. Within the scope of establishing an energy ma- nagement system, organizations need to develop and implement sustainable organizational and operational pro- cedures. TÜV SÜD supports compa- nies in the successful implementation of energy management systems. The national accreditation body for Ger- many, DAkkS, published a transitional re- gulation for companies already certified in accordance with the EN 16001 standard by an accredited certification body. Under this regulation, certificates can be chan- ged over to ISO 50001 up to 24 April 2013 provided the organization complies with the changed requirements for energy ma- nagement systems (EnMS) set forth in the new standard. „As the ISO 50001 standard largely corresponds with the EN 16001 standard, the additional requirements keep within reasonable limits. One new requirement concerns energy purchasing specifications“, explains Klaus-Dieter Fürsch, Product Manager EnMS at TÜV SÜD Management Service GmbH. Fürsch continues: „We recommend that organiz- ations currently on the point of recei- ving EN 16001 certification aim directly at certification in accordance with ISO 50001 if possible“. Basically, the costs and efforts involved in certification in accordance with the ISO 50001 standard are the same as for the old standard. However, the changeover of an existing certificate or certification procedure causes additional costs. For existing certificates, an upgrade may be possible within the scope of a regular surveillance audit. No changes regarding EEG re-allocation charges For companies planning to apply at the German Office of Economics and Export Control (Bundesamt für Wirtschaft und Ausfuhrkontrolle, BAFA) for a cap of re- allocation charges in accordance with Art. 40 of Germany‘s Renewable Energy Act (EEG) 2012 and that must furnish eviden- ce of a certified energy management sys- tem, there will be no changes for the time being. In its updated “Certification Leaflet“ (II A 1. Sub-leaflet) BAFA explains that it will recognize all EN 16001 certificates and audits in its application procedure and that certificates need not be changed over to ISO 50001:2011. The application for 2013 must be filed by 30 June 2012. Continuous improvement of energy per- formance The processes of the ISO 50001 standards aim at significantly reducing energy con- sumption in companies, thus saving costs and cutting greenhouse gas emissions and other environmental pollution. The stan- dard is suitable for integration into other management systems including ISO 9001 or ISO 14001. Central element of the ISO 50001 standard is the continuous improvement of an organization‘s energy performance. The standard describes the requirements that organizations must fulfil to establish, implement, maintain, and improve an EnMS. The key advantage for organizations is that an EnMS and its impartial monito- ring process facilitate the identification of potential areas for energy saving. TÜV SÜD Industrie Service GmbH assists companies with EnMS implementation. Depending on the sector of industry and the system in question, the introduction of an EnMS may cut the energy consumption of a company by as much as 20 per cent. In addition to these savings there are tax benefits and lower re-allocation charges. TÜV SÜD Management Service GmbH offers the certification of energy manage- ment systems, enabling organizations to furnish evidence that they maintain an efficient management instrument to ensure energy-efficient and sustainable oper- ation. TÜV SÜD Akademie is a recognized initial and further training expert, offering numerous training courses on this subject. Further information about TÜV SÜD is avail- able at www.tuv-sud.cz

| 2 8 Stricter Conditions for Starting Insolvency Proceedings On1January2012,theAmendmentofSection 98Paragraph1oftheInsolvencyActcameinto force, which regulates the debtor’s obligation tofilea petitionforhis/herowninsolvency.The “anti-crisis” Insolvency Act Amendment (No. 217/2009Coll.)providesfornarrowingdownof thedebtor’sobligationtofileaninsolvencype- titiontoa situationwherethedebtorisinbank- ruptcyintheformofinsolvency.Theobligation to file an insolvency petition also in the case of bankruptcy in the form of excessive indebted- ness was only limited to entities in liquidation. That restriction was temporary and ended by the end of 2011. From the beginning of 2012, the debtor, whether a legal or a natural person – a businessman – is obliged to file a petition for his/her insolvency without undue delay af- ter he/she has learned, or should have learned by exercising due diligence, about his/her bankruptcy. This procedure must be followed, regardless of whether it is a case of bankruptcy having the form of insolvency or the form of excessive indebtedness. The Czech Republic Has the World’s Third Best Nuclear Safety Rating The Czech Republic holds third place in the world among 32 countries in terms of nuclear materials’ safety and safeguarding. The list of countries possessing or using nuclear materi- als was drawn up by the American non-gov- ernment organisation, NuclearThreat Initiative (NTI). The list is topped by Australia, followed byHungaryandtheCzechRepublic,withSwit- zerland ranking fourth and Austria fifth. The list is based on a large number of indicators, including the physical safeguarding of nuclear material, its volume, number of facilities, the sites where nuclear material is kept, the politi- cal stability of the country concerned and, not lastly, its transparency and corruption rate.The Czech Republic was included in a group of nine states with the best rating, which gained at least 80 points out of the possible 100 – and obtained the highest number of points for the control and safeguarding of nuclear material, and also the related legislation. K A L E I D O S C O P E CREA Hydro&Energy Cluster Enters a New Stage of Cooperation In February 2012, the CREA Hydro&Energy Cluster completed its first joint project for the promotion of competitiveness of Czech firms operatinginthefieldoftechnologiesandserv- ices for water and waste management and renewable energy sources utilisation. Within the framework of the project, the Cluster has devised new methods for raising the safety of dams, sediment removal and waste liquida- tion, and innovated types of turbines for small hydro-electric power stations. Its most impor- tant foreign achievement has been the send- ing of Czech experts and the export of Czech technologies and equipment for the construc- tion of dams in Northern Iraq. The approval of registration under the OPPI Cluster Cooperation Programme started a new stage of CREA’s cooperation aimed at the ex- pansion and internationalisation of the Cluster, in addition to research. This new stage was Photo:CREAHydro&Energyarchives Active Role of ICC Czech Republic The International Chamber of Commerce (ICC) today represents thousands of compa- nies and associations from more than 120 countries. The mission of the ICC National Committee in the Czech Republic is to assist Czech enterprises and other companies to become integrated into world affairs through this prestigious international organisation. ICC CR provides a wide range of services of essential importance for carrying out foreign business, such as educational and consulting services, and creating opportunities for starting partnerships with foreign trading companies. ICC’s other activities include the sponsoring of various events, seminars and conferences organised by ICC Czech Republic. In the first quarter of 2012, for example, these activities included a conference entitled Economic and Financial Crisis – Outlook for Czech Businessmen; a club evening on Developmental Assistance as a Path to New Markets; a territorial meeting featuring Kazakhstan and Armenia, and seminars for companies on the subject of international trade. More about current events at www.icc-cr.cz/. markedbytheCluster’sjoiningtheinternational energy metacluster. In Southeast Asia, a coop- eration agreement was signed with a strategic partner,theprestigiousPhilippinefirm,Sta.Clara International Corporation. The agreement was signed in Manila by Břetislav Skácel, Chairman of the Cluster, and his counterpart, Nicandro G. Linao,inthepresenceofCzechForeignMinister Karel Schwarzenberg, the Czech Ambassador Josef Rychtar and the Philippine Ambassadress, EvelynAstria-Gardia,atatimewhentheCluster’s fourth project to be realised in the Philippines is being completed. (see picture).

2 9 | EUROPEAN UNIONEUROPEAN UNION EUROPEAN REGIONAL DEVELOPMENT FUNDEUROPEAN REGIONAL DEVELOPMENT FUND INVESTMENT IN YOUR FUTUREINVESTMENT IN YOUR FUTURE EUROPEAN UNION EUROPEAN REGIONAL DEVELOPMENT FUND INVESTMENT IN YOUR FUTURE CREA Hydro & Energy, o.s. Traubova 6 • 602 00 Brno • Czech Republic e-mail: crea@creacz.com www.creacz.com Profile of the Association CREA Hydro&Energy, o.s. CREA Hydro&Energy, o.s. is a cluster of companies, research institutes, and universities operating in the branch of technologies for hydraulic structures, water and waste management and renewable energy resources. The members of the Cluster jointly participate in the development and innovations of products, in the promotion of the branch, and in the presentation and implementation of projects in the Czech Republic as well as all over the world. CREA Hydro&Energy, o.s. cooperates with large Czech and multinational companies and applies the most advanced technologies and know-how in the branch and participates in its creation and transfer within international cooperation. It is a partner of the Ministry of Foreign Affairs of the Czech Republic in the Aid forTrade programme and in the projects of foreign development cooperation. Its members work in interna- tional associations, such as ICOLD (International Commission on Large Dams), ESHA (European Small Hydropower Association), etc. CREA Hydro&Energy, o.s. provides Research, Consulting, Surveys, Design, Engineering, Manufacturing, Supply, Installation, Testing, Training, Special Services, etc. in the branch of: Water Structures (Dams, Pumping Stations, Water Resources, Hydropower Plants, Water Treatment Plants, Water Supply, etc.) Waste Management (Landfills, Waste Water Treatment, Waste to Energy, etc.) Renewable Energy (Small Hydro, Wind, Solar, Biogas). Foundation Members of the Cluster: G AQUAPROCONs.r.o.G AQUASvodnídílas.r.o.G CzechHydrometeorologicalInstituteG GEOtest,a.s.G HGpartners.r.o.G AW-DAD,s.r.o. G MATOUŠEK CZ a.s. G Mendel University in Brno G PS PROFI s.r.o. G SIGMAINVEST spol. s r.o. G Strojírny Brno, a.s. G Sun Drive, s.r.o. G URGA, s.r.o. G VODNÍ DÍLA - TBD a.s. G Brno University of Technology C Z E C H B U S I N E S S A N D T R A D E

| 3 0 R E G I O N The Region of Central Bohemia is a distinctive region located in the very centre of Europe. Its size, number of municipalities and population make it one of the larg- est regions in the Czech Republic. The Region’s 11 015 sq. km take up almost 14% of the land area of the Czech Republic, and it is about 1.9 times larger than the average region in the Czech Republic. The Region completely envelopes the capital, Prague, and has borders with nearly all other Czech regions except the Region of Karlovy Vary and the Moravian regions. Region of Central Bohemia – Good Address for Quality Investments Liberec Praha České Budějovice Jihlava Brno Zlín Ostrava Olomouc Pardubice Hradec Králové Ústí n/L Karlovy Vary Plzeň SLOVAKIA POLAND AUSTRIA GERMANY Praha Benešov Příbram Beroun Rakovník Kladno Mělník Kutná Hora Mladá Boleslav Nymburk Kolín The location of the Region of Central Bohe- mia has a significant impact on the Region’s economic character. Close ties with the capi- tal and the dense transport network make the location of the Region extremely advan- tageous.The Regionisanimportantsourceof workforce for Prague, it supplements Prague’s industries,suppliesPraguewithfoodandpro- vides it with recreation potential. Aside from Prague, the Region of Central Bohemia has the densest transport network in the Czech Republic; it is also the most overloaded one. The historical radial layout of main rail and road transit networks crosses the Region’s ter- ritory to the capital. There is also water trans- port in the Region. The only waterway in the Czech Republic that is currently available for both domestic and international transport is the Labe-Vltava Waterway, three quarters of which flows through the Region’s territory. The Region is divided into 12 Districts with 10 districttowns.Thelargestinareaisthe District of Příbram (15% of the Region’s area), and the smallest is Praha-západ (5% of the Region’s area). There were 1145 municipalities in the Region in 2010. The highest number of mu- nicipalities is concentrated in the District of Příbram (121 municipalities), and the smallest number is in the District of Mělník (69 munici- palities). There are 82 statutory towns. When it comes to economy, the Region of Central Bohemia is one of the most impor- tant regions of the Czech Republic.The gross domestic product per capita in the Region of Central Bohemia in 2010 was 89.9% of the average per capita gross domestic product in the Czech Republic, which put the Region in third place when compared to other re- gions. The Region is the place of business for a number of important enterprises, and it offers a wide range of investment oppor- tunities. The Region’s long-term priorities include support for investments in perspec- tive fields, services a with high added value, science, and research. Support is provided forprojectsaimedatrevitalisingbrownfields. Several top projects for science/research centres are being prepared in the Region, including the ELI international laser centre, Biotechnology and Biomedicine Centre of the Academy of Sciences and Charles Uni- versity in Vestec (BIOCEV) and the SUSEN centre. The Region of Central Bohemia is a good address for ambitious investments and fields with a high added value. ECONOMIC SITUATION The Region of Central Bohemia is character- istic for its developed agricultural and indus- trial productions. Agricultural production benefits from the excellent natu ral condi- tions of the Region’s north-eastern part. The Photo:VodochodyAirportarchives,CzechTourismarchives Statistical Data Population 30th Sept. 2011 1 276 550 Gross wage 1 - 3 Q. 2011 CZK 23 478 (approx. EUR 935 ) Unemployment 31st Jan 2012 7.44% Source: Czech Statistical Office Even though Točník Castle is one of the youngest Czech castles, it is one of the largest

3 1 | C Z E C H B U S I N E S S A N D T R A D E Region is especially successful in plant pro- duction, including the growing of wheat, barley, sugar beet, and, in suburban areas, growing of fruit, vegetables, and flowers. Piv- otal industries are machine building, chemi- cal, and food-processing. Besides traditional fields, new and demanding fields and serv- ices are being successfully developed. In 2010, the majority of economic activity by entities with a place of business located in the Region involved wholesale, retail and services related to repairs and maintenance of motor vehicles (25.1%). The second and third most common business activity were building and industry. During the past year, 3.0% new entities that do business in the building industry appeared in the Region. The year-on-year increase of entities with industrial activities was 2.2%. There were 26 (see Table on page 34) active enterprises on file with 1000 or more employees with a place of business in the Region of Cen- tral Bohemia. The biggest employer in the Region is ŠKODA AUTO, a. s. The intensity of economic activities is heavily influenced by the Region’s location and easy access to main transport corridors. In the Region of Central Bohemia, this is especially true for places in the vicinity of the capital with connections to main roads, preferably the highways. The number of economic entities in these areas is high, even per capita. This is the case for municipalities in the vicin- ity of or with a good connection to the D1 highway (the southern part of the Praha-vý- chod /Prague-East District, the central and north-eastern parts of the Benešov District), D5 highway (Praha-západ/Prague-West Dis- trict, Beroun District), D8 highway (northern part of the Praha-východ and Praha-západ Districts, southern and northern parts of the Mělník District), D11 highway (Praha-východ District, western and southern parts of the Nymburk District) and other main roads (the surroundings of Mladá Boleslav, southern part of the Praha-západ District, northern part of the Příbram District). INDUSTRY Revenues from sales of own products and services in businesses with 100 or more employees and a place of business in the Region started to grow in 2010 after the slump of 2008 and 2009. Compared to 2009, the increase amounted to 11.1%, and the current value is CZK 483 billion for the whole Region. Revenues from direct ex- ports contributed 57.6% to this amount. There were almost 91 thousand employees in Central Bohemia industrial enterprises with 100 or more employees in 2010, and the average monthly wage amounted to CZK 28 539. The average nominal wage of industrial employees has grown by CZK 7 thousand since 2005. INVESTMENT ZONES The great economic boom at the end of the last century brought, among other things, the establishment of a number of invest- ment zones. There are over 115 registered zones in the Region today. One of the most important ones is the Kolín-Ovčáry Indus- trial Zone, which is home to, besides other enterprises, the Toyota Peugeot Citroën Automobile Czech car maker. Many invest- ment zones benefit from favourable loca- tions near international highways and main roads. These zones include, for example, the industrial zones of Průhonice, Čestlice- Nupaky (both near D1, which connects Prague and Brno), Rudná-Nučice (near D5, which goes from Prague through Plzeň to Germany) or Hostivice-Jeneč and Tuchlov- ice. Many zones were established in the vi- cinity of larger towns, such as Kladno, Slaný, Kutná Hora, Příbram, Nymburk, Rakovník. FOREIGN COOPERATION Inter-Regional cooperation is based on co- operation agreements, the first of which was signed in 2001 between the Region of Cen- tral Bohemia and the French Region of Bur- gundy. In 2003, a four-party statement on cooperation was signed involving Central Bohemia, Burgundy, the Opole Voivodeship in Poland, and Rhineland-Palatinate in Ger- many. This so-called Network of 4 Regional Partnerswas,atthetimeofitsestablishment, the first project associating participants from both member and candidate countries of the European Union. In the same year, the Region concluded an agreement on coop- eration with the Swedish Västra Götaland Region. In 2004, the Region of Central Bohe- mia entered into a bilateral partnership with the Italian Region of Veneto. In 2005, the Re- gion expanded its international activities by signing three further agreements on coop- eration: with the Sichuan Province in China, the Moscow Region, and the Mazowieckie Voivodeship in Poland. EDUCATION The Region is home to the Faculty of Bio- medical Engineering of the Czech Technical University (CTU) in Kladno and three private

| 3 2 CONTACT: TOWN OF BENEŠOV Masarykovo náměstí 100 256 01 Benešov phone: +420 317 754 111 http://benesov-city.cz/ e-mail: podatelna@benesev-city.cz TOWN OF BEROUN Husovo náměstí 68 266 01 Beroun phone: +420 311 654 111 e-mail: posta@muberoun.cz www.mesto-beroun.cz/ TOWN OF KLADNO Nám. Starosty Pavla 44 272 52 Kladno phone: +420 312 604 11 e-mail: magistrat@mestokladno.cz www.mestokladno.cz TOWN OF KOLÍN Karlovo náměstí 78, 280 12 Kolín I phone: +420 321 748 111 e-mail: posta@mukolin.cz www.mukolin.cz TOWN OF KUTNÁ HORA Havlíčkovo nám. 552 284 01 Kutná Hora phone: +420 327 710 111 e-mail: podatelna@kutnahora.cz TOWN OF MĚLNÍK nám. Míru 1 276 01 Mělník phone: +420 315 635 111 e-mail: podatelna@melnik.cz TOWN OF MLADÁ BOLESLAV Komenského náměstí č.p.61 293 49 Mladá Boleslav phone: +420 326 715 111 e-mail: e-podatelna@mb-net.cz www.mb-net.cz TOWN OF NYMBURK Náměstí Přemyslovců 163 288 28 Nymburk phone: +420 325 501 101 www.mesto-nymburk.cz TOWN OF PŘÍBRAM Tyršova 108 261 19 Příbram I. phone: +420 318 402 211 e-mail: e-podatelna@pribram-city.cz TOWN OF RAKOVNÍK Husovo náměstí 27 269 01 Rakovník phone: +420 313 259 111 e-mail: posta@murako.cz R E G I O N universities – ŠKODA AUTO, a. s., University in Mladá Boleslav, Central Bohemia Univer- sity Institute in Kladno and Academia Rerum Civilium – College of Political and Social Sci- ences, s. r. o., in Kolín. The Academy of Pro- ductivity and Innovations (more about API on page 38) also offers managers the op- portunity to extend their professional edu- cation. SCIENCE AND RESEARCH IN THE REGION New scientific and research institutions are established every year. There were 108 insti- tutionsregisteredintheRegionofCentralBo- hemia in 2001, 162 in 2005, and the number of professionally oriented institutions grew to 215 by 2010. The majority of these are en- terprise sector institutions (90.2%), with the rest belonging to the government, universi- ties, or the non-profit sector. When it comes to Regional division of R&D expenses, the Region of Central Bohemia has, for a long time, placed second (behind Prague), and when considering R&D expenses in the en- terprise sector, it even takes the first place in the Czech Republic. TOURISM The most commonly accommodated guests in the Region of Central Bohemia are dom- estic visitors – 77.4% in 2010. The share of accommodated guests from the CR experi- ences a year-on-year growth despite the fact that the absolute number is in decline. The reason is that there was a greater drop in the numbers of foreign visitors; 142.5 thousand foreign tourists sought accommodation in theRegionofCentralBohemiain2010,which was almost three times fewer than in 2000 (411.6 thousand). The majority of foreign tourists comes traditionally from Germany (29.7%). Other accommodated non-resi- dents in 2010 included visitors from Slovakia (12.1%), Poland (7.6%), Austria (6.5%), and the Netherlands (5.4%). The Region strives to support the tourist trade by a number of different ways, e.g. by organising regu- lar theme events, such as the Gurmánfest (gourmet festival, September), Poděbradské filmové zážitky (film festival in Poděbrady, June), Pivní slavnosti (beer festival, April) or incidental cultural events (golf tournaments, journeys around the Region on historical trains, festival in Buštěhrad, Christmas Mass in Saint Barbara‘s Church in Kutná Hora, art and trade markets etc.). Cooperation with foreign Regions has also been developing success- fully (Opole Voivodeship, Burgundy, Sichuan, Rhineland-Palatinate, the autonomous Bratis- lava Region etc.).The Region of Central Bohe- mia also opened GASK last year – the Gallery of Central Bohemia in Kutná Hora – which was one of the most efficient investments supporting the development of the Region. There is a number of important and histori- cally valuable monuments in the Region of Central Bohemia, as well as several protected landscape areas. The greatest concentration of monuments can be found in the town of Kutná Hora (Saint Barbara’s Church, Ital- ian Court, Hrádek with the silver mines, Ko- stnice / ossuary), which is a UNESCO World Heritage Site. Besides Kutná Hora, the Czech list of urban monument preservation areas in Central Bohemia includes only Kolín. The most famous castles are Karlštejn and Točník in the Beroun District, Křivoklát in the Rako- vník District, Český Šternberk in the Benešov District,andKokořínintheMělníkDistrict.The most important châteaux include Konopiště in the Benešov District, Žleby and Kačina in the Kutná Hora District, Lány in the Rakovník District, Nelahozeves or the Mělník château. Photo:CzechTourismarchives

3 3 | C Z E C H B U S I N E S S A N D T R A D E The most interesting ruins are Žebrák in the Beroun District and Okoř in the Praha-západ District.The most precious natural area of the Region is the Křivoklátsko Protected Land- scape Area, which is a part of the list of bio- sphere preservation areas; other important areas include the Kokořínsko Protected Land- scape Area, Český kras, Český ráj, and Blaník. INDIVIDUAL DISTRICTS District of Benešov The Benešov District represents one of the best preserved natural areas. The diverse landscape with waterways offers many opportunities for recreation, tourism, and sightseeing. The Blaník Protected Land- scape Area is rich in historical and archaeo- logical monuments. The most important cultural monuments undoubtedly include the romantically reconstructed Konopiště Château, one of the most visited châteaux in Bohemia, with its English-style park. District of Beroun The Beroun District has an extreme wealth of historical monuments. The most famous is the medieval Karlštejn Castle, one of the most monumental in the Czech Repub- lic. More than one-third of the District’s area is occupied by forests. There are two protected landscape areas in the Beroun District – Český kras and Křivoklátsko. The Beroun District, and especially the valley of the Berounka river, is a much-sought recrea- tion and relaxation area. Residents of Prague make use of its multitude of recreation cot- tages and weekend houses. District of Kladno The greatest influence over the develop- ment of the Kladno District was by the coal- mining and metallurgy industries. Besides the aforementioned mining and metallurgy, the District also has a tradition of electrical, machine building, and food-processing in- dustries. A significant number of employers had to limit their activities or went out of business because of economic reasons dur- ing the 90’s. District of Kolín The District can be characterised as indus- trial and agricultural. There is a number of large and small enterprises, mainly oriented at electrical, machine-building, chemical, and printing industries. However, the build- ing of the Kolín-Ovčáry industrial zone with the dominant TPCA, s. r. o., plant for the production of small personal vehicles has caused a major change in the economic potential of the District. The intensive agri- cultural plant production benefits from the excellent conditions in the Labe Valley. District of Kutná Hora There are many cultural monuments of im- mense historical value in the District of Kut- ná Hora. The historic centre of the town of Kutná Hora has been proclaimed a national monument preservation area, and the town is a UNESCO World Heritage Site. The centre of this monument preservation area, unique in Central Bohemia, forms an architectural unitwithoriginsintheGothicMedievalAges that convincingly documents the prosperity of the mining business. Kutná Hora was the true treasury of the country during the four- teenth and fifteenth centuries, with sixty thousand residents. People from the whole of Europe were coming to work in the local silver mines and smelting workshops. District of Mělník The Mělník District is one of the agricultural areas in Central Bohemia. Besides traditional agricultural productions, the District spe- cialises in vegetable and fruit growing. It is also the only District in the Region of Central Bohemia with large-scale vine-growing. The District of Mělník has a number of important cultural monuments. Let us mention, for example, the Nelahozeves Château which houses A. Dvořák Museum (A. Dvořák was born in the village). District of Mladá Boleslav The Joint Stock Company for Automotive Industry in Mladá Boleslav was founded as early as 1895. Throughout its history, which includes Laurin a Klement, Automobilové závody, and today’s Škoda Auto, a. s., it has been making cars. The intensive agricultural plant production benefits from the excel- lent production conditions, with some agri- cultural businesses also growing vegetables on a large scale. District of Nymburk The District is mainly known for the spa town of Poděbrady. The history of the town is older than that of the Czech state.The spas offer treatment mostly for heart problems and diseases of the alimentary tract and the locomotive organs. However, Nymburk is also interesting for investors – there are two industrial zones in the District, as well as in- dustrial production plants. District of Praha - východ (Prague-East) The District forms a part of a circle around Prague. Together with the District of Praha- západ, it has an absolutely unique position in the Czech Republic, one which is evidenced by the majority of socio-economic character- istics. These two Districts, which encircle the capital, Prague – an international metropolis Křivoklát, founded during the 12th century, belonged to Bohemain kings

| 3 4 R E G I O N MAJOR ENTERPRISES WITH PLACE OF BUSINESS IN CENTRAL BOHEMIA (ENTERPRISES WITH 1000 OR MORE LISTED EMPLOYEES) Firm activity (based on NACE) Sellier & Bellot a.s. Manufacture of weapons and ammunition SKLÁRNY KAVALIER, a.s. Manufacture and processing of other glass Carrier Refrigeration Operation Czech Republic s.r.o. Manufacture of non-domestic cooling and ventilation equipment KOSTAL CR, spol. s r.o. Manufacture of electrical and electronic equipment for motor vehicles TIPSPORT a.s. Gambling and betting activities LEGO Production s.r.o. Manufacture of games and toys Oblastní nemocnice Kladno, a.s. Hospital activities Oblastní nemocnice Kolín, a.s. Hospital activities Toyota Peugeot Citroën Automobile Czech, s.r.o. Manufacture of motor vehicles ČKD Kutná Hora, a.s. Casting of steel Philip Morris ČR a.s. Manufacture of tobacco products Behr Czech s.r.o. Manufacture of other parts and accessories for motor vehicles Oblastní nemocnice Mladá Boleslav, a.s. Hospital activities ŠKODA AUTO a.s. Manufacture of motor vehicles TRW-Carr s.r.o. Manufacture of other parts and accessories for motor vehicles AERO Vodochody a.s. Manufacture of air and spacecraft and related machinery AGP PLUS SERVICE s.r.o. Temporary employment agency activities BILLA, spol. s r. o. Retail sale in non-specialised stores with food, beverages or tobacco predominating Mountfield a.s. Retail sale of hardware, paints, glass Penny Market s.r.o. Retail sale in non-specialised stores with food, beverages or tobacco predominating Ústav jaderného výzkumu Řež a.s. Other research and experimental development on natural sciences and engineering Window Holding a.s. Manufacture of builders’ware of plastic AAA AUTO a.s. Sale of cars and light motor vehicles Maurice Ward & Co., s.r.o. Logistics and Transport Oblastní nemocnice Příbram, a.s. Hospital activities Heineken Česká republika, a.s. Manufacture of beer Source: Czech Statistical Office – form together the Prague-Central Bohemia urban area and serve as Prague’s rear. District of Praha - západ (Prague-West) The District’s territory forms a crescent that encircles Prague. The District also shares its longest border, in the east, with Prague. It has the same role as the District of Praha - východ. It is also an important recreation area. District of Příbram The District of Příbram is largely rugged with many forests. The history of the town of Příbram has been linked with mining since long past. The District’s development following WWII can be attributed to min- ing, especially of uranium ore, which, on the other hand, caused serious environmental problems for current generations. District of Rakovník The Rakovník District is known in the Czech Republic for its chemical and stoneware in- dustries. The chemical industry is represent- ed by the production of washing powders and detergents, while the stoneware indus- try is linked to facing tiles. Agriculture in the northern and central parts of the District has ideal conditions for hop-growing thanks to quality soils. The Křivoklátsko Landscape Protected Area, which was declared a bio- sphere preservation area by UNESCO, is a part of the District. FUTURE DEVELOPMENT One of the main areas of interest, now and in the future, for the Region of Central Bo- hemia is support for the Region’s knowl- edge economy and improving its competi- tiveness. Great emphasis is being placed on the revitalisation of brownfields. Select- ed examples of the Region’s activities in this area may be, among other things, the prepared development projects and activi- ties in two of the largest brownfields in the Region: the former military training ground in Milovice–Mladá and in Ralsko–Vrchbělá. The Region supports innovation projects and is a partner of key scientific and re- search projects in the CR – the ELI interna- tional laser centre and the Biotechnology and Biomedicine Centre of the Academy of Sciences and Charles University in Vestec (BIOCEV) – more about these projects on pages 35 and 37. Another top project that is being prepared in the Region of Central Bohemia for almost CZK 2.5 billion as a part of the Operational Pro- gramme Research and Development for Inno- vation (OP RDI) is the SUSEN project (Sustain- able Energy).The aim of this project is to build a top centre oriented at advanced nuclear technologies. The project was submitted by Centrum výzkumu Řež, s. r. o. (CV Řež), and the University of West Bohemia is a minority part- ner. The project will be realised in Řež u Prahy (on the premises of the Nuclear Research In- stitute Řež) and in Plzeň (Plzeň Science and Technology Park, Borská pole). In 2011, the Council of the Region of Central Bohemia approved the Region’s intention to build the Vodochody Airport, which should become the third public in- ternational airport in the Region after the Ruzyně Airport in Prague and the public international airp ort in Mnichovo Hradiště. The airport, which lies to the north of Prague, wants to process 3.5 million travel- lers per year in the future, mainly for low- cost airlines and irregular or private flights. The airport should compete with the Ruzyně Airport, which has approximately 12 million travellers per year.

The development of science-technol- ogy parks and other infrastructure neces- sary for innovative companies in the Czech Republic is supported by the Prosperity pro- gramme, which provided funding for the Roztoky project as well. The science-technol- ogy park has an overall utility area of 4 200 square metres and will employ approximate- ly 150 people in the future. In cooperation with the CTU and the enterprise sector, it will conduct research and development in the field of combustion engines for cars and en- gines with alternative drive and build vehicle transmissions.”The science-technology park will provide its partners with an optimal envi- ronmentforthedevelopmentoftheirinnova- tionactivitiesandnecessarycapacitiesforthe purposes of applied research and develop- ment,” stated Hugo Jandl, the project’s Chief 3 5 | Manager. Besides Trigema’s (the project’s ini- tiator) own financial sources, the realisation of the project was supported by a grant from the Operational Programme Enterprise and Innovation. “The Roztoky science-technolo- gy park is an example of the utilisation of the synergy effect,” said Jan Macek, the Head of Josef Božek Research Centre. “Our company made use of the experience and knowledge from other investment projects when pre- paring and building the VTP Roztoky,” noted Marcel Soural, the Head Manager of Trigema, and added: “The Roztoky science-technol- ogy park represents a long-term investment that shows a sensible way of using European funding.”In recent years,Trigema successfully realised the project of the Congress Centre Academic in Roztoky and the Sportrelax Centre in Monínec. C Z E C H B U S I N E S S A N D T R A D E New Science-Technology Park in Roztoky Anewscience-technologyparkwas openedinRoztokyuPrahyinNovember 2011atacostofalmostCZK0.5billion.The parkismainlyorientedtowardsresearch anddevelopmentofcombustionengines forcarmakersandengineswithalternative drive.Thismeansthatthenewresearch anddevelopmentcentrewillbeused primarilybyfirmsfromtheautomotive industryandresearchersanddevelopers fromtheFacultyofMechanicalEngineering attheCzechTechnicalUniversityinPrague. ELI Superlaser – Greatest Scientific Project in History of the Czech Republic ELI (Extreme Light Infrastructure) is an international project listed in the European Roadmap for Research Infrastructure (ESFRI), which aims to build and operate a unique laser facility that will uti- lise top laser technologies for gen- erating the most intensive light pulses ever achieved in the world. This laser will be the nucleus of an application centre for the develop- ment of new materials, compact ultraintensive sources of light and particles and for basic research in quantum and relativistic physics. The Czech Republic has, along with Hun- garyandRomania,acquiredanofficialmandate from all 13 European partners in October 2009 for the implementation of ELI, which consists of building three laser centres under the uniform ELI brand. This decision was fully backed up by the European Commission. The Czech cen- tre,“Beamlines Facility”, will be located in Dolní Břežany in the Region of Central Bohemia, and at the centre of its interest will be research of ultraintensive secondary sources for interdisci- plinaryapplicationsinphysics,chemistry,medi- cine, biology, and material engineering. The facility should fit into a building of 120 x 140 metres, and it should be operational by 2016. THE CZECH REPUBLIC IS RESEARCH SUPERPOWER ELI Beamlines is a part of a European plan to build large research infrastructures of a new generation. 40 research institutions from 13 countriesparticipatedinthepreparatoryphase of the project. Starting with 2016, ELI Beam- lines will bring new, and hopefully revolution- ary, knowledge in fields such as physics, optics, photonics, or nano-science. The laser centre in Dolní Břežany could facilitate radical develop- ment in laser physics, material research, mo- lecular biology, or medicinal diagnostics. In practice, the new laser-controlled sources will allow for improvements in detection methods in medicinal diagnostics (particle images with very high resolution). This could contribute to a better understanding of complex diseases suchascancer(protontherapyinparticular).All in all, the Czech Republic has, for the first time, a serious chance of being in the leading posi- tioninthesefields–withalltheincrediblyposi- tive consequences for the national economy. RENAISSANCE OF SCIENTIFIC ANDTECHNICAL FIELDS “Both Czech and foreign scientists with expe- rience from such prestigious institutions as CERN, Rutherford Appleton Laboratory, or the Max-Planck-Institut für Quantenoptik already work on the ELI project. We will, of course, ex- ploit this fact – together with universities, we wouldliketopreparepost-graduatestudypro- grammes that would be beneficial for the next generations of scientists,”saysVlastimil Růžička, the Managing Director of the ELI Beamlines project.. This means that the state does not invest only in research but also in top science and technical education, which is one of the most efficient economic stimuli imaginable. More at www.eli-beams.eu/

| 3 6 R E G I O N Region of Central Bohemia Offers Modern Storage and Production Zones The Region of Central Bohemia was historically the first region where modern storage halls intended for rent were established. The first such building was completed in the Rudná u Prahy Business Park in 1997, which is in the vicinity of the D5 highway. The Zličín Business Cen- tre zone within the territory of the capital, Prague, followed in 1998. The following year saw the first storage halls by the D1 highway enter the emerging mar- ket of modern storage space.The AIG Lincoln developer company built these halls as a part of the former D1 Logistic Park (today’s ProLo- gis Park Prague D1 East &West). In view of the fact that the Region of Central Bohemia is the largest region in the CR, it does not come as a surprise that it is also the most developed region of the Czech Republic with regard to modern industrial space on offer. The overall amount of available space is 1.4 million sq. m, which represents 35% of the amount of rental space in the Czech Republic (3.99 mil. sq. m). The amount of available space in the Region of Central Bohemia may grow by an- other 1.7 million sq. m in the future. The ma- jority of the currently available class-A space in this part of the country is mainly intended for storage, logistics, and distribution rather than production. FAVOURABLE RENTAL CONDITIONS Thanks to the big number of areas, the Re- gion of Central Bohemia is where the most fa- vourable rental terms may be had.The strong competition along with the high percentage of available space, which exceeds the coun- try’s average, represents an interesting posi- tion for renters. The lowest rent can be cur- rently had in the northern part of the Region (in the vicinity of the R7 main road and the Photo:ColliersInternationalPraguearchives,BIOCEVarchives D8 highway). Standard storage space ex- ceeding 2000 sq. m can be rented for 5 years at the rate of EUR 2.50 per sq. m per month. The basic rent, which does not include incen- tives offered by the majority of developers, is between EUR 3.20 and EUR 4.50 per sq. m per month. Built-in administrative space is avail- able for EUR 7.00 – EUR 9.00 per sq. m per month, based on its age and quality. MOST UNITS ARE IN WESTERN AND NORTHERN PARTS OF REGION Despite the above-average rate of avail- ability, the selection of space available for immediate use is quite limited. The highest number of units of various sizes is available in the western and northern parts of the Region of Central Bohemia (between high- ways D5 and D8). The southern and east- ern outskirts of Prague (between D1 and R10) do not offer a comparable selection of available units. In case of larger require- ments (over 5000 sq. m), a construction of space according to the future user’s specific technical and space requirements can be realised almost anywhere. Zones that offer smaller storage units (below 1000 sq. m), often combined with showrooms, can be found on the borders of the Region of Cen- tral Bohemia and Prague. Rental rates for these units are usually EUR 4.80 – EUR 6.90 per sq. m per month for the storage part and EUR 7.50 – EUR 12.80 per sq. m per month for the administrative space. More at www.colliers.com Panattoni Park Prague Airport Impera Park Hovorčovice

3 7 | C Z E C H B U S I N E S S A N D T R A D E BIOCEV Project Implemented by Best Research Centres in the Czech Republic The European Commission has approved a grant from European funds in the amount of CZK 2.3 billion for a new biomedicine and biotechnology centre, BIOCEV, which should be built in Vestec near Prague by 2015. This means that the Czech Republic will have not only the unique Centre for Phenogenomics, which will include the so-called “mouse clinic”, but also a top centre for the education of young scientists or enterprise professionals. With the signature of Johannes Hahn, the European Commissioner for Regional Policy, from November 2011, four years of work by leading Czech scientists and pro- fessionals from the Academy of Sciences of the CR and Charles University in Prague have been completed. The European Com- mission sent an affirmative decision to the Czech Republic regarding the realisation of the scientific centre of excellence project, BIOCEV. “The BIOCEV centre is already the fifth approved project out of the six elite so-called big projects of the Operational Programme Research and Development for Innovation. The centre aims to fill the considerable gap that can be seen not only in research in the area of sciences concern- ing living nature but also in the links be- tween research and development and the private sector and in the support for trans- ferring achieved results into practice. The biotechnology industry cannot, obviously, work without an appropriate background – top scientists, technologies, or related education; and BIOCEV will provide such a background,”said Josef Dobeš, the Minis- ter of Education, in reaction to the issuance of the decision. RESULTS DIRECTLY INTO PRACTICE “A number of commercial companies have expressed their interest in future cooper- ation with the BIOCEV centre so far”, affirms Jan Rajnoch, the Project Manager. These include, for example, the international pharmaceutical group Zentiva or several biotechnological firms based in the im- mediate vicinity of the future BIOCEV cen- tre. Output and knowledge acquired from basic research realised in BIOCEV should be subsequently applied directly in prac- tice, e.g. in the form of new, “custom-made” pharmaceuticals. BIOCEV scientists will work on determining specific functions of genes responsible for various heart and liver ill- nesses or hearing deficiencies. There is an application potential for research in the field of virus infections and their associations with tumorous illnesses or in the develop- ment of new biomaterials for blood-vessel or heart-valve replacements or for skeletons for the regeneration of spinal cord damage. The complexity of research in BIOCEV can also be illustrated by the potential use of its results in green energetics, such as waste processing, or by the development of new therapeutic and diagnostic procedures for healthcare, reproductive disorders, or con- genital metabolism defects.

| 3 8| 3 8| 3 8 R E G I O N Six institutes of the Academy of Sciences of the CR participate in the BIOCEV project (Institute of Molecular Genetics, Institute of Microbiology, Institute of Physiology, Institute of Experimental Medicine, Institute of Macromolecular Chemistry, Institute of Biotechnology) along with two faculties of Charles University in Prague (Faculty of Science, 1st Faculty of Medicine).The aim of the scientific project is to gain a detailed understanding of cellular mechanisms on the molecu- lar level, which will serve as an inspiration for applied research and research of new therapeutic procedures, early diagnostics, biologically active substances, including chemotherapeutics, protein engineering and other technologies that will lead to the improvement of the quality of life, development and growth of knowledge economy, and the competitiveness of the CR.The centre will be built inVestec in the region of Central Bohemia. BIOCEV is already participating in the following international projects: Infrafrontier, Euro-BioImaging, and Instruct. The study programme Industrial Engin- eering at the Academy of Productivity and Innovations in Slaný (API) is not primarily intended for graduates but rather for managers from industrial enterprises who wish to acquire or extend their knowledge. It is designed to address the shortage of leaders who are capable of finding ways to infuse companies with new life, who know where to save money and what to develop, who are able to motivate their subordinates for greater performance. The Academy was established on the basis of Mr. Zbyněk Frolík’s (the owner of LINET) idea regarding methods to fill the gap between accessible education and the needs of production enter- prises.Ms.DenisaŠkopová,API’sExecu- tive Director, provided the following answers to our questions. HowlonghastheAcademybeen inoperation,andwhatwasthereason foritsfounding? API was founded in 2005 as a company that provided enterprises with complex consult- ing and educational services in the area of in- dustrial engineering.The establishment of the Academy was a reaction to the shortage of managers with an interdisciplinary focus, who would be able to realise projects that increase the productivity of enterprise processes. WhydoestheAcademyoffertheIndustrial Engineeringstudyprogramme? API has many years of experience with edu- cation and project activities in the field of in- dustrial engineering, and as such it can offer its clients not only complex know-how but also an emphasis on the ability to apply the acquired knowledge in practice – in specific projects and real-world processes. However, the Industrial Engineering study programme is, by far, not the only product offered by API to its clients. In the field of industrial engineer- ing, API provides a comprehensive set of edu- cational tools: apart from the aforementioned study programme, this includes seminars, company trainings, educational programmes, conferences etc. Whatfieldsdoyourapplicantscomefrom? The study programme is designed for mem- bers of middle to upper management of in- dustrial enterprises who wish to acquire or enrich their knowledge in the field of indus- trial engineering. The studies are especially suitable for company department directors, employees from planning and production control departments, employees responsible for technical preparation of production, em- ployees from logistics and improvement de- partments, process engineers and industrial engineers. Whatareyouracceptancerequirements? Applicants should come from one of the listed fields or positions and should be inter- ested in active participation in the studies. Students should have a completed second- ary education and have relevant experience from a production enterprise. The capacity of the programme is limited to 15 participants, and acceptance is determined by the order in which applications have been received. Whywouldyourecommendmanagers tostudyatyourschool? The Industrial Engineering study programme expands education by a complex body of pro- fessional knowledge and practical skills that allow for the realisation and management of projects with the goal of improving the ef- ficacy of company processes. The usability of the imparted pieces of knowledge in practice is ensured by appropriately complementing theory with the lecturers’practical experiences. The studies include not only lectures and indi- vidual consultations with the lecturers but also study visits of selected enterprises, trainings basedonrealcasestudies,andworkshops.The study programme also includes the realisation of a specific project, which is executed by each participantintheircompany.Successfulgradu- ates are awarded diplomas issued by API and the Institute of Industrial Engineering as well as the right to use the IEn. title with their name. Managerial Education in Practice BIOCEV PARTICIPATION IN INFRAFRONTIER The Czech Centre for Phenogenomics will be an indispensable part of the BIOCEV cen- tre (including the mouse clinic). 99% of the mouse genome is identical to that of humans, which makes mice the most suitable model for researching genes and genetic diseases in humans. The mouse clinic will be equipped with the most modern instruments, but, most importantly, talented scientists will work there. This was critical for the inclusion of the BIOCEV centre in the European network, Infrafrontier. “The participation of BIOCEV in European re- search programmes is a prerequisite for truly top research. Another prerequisite is to have talented scientists work in the BIOCEV centre. BIOCEV’s scientific personalities represent one of the strongest aspects of the whole project,” says Václav Pačes, the scientific coordinator of the project and former chairman of the Acad- emy of Sciences of the CR. More at www.biocev.eu

MIP www.mip.cz Check in your dreams with us attractive environment • prestigious presentation forms • international impact

FANS

1 2012 NANOTECHNOLOGY,BIOTECHNOLOGY, MEDICAL,OPTICAL,ANDMEASURINGDEVICES SupplementofCzechBusinessandTrade

ROSENPHARMA Travel Aescin: flying help Soluble Aescin in effervescent tablets has fast impact on your health. The tablets eliminate the sensation of heavy legs and swellings caused by a long period of sitting during travel or work. Aescin reduces swellings after injury, and helps to remove hoarseness, to decrease symptoms of allergic reactions. Sug- gested for holidays. The Brainer: speedy brain stimulation Edible granules for instant brain stimulation, activation, fatigue combat. They add energy, stimulate thinking. Suitable for drivers, nightwork , study , never-ending meetings. Polysan products: Green line for skin protection, healing Completely natural Magnesium-based gel and creams manufactured by an original Czech formula, tested and verified by long pharmaceutical practice, registered as cosmetics. The products are free of preservatives, additives. Magnesium gel – treatment of weeping eczema, cold sores. Magnesium / Olive oil cream – soothing and healing not only of sun burns, Psoriasis, Erysipelas, powerful skin shield. By application with strong cooling effect. Magnesium / Ichtamolum / Olive oil cream – active eczemas treatment. Magnesium / Hyaluronic acid / Olive oil cream – effective skin healing by irritation of injuries, eczema, peeling treatment, tatoo, all variety of burns. e-mail: ruzicka@rosenpharma.com www.rosenpharma.com

3 | N A N OT E C H N O LO G Y, B I OT E C H N O LO G Y, M E D I C A L , O P T I C A L , A N D M E A S U R I N G D E V I C E S Nanotechnology, Biotechnology, Medical, Optical, and Measuring Devices Supplement of Czech Business and Trade 1/2012 CONTENTS ANALYSIS Nanotechnology Makes Advances in the CR 4 ENTERPRISE The Use of Nanotechnologies Brings Breakthrough Changes 6 Tradition, Investment, and Innovation in Medical, Optical, and Measuring Instruments 8 Export Alliance - Gateway to Success in Exports 12 Brno: One of the Most Innovative Regions 14 CZECH TOP World-class Optics Producer 10 INVESTMENT New International Centre for Applied Medical Research 16 RESEARCH SAFMAT Provides Top Conditions 18 CEITEC Will Also Focus on Nanotechnologies 19 TOPTEC Centre for Special Optics and Optoelectronic Systems 21 EDUCATION Nanotechnology Degree Courses Are Offered at a Number of Czech Universities 20 SURVEY 22 USEFUL INFORMATION 22 PRESENTATION OF FIRMS: Český metrologický institut; FOSAN s.r.o.; HOMMEL CS s.r.o.; Meopta - optika, s.r.o.; RosenPharma a.s.; ZPA EKOREG, spol. s r.o. MK ČR E 6379 This magazine is published as a supplement of the Czech Business and Trade economic quarterly. Managing Editor: Pavla Podskalská Editor: Jana Pike Graphic Designer: Pavel Kroupa, Anežka Zvěřinová Production: Anežka Zvěřinová Address: PP Agency s.r.o. Myslíkova 25, 110 00 Praha 1, Czech Republic Phone: +420 221 406 622, e-mail: journal@ppagency.cz www.ppagency.cz Deadline: 1/3/2012 Attitudes expressed by the authors of articles in this magazine are not necessarily consistent with the viewpoint of the Publisher. Coverphoto:CEITECarchives;page3photo:PhotoCombo

| 4 A N A LYS I S More than 230 entities in the public and pri- vate sectors are already engaged in the area of nanotechnology in the Czech Republic. And the interest in this cutting-edge sec- tor of the future is rising, especially among companies. They see in it the chance to leave their competitors behind, and are beginning to use industrial applications of nanotechnology, especially in the manu- facture of nanomaterials. An opportunity to learn about the results of nanotechnology research and development in the Czech Republic and abroad will be offered by the international conference, NANOCON 2012, to be held in Brno from 23rd to 25th Octo- ber 2012, the largest event of its kind in the Czech Republic. Nanotechnology is no longer only a mat- ter of basic research. It finds applications in environmental protection, in commu- nication technologies, medicine and gen- etics, and helps to upgrade products and make production processes more efficient. Goods with the “nano“ prefix are flooding the markets. Globally, 2100 companies in 48 countries are involved in nanotechnol- ogy research and nano product manufac- ture (according to 2010 statistics of the na- nowerk.com portal). Since 1996, more than 3 000 patents concerning nanotechnology have been granted. According to the Lux Research estimates of 2010, nanotechnol- ogy earned the global economy USD 251 billion in 2009, and in 2015 this is forecast to be as much as USD 2.4 trillion. In the com- ing years, nanotechnology is expected to impact on almost all industrial sectors, and very profoundly on some of them. 2008), China (USD 430 million, 2008), South Korea (USD 310 million, 2008), and Taiwan (USD 110 million, 2008). The USA is also the country with the highest private investment going into nanotechnology. The purpose is obvious - to maintain the global primacy in this strategic sector. Nano Research in the CR Given the fragmented system of support for research and development (R&D) in the Czech Republic, the resources allocated to nanotechnology R&D in the country can be only estimated. In 2008, they amounted to about CZK 1.85 billion (approx. EUR 74 million), 91% of the amount from public sources (mainly through the Academy of Sciences, the Ministry of Education, and partly also the Ministry of Industry and Trade). Presumably, this volume was at least maintained in 2011, when large research projects from the Academy of Sciences programme, Nanotechnology for Society, and the research plans and projects of re- search centres financed by the Ministry of Education were being completed. In addi- tion, the EU Structural Funds have started to play a role in nanotechnology research in the CR, especially in terms of the build- ing of infrastructure and the acquisition of modern laboratory instruments in regions outside Prague. With the relatively generous state sup- port, the interest of scientists and com- panies in nanotechnology is increasing as well. At present, 28 institutes of the Academy of Sciences (AS CR) are working on these solutions. Most specialists are en- gaged in these issues at the AS CR Institute of Physics (FZÚ-www.fzu.cz), where they are also completing the largest number of research tasks. Last year, for example, a group of Institute of Physics researchers discovered a new principle of spintronic device based on antiferromagnets, which represents a breakthrough in the further development of sensors and microscopic computer parts. “This has opened to us an entirely new field of anti-ferromagnetic materials with metallic and semiconductor properties, which is much wider and richer than metallic ferromagnets, to which spin- Photo:Elmarcoarchives Nanotechnology Makes Advances in the CR Jiřina Shrbená, Inova Pro s.r.o., e-mail: inovapro@inovapro.cz, www.inovapro.cz The most research tasks have been brought to practical applications in the chemical industry. For example, nano- films have found their use in solar panels, light emitting diodes, photonics, wireless communication, and semi-conductors. Nanotechnological applications have also spread quickly in the manufacture of me- dia for data storage. They allow, e.g., the thought of mobile phones with memory capacity in the order of terabytes. In the coming years, the market dynamics are to be driven up mainly by demand from the defence industry and healthcare, those are branches not greatly affected by fluctu- ations in the economic cycle (as are some others). While the nano product market is to be dominated by the United States and Western Europe up to 2015, in subsequent years their share is to drop in favour of countries of Asia and the Pacific. The nanotechnology boom is driven by huge government spending worldwide on research in this leading edge sector. The most generous of all is still the US Adminis- tration, which has allocated USD 2.1 billion to nano research for this year, and a total of USD 16.5 billion since 2001. The USA is fol- lowed by European Union countries (USD 1.7 billion in 2008), Japan (USD 950 million, WHAT IS NANOTECHNOLOGY Nanotechnology is research and technological develop- ment on an atomic, molecular, or macromolecular level, at the scales of approximately 1–100 nanometres (nm, i.e. 10-9 m), and the application of this knowledge to cre- ate useful materials, structures, and devices. Entities engaged in nanotechnology R&D in the Czech Republic Entity Number in 2005 Number in 2008 Number in 2011 Research institutes of AS CR 18 26 28 Universities 13 15 18 University faculties 28 37 45 Private research institutions 9 15 23 Contributory organisations 4 9 16 Large enterprises 6 12 16 Small and medium-sized enterprises 19 57 126 Source: CSNMT, 2011

5 | X X X X tronic devices have been limited so far“, says the head of the team, Tomáš Jung- wirth, who last year received the prestig- ious European Research Council Advanced Grant, worth CZK 62 million (approx. EUR 2.48 million), which is awarded to estab- lished research leaders. Another Institute of Physics team, led by Emil Pollert, is de- veloping nanocomposites, which are in- tended to significantly improve the diag- nosis and treatment of cancer in particular. These materials will allow the targeting of nanoparticles at distinct cell populations in magnetic resonance imaging and mag- netic fluid hyperthermia. In the last two years, the Czech nano- technology chart has been extended by at least 8 regional research centres planning applied nanotechnology research to a lesser or greater degree. Their establishment is to be supported from the EU Structural Funds and the Czech State budget with the total amount of CZK 4.2 billion (approx. EUR 168 million). One of them is the Regional Centre of Advanced Technologies and Materials in Olomouc (www.rcptm.com). Its laboratories have produced, e.g., a universal method for the modification of solid materials by silver nanoparticles, which will find application, for example, in the surface treatment of medical instruments. Similar centres are be- ing established in Liberec, Brno, and Ostrava. Nanotechnology research will also be con- ducted (on a smaller or larger scale) in six gi- ant research centres of excellence which are being built at a cost of CZK 21 billion from EU and Czech funds at Dolní Břežany, Brno, Řež near Prague, Ostrava, and Vestec near Prague (more about some projects in this supplement and in the main issue of Czech Business and Trade magazine). When Ideas Do Not Remain Only on Paper Besides nanotechnology research ca- pacities, the number of companies which consider nanotechnology an important opportunity is also rising in the Czech Re- public. The number of entities engaged in nanotechnology research and develop- ment and the manufacture of nano ap- plications has trebled. This result has been found in a detailed survey conducted by a team of experts, under the heading of the Czech Society for New Materials and Technologies (CSNMT). The highest rate is evident among small and medium-sized firms. Their number has more than dou- bled as compared with 2008. One of them is ELMARCO in Liberec (www.elmarco.cz), which produces machines for the industrial manufacture of nanofibres by electrospin- ning on the basis of a patented technol- ogy developed at the Technical University of Liberec, and develops applications as well, such as a sound absorption material or filters with anti-microbial effects. At the Contipro Biotech firm at Dolní Dobrouč in the Ústí nad Orlicí District (www.contipro. com), several dozen researchers are spe- cialising in the research and development of nanofibres and microfibres from bio- polymers (polysaccharides and proteins), preparations for the healing of wounds, development of media for the targeted distribution of biologically active sub- stances and preparations for biopolymer- based tissue engineering. Gratifyingly, concrete products are begin- ning to appear among the output from na- notechnology research projects. Scanning

| 6 A N A LYS I S electron microscopes from the TESCAN company in Brno (www.tescan.cz), which allow a look into the micro- and nano- world, are in use in as many as 50 countries. A photocatalytically active paint, developed by the Czech Academy of Sciences Institute of Inorganic Chemistry, is manufactured by the Moravian paints producer Rokospol (www.rokospol.cz). Dental implants con- taining nanostructural titanium are offered by the Timplant company in Ostrava (www. timplant.cz). The NANO IRON firm in Rajhrad near Brno (www.nanoiron.cz) is an example that the work of a university research team can result in the establishment of a manu- facturing company in Czech conditions as well. It manufactures nanoparticles of el- ementary iron, which are used by clean-up companies for the remediation of ground- water contaminated with chlorinated hydrocarbons. “Nanoparticles produced by this technology have been applied in real remediation at a number of sites in the Czech Republic. In 2010, we installed a pilot reactor in Hungary using nano iron to complete the clean-up of surface and drinking waters polluted with arsenic“, says Radek Zbořil, one of the founders of NANO IRON and also a Professor at Palacký University of Olomouc. NANOCON 2012 Conference in Brno These and other applications have been and are being born on Czech soil. Their au- thors will present them at the NANOCON conference (www.nanocon.cz) to be held by the Czech Society for New Materials and Technologies (CSNMT) in Brno between Photo:CzechNanotechnologyClusterarchives The Use of Nanotechnologies Brings Breakthrough Changes The Czech Nanotechnology Cluster (CNK) was set up in 2006 already, with the aim of building in the Olomouc Region a group of closely collaborating nanoproduct sup- pliers and firms using nanotechnologies in their own products and in the products of research and educational institutions oper- ating in that area. Currently it associates 12 Czech entities, mainly small and medium- sized enterprises. To find out more about the cluster’s cur- rent aims, we approached Mr LadislavTorčík, Acting Manager and member of the Cluster, with the following questions: These days, nanotechnologies have become significantly involved in the textile, automotive, food, chemical, and building industries, in electrical engi- neering and electronics, precision engineering, biotechnologies, and environmental protection. Your cluster has existed for more than five years. Can you tell us what contribution the Czech nanotechnology firms have made within the area of activity of your cluster and within the international context? Nanotechnologies have penetrated prac- tically all sectors. On the one hand, this brings tremendous opportunities, but on the other, it causes problems of functioning, completely different from those appearing in conventional sectors. Some Czech firms with a potential have emerged, but there are not many. The most active Czech nano- firms are in areas such as biotechnologies, applications for improving the environ- ment, nanofibres, and the textile industry. I have in mind firms operating in the area of applied research. Naturally there are firms concerned with nanoproduct trading, but 23rd October and 25th October, 2012, and devoted to the research and development of nanomaterials. At the conference, spe- cialised presentations by researchers from the Czech Republic and abroad will deal with nanomaterials, their properties and methods of preparation, the issues of na- nostructural metallic materials, nanosilver, polymer nanocomposites, carbonaceous nanomaterials, materials for the electronic and optical industries, and nanoceramic materials. Attention will also be given to biomaterialsformedicine,suchasmagnetic nanobiocomposites and their possible use. In an effort to accentuate the necessity of responsible nanotechnology research and commercialisation, one of the technical sessions at the conference will be devoted to nanotoxicity and the safety of work with nanomaterials and nanoparticles. they are not big enough to gain an impor- tant market position on a global level. In general, it can be said that the past 25 years have seen a really dramatic develop- ment in nanoscience and nanotechnology. Expectations are already coming true that the use of nanotechnology will bring about breakthrough changes especially in elec- tronics, photonics, and computer sciences, as well as in other areas, such as healthcare and pharmaceuticals, power engineer- ing and the environment, agriculture, the military sphere and in industry, for exam- ple the textile industry and engineering. For example, TiO2 and ZrO2 nanopowders are regularly used in cosmetics and the detoxification of contaminated areas, and nano composite materials are used in the manufacture of car parts and aero-com- ponents to which they lend the required firmness and low weight; in bio-medicine, structures called liposomes have been syn- thesised as a means of improving targeted distribution of therapeutics, while magnet- ic nanoparticles are used to analyse body liquids and improve differentiation. Manu- facturers of optical materials, for their part, use nanoparticles for chemo-mechanical polishing. Nano materials are finding wider use in surface finishing, making surfaces more abrasion- and corrosion-resistant, and in filter manufacture. Nanoparticles are widely used in the consumer goods industry, where non-creasing and dirt-free fabrics are made thanks to nanoparticle ad- LadislavTorčík

7 | N A N OT E C H N O LO G Y, B I OT E C H N O LO G Y, M E D I C A L , O P T I C A L , A N D M E A S U R I N G D E V I C E S EXAMPLES OF CNK PROJECTS IN THE AREA OF NANOTECHNOLOGY Purification of water by nanopowder iron (use of new decontamination technologies). Study examining the benefits of nanotechnology- based additives (checking the benefits in relation to lower fuel consumption and emission reduction). Surface finishing with the use of nanotechnologies (innovative solutions in surface protection, devising new properties, such as non-wettability, UV- and abrasion-resistance, anti-bacterial properties, etc.). Antibacterial finishing of textiles by washing (gain- ing antibacterial properties by washing textiles with the use of nanotechnologies). Projects of UP Olomouc, where CNK is a partner. mixtures, and carbon nanotube reinforced racquets are commonly on sale, etc. What are the most remarkable achieve- ments of your cluster? We are especially proud of our application outputs in the form of nanotechnology- based products. An example are products with antibacterial effects, especially our antibacterial gel, which destroys bacteria, moulds, yeasts and spores and helps to ster- ilise bacteria occurring in burns and injured tissues. With its more than 90% water con- tent, it moistens the wound, thus prevent- ing the exposure of nerve fibres, moistening decayed tissues and renewing protein syn- thesis.This facilitates the cleaning and band- aging of the wound and prevents outside particles (dust and bacteria) from penetrat- ing it. Our commercially distributed prod- ucts further include street and sports socks with silver nanoparticle impregnation and antibacterial and deodorising properties. Tests have shown that they liquidate patho- genic strains of, for example, Escherichia coli and a number of other bacteria. Important products in the textile industry are men’s and women’s antibacterial underwear and functional lingerie which, in addition to their antibacterial effects and the removal of un- pleasant sweat odour, also remove perspira- tion vapour from the body, giving a feeling of dryness during exercise. Our products with protective effects are also a great achievement, just as are our hydrophobic paints containing nanopar- ticles, which improve the properties of the materials and consequently of the actual products. Their unique property is the mini- misation of adhesion between the liquid and the surface, where drops form on the treated surface and wash off impurities. The result is dry and pure surfaces requiring less maintenance and cleaning and lower ther- mal conductivity. With the use of modern nanotechnologies, we have devised a spe- cial additive in a form allowing it to be add- ed directly to fuel (diesel). The additive was carefully tested for a long period of time in both laboratory conditions and regular op- eration. The statistically recorded saving on fuel was 11.4%. A member of your cluster, the Nano Trade s.r.o. Company, is also a member of the EU Project 7.RP NanoCOM consortium, entitled “Lowering Barriers for Nanotech- nology Commercialisation via Open Innovation”. One of the activities within the Project is active assistance to new or start-up nanotechnology firms in finding investors for their projects. Can you tell us more about this initiative? This is mainly intended for start-up firms or new firms with a strong growth potential in the area of nanotechnologies. It is quite com- mon for new firms to suddenly find them- selves in a critical situation at some stage dur- ing the early days of their existence, caused by a lack of capital for their further growth. Therefore, an interesting event, Investors’Fo- rum, will be held in Switzerland in May this year, where firms chosen on the basis of the Project will be introduced to investors. How- ever, no firm from the Central European re- gion has succeeded, and all those interested were eliminated from further proceedings because of the low quality of the materials and information they had submitted. Young scientists greatly underestimate this area and universities pay no attention to it. This shows that having a good idea is not enough for success in the market.

| 8 E N T E R P R I S E The health equipment market has a long tradition in the Czech Republic. The further growth of this sector currently benefits from the geographic position of the Czech Re- public, which is situated close to the largest markets of the European Union. Good results are also scored by the sector of optical, time measuring, and precision equipment, which has recorded a considerable inflow of foreign investment. The Czech Republic can succeed in these branches in European competition, which is evident also from the fact that about two-thirds of the total output are designed for export. Support for companies in the Life Sciences sector is one of the objectives of CzechInvest, the Business and Development Agency. One of the examples of large foreign investors do- ing business in the area of health equipment in the Czech Republic is Arrow International (the USA.), which has built here a research, Tradition, Investment, and Innovation in Medical, Optical, and Measuring Instruments development, and manufacturing facility for various kinds of hospital equipment – car- diological, X-ray devices, etc. Another com- pany operating in the CR is Laminar Medica (the United Kingdom), which specialises in the development, testing, production, and validation of insulated shipping systems that are used by the pharmaceutical and biotech- nological industries worldwide. Lohmann & Rauscher (Austria) manufactures wound care materials, sanitary and first-aid products. Otto Bock (Germany) produces and distributes in the Czech Republic prostheses and orthoses, wheelchairs, rehabilitation aids, special home accessories for the handicapped and ortho- paedic footwear. The company Abcheck s.r.o., a subsidiary of the German firm Affimed Therapeutics AG based in Heidelberg, has been operating in Plzeň since 2009. Abcheck specialises in the discovery and generation of human antibodies which are used in the de- velopment of drugs. Key areas where these antibodies are applied are oncology, immu- nology, and the medical branch concerned with inflammation. Abcheck laboratories se- lect antibodies for specific target molecules. The selection process helps to find specific antibodies which are further tested. The out- put is a highly customer specific antibody. Measuring and Optical Devices in the Czech Aircraft Industry Three technical universities and several specialised firms operate in the area of measuring and optical equipment in the aircraft industry. One of them is Honey- well, the US company which launched its operations in the Czech Republic in 1991. It specialises in the development of ad- vanced avionics systems. In the Czech Re- public, Honeywell has facilities in Prague, Brno, and Olomouc. Its research in this area is based on the quality work of Czech universities. Their discoveries assist the domestic manufacturers of sport aircraft in particular. It is encouraging that Czech technical universities are actively search- ing for partners in the private sector to work together to reduce the time needed for the practical application of new and more efficient instruments and optical equipment. At the same time, schools and research facilities are able to obtain fin- ances for the development of these activi- ties from the European funds. Optical Instruments and Equipment The Czech Republic can boast a rich history of projects in the area of research, devel- opment, and production of optical instru- ments and equipment. The list is topped by electron microscopes. The development of these instruments in the Czech territory goes back to the 1950s and is connected with names such as Armin Delong, Ladislav Zobač, and Vladimír Drahoš. They were the only ones able to construct the prototype of an electron microscope in what was then Czechoslovakia. This success was continued by the Tesla Brno enterprise and the Institute of Scien- tific Instruments, that became pioneers of Photo:CEITECarchives

9 | N A N OT E C H N O LO G Y, B I OT E C H N O LO G Y, M E D I C A L , O P T I C A L , A N D M E A S U R I N G D E V I C E S this sector in Europe. After 1989 and the demise of Tesla Brno, their former highly qualified specialists founded several com- panies which are still operating successfully. This change represented another landmark in the history of this sector in the Czech Re- public, when it became one of the Europe- an and possibly even global centres of this state-of-the-art technology, comparable for example with Cambridge. At present, three companies operate in this sector in the Czech Republic – FEI Company, TESCAN, and Delong Instruments, the latter named after Armin Delong, the founder of electron microscopy in the country, who established the company with his students and initiated the manufacture of globally competitive electron microscopes. Microscopes of World Class The largest of these is a Czech manufacturer, a subsidiary of the US FEI Company which has been operating in Brno since 1993. In this Moravian city, it manufactures the complete line of scanning microscopes, the less power- ful transmission microscopes, and a line of its DualBeam systems combining electron and ion beam technology. Its products are used e.g. by Ford and BMW, oil drilling personnel, NASA, and they are in the laboratories of companies such as IBM, Nokia, Pfizer, John- son & Johnson, as well as on the campuses of Harvard and MIT universities. The growing importance of the Brno facility was further enhancedin2010withtheannouncementof the transfer of the manufacture of the Small DualBeam™ line of microscopes from Eind- hoven, in the Netherlands, to Brno, as well as the award won by the Magellan microscope as one of the 2009Top 100 Innovations of the Year. This list is prepared by the R&D Maga- zine every year. Besides the FEI Company, mi- croscopes are also manufactured by the fully Czech-owned TESCAN company, whose in- struments are used by firms and scientific in- stitutions operating in nanotechnology and material engineering practically all over the world. TESCAN, which marked 20 years of its existence in 2011, has gained world renown over time, especially due to its innovative ap- proachandclosecooperationwithtopscien- tific laboratories of universities and scientific institutions, not only in the Czech Republic but mainly abroad. Its largest customers in- clude companies in the United States and Russia, as well as Germany and South Korea, and, in recent years, particularly in China. In- struments of the TESCAN brand are used in important companies, including Shenzhen Huawei Communication Technologies, FAW VOLKSWAGEN Automotive, Beijing, Hyundai Motor Company, and China National Petro- leum Corporation. Last year, the company launched the cutting-edge FERA3 worksta- tion. This is a high-resolution Schottky Field Emission scanning electron microscope with a fully integrated Plasma-source focused ion beam (FIB). Similar systems are required in particular in the semi-conductor industry to ascertain defects in the manufacture of integrated circuits or for 3D metrology. The device has been developed in collaboration with the French company, Orsay Physics, with which TESCAN has been working for several years.

| 1 0 C Z E C H TO P World-class Optics Producer The Meopta Company was founded as early as 1933underthenameOptikotechna.Theinitial- ly small plant that used to focus on manufac- turing basic optical elements has grown into a multinational firm oriented towards research and development, construction activities, and the manufacture of mechanical components and their assembly. What is more, the firm’s sophisticated products are of international quality, which is appreciated by customers all overtheworld.Weaskedthecompany’sagent, MrVítězslav Moťka, about Přerov’s present-day Meopta, the employer of approx. 2500 people. The company manufactures systems for the fields of imaging and illumination, i.e. all that is related to the processing of light and image. Which Meopta products do you consider the most important? I would say that the most important prod- ucts for us are the ones we supply to the au- dio-visual industry, more specifically, projec- tor subsystems for cinemas. Of products that bear the Meopta brand, it is undoubtedly the premium line of rifle scopes for hunters who require top equipment. The portfolio of sports optics, characterised by its out- standing optical performance and beautiful design, is complemented by the Meostar B binocular field glasses and the currently hot novelty, the Meostar S2 spotting scope. The company opened a modernised research centre this year. What innovative ideas have come from your own research? Being a manufacturing company with hi- tech products, Meopta needs its own de- velopment base. Meopta-branded products are all developed from scratch by our con- struction teams. As we wanted to maintain this and stay on the top, we had no choice but to modernise this development base. We have succeeded in building a new, mod- ern development workplace with appropri- ate equipment; the capacities of prototype workshops, which have been equipped with modern CNC instruments and have been expanded. The assembly workshop has a new air-conditioned space, labora- tories have been reconstructed. We also have a new, clean space for the assembly of prototypes from the area of semiconductor applications. You have recently been successful in entering the nanotechnology field. Where do you think its potential lies? Meopta has become involved in several nanotechnology areas. These include ma- nipulation with nanoparticles using the force effects of light, or the so-called opti- cal tweezers, also known as the optical trap or laser microscopic adapter (LMA), which use laser light to move very small particles in a 3D environment. The optical trap is based on the force effects of photons on micro-objects inserted in strongly focused laser beams. Our laser microscopic adapter allows for an easy introduction of ultraviolet, visible, or infra-red light in the optical path of the microscope, which can be used for con- tactless manipulation with micro-objects or living cells sized between 0.1 μm and 30 μm. Another area is water-repellent layers and their application on optical elements. The use of such layers means significantly greater convenience for the users of our op- tical products in all kinds of weather. As can be seen from these examples, the potential lies in the utilisation of our know-how in the field of nanotechnology, from basic research to consumer application, to our products in the area of sports and military optics. How do you manage to beat your competition? What territories are the most important for your export? We try to be the best in all we do. We also collaborate with important partners and Czech universities. Besides this, we try to get young people to join our team and help us create a culture in which people learn from each other. Our current activities are mostly oriented towards the European Union and the USA. However, we will need to expand our activities to countries like China and In- dia in the future. In a year’s time, your company is celebrat- ing 80 years of its existence. What is your vision for the future development of the company? Ever since its founding in 1933, Meopta has been characterised by its ability to combine know-how, in the area of development and manufacture of opto-mechanical and sub- sequently opto-electronic products, with capital. The future depends on our ability to maintain and improve competitiveness, investments, and modernisations. The key task is to bring in new professionals, both labourers and constructors, as well as tech- nologists. Another factor which will impact our future success is product innovation and technology development. Our efforts, which include putting together the brains from universities, research institutions and the company, collaboration with distin- guished experts, such as Professor Košturiak from the Fraunhofer Institute, and the or- ganisation of “Innovation Forums”, all lead to Meopta becoming an important player in the world optics industry. Of course, this list cannot omit the use of outsourcing – we cannot view the optical plants in China solely as competition. Instead, we have to use them as partners, sub-suppliers. Their improvements and the ability to provide quality and cheap supplies is another driv- ing force towards hi-tech and innovative Meopta products. Photo:Meoptaarchives

MEOPTA

| 1 2 E N T E R P R I S E The way to success on foreign markets is a long-term and painful process for smaller and medium-sized Czech firms. Although the firm may have built an excellent posi- tion for itself on the domestic market and may be offering a competitive product or service, this does not automatically mean that its products will attract equal attention in other countries. One of the ways to success is combining forces and presenting itself in other coun- tries not as a separate firm, but as a sector representing the economy of the whole country. That is why CzechTrade has offered its assistance and protection to export al- liances, whose members exchange their experience and knowledge and present themselves in other countries under the name of the Alliance, while taking advan- tage of resources which they would be un- able to afford if acting on their own. In this way, even small companies can present themselves at international events as part of larger and more important groups. Membership of an alliance has many more Export Alliance – Gateway to Success in Exports advantages for the member firms, such as being informed about potential customers and the exchange of valuable experiences gained in joint actions. On the other hand, the advantage of such an alliance for foreign partners is that the group of companies can cover a large project, from preparing docu- mentation to supplying all the parts needed and the completion of the project, includ- ing follow-up services. The Advantages of Export Alliances What are the specific advantages of such export alliances for the participating firms? These are cost reduction in penetrating for- eign markets, innovation and specialisation in high value-added products and services. Membership of the Alliance makes it poss- ible, especially for small and medium-sized firms, to split their finances into marketing, WHAT ARE EXPORT ALLIANCES? Anexportallianceisanassociationoffirmsoperatinginrelated sectors, whose products or services complement each other and the aim of which is their joint presentation and operation on foreign markets. It is away of bringing contracts within the reachofsmallerCzechfirms,whichwouldhavealesserchance of succeeding on foreign markets if acting on their own. The purposeistoputtogetheranassociationoffirmsthatwillcover large projects, from preparing the design, the required docu- mentation,thesupplyofallparts,thecompletionoftheproject and the provision of follow-up services.To this day, CzechTrade Agencyhasinitiatedsometwentyexportalliances. List of Export Alliances CZECH ICT ALLIANCE CZECH NBCTEAM CZECHWATER ALLIANCE BOHEMIA LINE CZECH EXTRACTION AND MINING TECHNOLOGY ALLIANCE CZECH SPACE ALLIANCE CZECH SURFACE FINISHING ASSOCIATION CZECHVALVES ALLIANCE CZECH HEALTH & SAFETY ALLIANCE ENGINEERINGTECHNOLOGY ALLIANCE SANS SOUCI CZECH GLASS ALLIANCE CZECH BIO ATOMEX GROUP ASSOCIATION OF MANUFACTURERS AND SUPPLIERS OF MEDICAL DEVICES CZECH POWERTEAM EURO ECO SOLUTIONS- ALIANCE (EES-A) Photo:www.sxc.hu

1 3 | N A N OT E C H N O LO G Y, B I OT E C H N O LO G Y, M E D I C A L , O P T I C A L , A N D M E A S U R I N G D E V I C E S presentation and negotiation in other coun- tries or for representation on the market.The firms may share their technologies, distribu- tion channels, suppliers and services and, as a consequence, reduce their unit costs.“The ambition of the Czech Water Alliance (CWA) is to keep the firms associated in it continu- ously informed about foreign competition. We conduct our own surveys as regards foreign interest in firms associated in CWA. In this respect, we collaborate closely with CzechTrade, specifically with the Agency’s offices in other countries,” says Ivan Nikl, CWA Leader. It is very important for firms to be able to use the services of all the offices of CzechTrade abroad. Most members of the Alliance are seeking the establishment of new and the promotion of existing trade contacts and relations. Another association, the Engineering Technology Alliance, par- ticipates regularly in important trade fairs in other countries. For example, this year it participated in the IESS fair, which took place in Bombay from 22nd to 24th March, where products and technologies of sectors such as the automotive, railway, and textile industries, the power industry, telecommu- nications and the transport infrastructure, in addition to machine tools and forming ma- chines were on display. How Does the Alliance Work? If an alliance wants to obtain assistance from the state, it must comprise at least three firms whose production programmes or range of products complement each other in the specific sector of economic activity and which have concluded a coop- eration agreement in the framework of the programme of the Alliance. The members of the Alliance elect a leader from among their midst, usually the most experienced exporter or firm, which has the largest number of contacts with their domestic counterparts. CzechTrade then encourages and helps them prepare everything which still has to be done before the group starts its marketing activities abroad. The Agency helps them prepare the export project, the catalogues and websites. Example of Successful Cooperation The alliances have built a relatively successful history since they started their operations in 2005. For example, the Czech Extraction and Mining Technology Alliance has obtained large orders in Russia, and has also shown good results in the area of water treatment and environmentally friendly products, in which regard the Water Management Ex- port Alliance has established contacts in Pe- tersburg. Last year, the Czech Water Alliance participated in the Waste Tech Exhibition in Moscow, where it signed contracts on co- operation with the non-commercial organ- isation, Rossiyskoe vodnoe obshchestvo.“We are laying foundations for a more intensive start of Czech firms operating in the area of water management and, together with the firms, are planning extensive participation in the ECWATECH exhibition in Moscow in 2012,”says Ivan Nikl, Leader of the Alliance.

| 1 4 E N T E R P R I S E Brno: One of the Most Innovative Regions Biotechnologies and nanotechnologies are witnessing a massive upsurge. Biotechnol- ogy in particular is a sector which has been broadening its range of interests, penetrating into a number of follow-up branches, such as healthcare, agriculture, and industry. The Czech Republic is keeping pace with world progress in biotechnologies. Although just ten years ago, biotechnology was prac- tically non-existent in Eastern and Central Europe, skilled labour, relatively low costs and the tradition of conventional technologies in beer-brewing and the manufacture of antibiotics have assisted in its development in this country, which has a traditionally very strong system of educational and research institutions. Collaboration with Research Sphere In South Moravia, biotechnology is consid- ered one of the most promising branches in the Region, where a number of interesting projects have already been launched in this area.The two most important are the Interna- tional Clinical Research Centre (FNUSA-ICRC) and the Central European Institute of Tech- nology (CEITEC). More about the projects can be found on pages 16-17 and 19). In Brno’s four universities, some 10 000 students are enrolled in Biotechnology courses and an- other 20 000 students in technical branches relying on biotechnology expertise. The Re- gion has a number of research workplaces devoted to biotechnological research. Brno’s research teams, specialising in structural bi- ology, protein engineering and the study of stem cells, rank among the “absolute world élite”. In addition, scientists have important links to foreign research teams and firms operating in the area of biotechnology. The South Moravia Region has set itself an ambi- tious aim: to be among the first 50 most in- novative regions in the European Union by the year 2013. Biotechnology is to play an important role in this respect. Unique Products under the INBIT Aegis The INBIT Innovation Park, located within the premises of the new campus of Masaryk Uni- versity in Brno-Bohunice, has been in service since2008.Theinstitutionresponsibleforitsop- eration is the South Moravia Innovation Centre (JIC). INBIT is one of the projects of the South Moravia Region which has set itself the aim of occupying 20th position in every high-tech specialisation by the year 2020. Its purpose is to help innovative biotechnological firms and companies operating in related branches. For more details, we addressed Jiří Hudeček, Direc- tor of JIC, with the following questions: What does INBIT offer to businesses? The purpose of the INBIT Innovation Park is to concentrate in one place different tools of support for start-up firms with innovative aims before they can stand “on their own feet”.The basic element of the system is com- prehensive services. INBIT offers modern of- fices and laboratories, pleasant surroundings and top-standard technological equipment on an area of 2 957 sq. m. For firms, entry into the Innovation Park also means a financial savings, as they can use their money directly for the development of their product and complete it sooner than they would other- wise be able to. To firms that do not require office space, but want to use the other serv- ices of the Innovation Park, JIC offers “virtual rent”. A firm can rent 1 sq. m of office area at a symbolic price and use all the advantages offered by JIC. What projects are currently under way at INBIT? INBIT currently provides working ground for 14 firms, many of which supply unique products. For example, the Park is the seat of Mendel Therapeutics, a company concerned with the research of immune system sup- porting substances and research in the area of pharmaceuticals’ transport. The company was established in April 2009 as the outcome of long-term scientific cooperation between Brno’s Veterinary Medicine Research Institute and the Prague Institute of Organic Chem- istry and Biochemistry, known for Professor Holý’s research of antiviral substances, and the London company of ImuThes Ltd. An- other firm with its headquarters in the Park Jiří Hudeček Photo:INBITarchives

1 5 | E N T E R P R I S E is IMUNA CZ, concerned with the innovation of anti-staphylococcus lysate used in medi- cine as a local preparation for the treatment of staphylococcus infections. Then there is Enantis, a biotechnological company con- cerned with development in the area of en- zyme technologies and protein engineering for biomedicine, environmental protection, agriculture, and the military defence sector. The company has developed a considerate method of liquidating the dangerous mus- tard combat gas with the help of enzymes. Enantis came into being as a spin-off in close collaboration with the Loschmidt Laborato- ries at Masaryk University in Brno. Do you collaborate with similar associations abroad? The South Moravia Innovation Centre col- laborates with a number of foreign entities, in both the business and academic areas. JIC is also a member of a number of international networks,suchasEnterpriseEuropeNetwork, which provides consulting services in Europe not only for small and medium-sized enter- prises, but also for research institutes, uni- versities, technological centres and business and innovation promotion agencies, and the European Business & Innovation Centre Net- work (EBN); UK Business Incubation (UKBI), ACHIEVE MORE Partnership, International Association of Science Parks (IASP), Innovat- ing Regions in Europe (IRE), etc. Proof of the internationalisation of the JIC Innovation Park is its 3rd position inThe Best Incubator Award Competition in the category of “The Best In- ternationally Connecting Incubator 2011”. Can you see any strong trend influencing the biotechnology sector? There are many such trends. Much de- pends on the specific area. In the environ- mental protection area, new waste water treatment methods are most remarkable. In the chemical industry, the more envi- ronmentally friendly and more economical syntheses of substances, in healthcare, the area of molecular diagnostics, and in the power industry, the bio fuels issue, among many others, are noteworthy. Perhaps a general trend is the gradual penetration of biotechnologies into other branches of industry. Nanotechnologies with Support Nanotechnologies, too, have undoubtedly a very important role to play in the South Moravia Region, where the most important firms in the area of electron microscopy are represented, most of which have their own development centres. They could not exist there if it were not for the strong support provided to them by different research in- stitutions based in Brno, such as the Tech- nical University, Masaryk University, and INSTITUTE OF SCIENTIFIC INSTRUMENTS OF THE ACADEMY OF SCIENCES OF THE CR TheInstituteofScientificInstrumentsoftheAcademyofSciencesCR(ÚPTAVCR),togetherwiththeInstituteofElectrotechnology, Faculty of Electrical Engineering and Computer Science at theTechnical University in Brno, has obtained agrant of CZK 31 million (approx. EUR 1.24 million) for Human Resource development. Thanks to the grant, the well-known electron microscopy expert, Vladislav Krzyžánek, who until recently worked in Münster, Germany, is returning to Brno after 12 years. In addition to the return oftheCzechscientist,thegrantwillmakeitpossiblefortheInstitutetoorganiseeducationalseminars,inviteforeignscientistsand promote collaboration with the academic and industrial spheres. Collaboration has already been established with the University ofWestern Australia, the NanyangTechnological University in Singapore and another three leading foreign scientific workplaces. As regards the industrial sphere, ÚPT AV CR will collaborate, for example, with the firms of Solartec, BVT Technologies and De- long Instruments, a.s. The Institute of Scientific Instruments devotes itself mainly to research in the area of magnetic resonance, electron microscopy, the use of lasers and biosignal measurement and processing. Last year, the Institute started building anew nanotechnologyresearchlaboratory.Theproject,calledApplicationandDevelopmentLaboratoriesofAdvancedMicrotechnologies and Nanotechnologies (ALISI), will cost CZK 433 million (approx. EUR 17.3 million). About 85% of the amount was granted by the EuropeanUnion.Moreatwww.isibrno.cz/ the Institute of Scientific Instruments of the Academy of Sciences of the CR (see box). The mission of the South Moravia Innova- tion Centre is to give efficient support to starting and developing innovative firms. JIC also creates a partnership of universities and research institutions with industry, the aim of which is to maximise the benefits of Research and Development at regional and national levels. In this respect, an impor- tant role is played by Innovation Voucher projects (instrument of supporting col- laboration between enterprises and scien- tific and research institutions) and the 120 Seconds Networking project for innovative firms, which have already helped hundreds of firms and research institutions in their ef- forts to cooperate. In addition, from 13th March to 2nd May, the South Moravia In- novation Centre is organising its 4th call for Innovation Voucher applications. Firms, re- gardless of their size, can apply for grants of up to CZK 100 000 (approx. EUR 4 000). For the first time this year, innovative companies from all over the world can apply for grants. More information can be found on the sites of the project at www.inovacnivouchery.cz.

| 1 6 I N V E S T M E N T Photo:FNUSA-ICRCarchives New International Centre for Applied Medical Research A new international research and educational centre focused on Cardiology and Neurology is being built in Brno with financial assistance from the European Union. The Centre, which will cost CZK 4.5 billion (approximately EUR 180 mil. or USD 240 mil.) to build and oper- ate for the first 10 years, is a strategic project of the Czech government and will be fully operational in late 2012/early 2013, although the majority of research and educational pro- grammes have already started. The Centre is being built by St. Anne´s University Hospital in Brno, in cooperation with researchers and physicians from leading foreign and domestic universities, research centres, and hospitals, as well as medical technology and pharmaceuti- cal companies. Medical technologies, pharmaceuticals and biotechnologies rank among the most dynamic sectors of the Czech economy. The International Clinical Research Centre at St. Anne’s University Hospital (abbreviation FNUSA-ICRC) is therefore a strategic project of the Czech Government and the Ministries of Health and Education and is seen as one of the key projects in the advancement of the knowledge society in the Czech Re- public. The goal of the Centre is to carry out cutting-edge medical research, disseminate results of research into everyday use with minimal delay, provide high-quality medical care and ensure the continuing education of medical professionals at all levels. Close International Collaboration The basis of the activities of FNUSA-ICRC is the multidisciplinary collaboration of aca- demic institutions and industrial partners. The idea of the Centre grew from the highly successful long-term cooperation between researchers and physicians from St. Anne’s Hospital and their colleagues abroad, par- ticularly from the renowned Mayo Clinic in the USA, which started nearly 10 years ago. FNUSA-ICRC is being planned in collab- oration with colleagues from a number of foreign organisations, such as the Mayo Clinic (USA, the main partner), the Min- nesota Partnership for Biotechnology and Medical Genomics (USA), University Col- lege London (UK), the Medical University of Gdansk (Poland), the University of Mi- lano (Italy), the University of Minnesota (USA), as well as Czech partners, including Masaryk University, the University of Veterinary and Pharmaceutical Sciences Brno, the Brno University of Technology, the Czech Technical University (Prague), and the Institute of Scientific Instru- ments of the Academy of Sciences of the Czech Republic. Nearly 40 Czech and for- eign companies, such as Sanofi-Aventis, St. Jude Medical and GE Healthcare, have also expressed their interest in collabor- ative research and will participate in vari- ous projects. Close cooperation between FNUSA-ICRC and leading academic and research part- ners abroad will make it easier to involve theCzechRepublicininternationalprojects of academic and industrial research and international educational programmes. FNUSA-ICRC and its Czech partners will also gain access to the latest development in medical sciences and biotechnology, as well as to the most modern diagnostic and therapeutic methods and technolo- gies. Short- and long-term stays of leading foreign specialists in FNUSA-ICRC in Brno and internships of Czech researchers and physicians at foreign partner organisations are also of critical importance for the im- provement of the quality of Czech medical research and education. The International Clinical Research Centre at St. Anne’s University Hospital is a strate- gic project of the Czech Government and the Ministries of Health and Education

1 7 | N A N OT E C H N O LO G Y, B I OT E C H N O LO G Y, M E D I C A L , O P T I C A L , A N D M E A S U R I N G D E V I C E S Novel and Unique Research Concept FNUSA-ICRC is based on a novel logistics of research, based on the so-called dynamic international research teams composed of Czech as well as international experts from different fields. These teams will be estab- lished for each individual project carried out by FNUSA-ICRC and will consist of leading specialists from different countries and differ- ent fields, who will contribute to the success of the relevant project. The teams will have at their disposal a unique system of flexible research laboratories and it will be possible to adjust the structure and activities of the rele- vant laboratory to the specific project. Finally, the FNUSA-ICRC system of research project administration will allow the Centre to con- centrate its entire intellectual and technolog- ical potential on particular research projects. Jointly, the dynamic research teams, the flex- ible research laboratories, and the research project administration system will allow FNUSA-ICRC to carry out research projects more efficiently than existing general clini- cal research centres. It will also be possible to carry out projects which previously could not be undertaken due to the high demands on human and technological resources. Research Areas The primary focus of the FNUSA-ICRC is re- search in the fields of Cardiology and Neurol- ogy, with possible overlaps into other fields. Resuscitation of a“dead“ heart which has suffered a heart attack, development of an artificial heart, cure of sleep apnoea (a sleep disorder involving abnormal pauses in breath- ingduringsleep):theseareexamplesofthere- search projects currently being carried out by specialists from FNUSA-ICRC. The research ac- tivities of FNUSA-ICRC consist of two main re- search programmes, each of which is divided into several sub-programmes, and a shared multi-disciplinary support platform for experi- mental medicine and biotechnologies which provides support to research teams and re- search projects. The Cardiology programme focuses on research in the fields of cardiovascular and transplant surgery as well as diagnostics and therapy of cardiovascular diseases, such as the development of novel technologies and methodologies for the diagnosis and treatment of ischaemic cardiomyopathy, heart failure, and cardiac arrest, and the area of heart transplantation, including the utilisation of biotechnologies and nano- technologies. One of the sub-programmes is focusing on the development of innova- tive top-quality imaging technologies. An- other sub-programme is focused on the development of innovative methods for the prevention of cardiovascular diseases. The Neurology programme focuses on the development of new technologies and meth- ods for the prevention, early diagnosis and treatment of cerebrovascular diseases includ- ing stroke, as well as dementia, Alzheimer’s dis- ease, and multiple sclerosis. One of the priority areasisthedevelopmentofadvancedcompu- ter systems and other tools for experimental imaging of the central nervous system and their application in diagnosis and treatment. Largest Biomedical/Biotech Cluster in Central Europe One of the goals of FNUSA-ICRC Brno is to cre- ate the largest biomedical/biotech cluster in Central Europe. The cluster will be formed by establishing links between FNUSA-ICRC and the Masaryk University campus in Brno-Bohu- nice, the Cardiovascular Animal Centre of the Veterinary and Pharmaceutical University in Brno, research centres of the Czech Academy of Sciences in Brno, and the Central European Technology Institute - CEITEC. The cluster will be able to carry out even the most demand- ing research projects within one city, from ba- sicresearchtopre-clinicalandclinicalresearch, withthegoalofdevelopingnewtechnologies, advanced materials, and new methodologies to improve human life and the quality of life. Working to Create the Future of Medicine When fully operational, FNUSA-ICRC will have some 420 staff and more than 60 external collaborators. The total budget to build the Centre and operate it for the first 10 years is CZK 4.5 billion (approximately EUR 180 mil. or USD 240 mil.) - this sum also includes the costs of carrying out Research and Develop- ment. Some 60% of the budget will be cov- ered by a grant from the Structural Funds of the European Union, which was awarded to FNUSA-ICRC in June 2011.The remaining part of the budget will be covered by grants from the state budget of the Czech Republic, the budget of the South Moravia Region, internal resources of St. Anne’s University Hospital and cooperation with industrial companies. The construction of the first new building for the Centre started in early 2011 and its completion is scheduled for mid-2012. Con- struction of the second building is planned for 2013-2015. The Centre also uses various premises and technologies of St. Anne’s Uni- versity Hospital and its partners. The major- ity of the administration and research teams are already working. The first internships of Czech researchers and the first visits of for- eign specialists from partner organisations to Brno have also already taken place. FNUSA-ICRC will be a major milestone in the development of medical research and education in the Czech Republic and will have a major impact on an increase in the quality of medical care in the Czech Republic and beyond, in the whole European Union.

| 1 8 R E S E A R C H A nanotechnology research centre with the most modern equipment in Central and East- ern Europe was opened in Prague’s Libeň Dis- trict in October 2011. The Centre for Analysis of Functional Materials (SAFMAT) will, besides conducting material and nanotechnology re- search, function as a nursery for talented scien- tists of the Academy of Sciences of the Czech Republic (ASCR). SAFMATfeatureslaboratorieswiththemost modern technical equipment. The Centre’s research results may find application in, for example, medicine, nuclear energetics or the automotive industry. Researchers may utilise, for example, instruments for studying the chemical composition and structural proper- ties of materials in nanometric resolutions, or a spectrometer that allows them to measure the influence of structure on the functional properties of materials. This allows for the analysis of defects in semiconductors or mul- tifunctional materials. NanoESCA Microscope –SAFMAT’s Pride As a part of its research activities and collabor- ationwithotherscientificinstitutions,theASCR will focus on material research in the area of nanotechnology and on the education, espe- cially of postgraduate students, in cooperation with universities, mainly the Faculty of Mathe- matics and Physics at Charles University and the Czech Technical University. Another focus group consists of business entities oriented towards research and development. This will create favourable conditions for the develop- ment of capacities, research infrastructure and human potential in the area of nanotechnol- ogy. The use of new instruments by interested parties from among business entities will help them achieve greater competitiveness. Meas- urements realised for these firms will ensure the innovation of their production and the in- troduction of completely new products. The SAFMAT project was started in March 2010, and a new building with laboratory and office space was built for it, financed by the ASCR and EU structural funds. The final ap- proval of the building took place at the begin- ning of 2011.The costly FT-EPR and NanoESCA instruments were installed during the summer of 2011. SAFMAT is especially proud of the su- per-modern NanoESCA electron microscope, which will be used for material analysis. It is capable of distinguishing the smallest surface details of various materials, e.g. metals. It can provide data about the chemical composition of sediments on these surfaces.This is very im- portant for a number of industries, including turbine manufacture. SAFMAT Provides Top Conditions INDUSTRIAL SAFMAT PARTNERS INCLUDE THE FOLLOWING COMPANIES: ČEZ,a.s.,willcollaborateintheresearchofmaterialsfornu- clearpowerengineering.Theresearchwillbefocusedmainly on the corrosion and segregation of elements that lead to degradationandundesiredchangesinthemechanicalprop- ertiesofindividualpartsofnuclearpowerplants,influencing their durability and safety in adecisive way. With the aid of theNanoESCAinstrument,itispossibletoexaminethestruc- ture,spatialdistributionandchemicalcompositionofdefects on ananometric scale, which was hitherto impossible. Joint researchinthisfieldwouldproceedincooperationwithČEZ, a. s., subsidiaries and with other companies concerned with theseproblems.Theseinclude,inparticular:NuclearResearch InstituteŘež,a.s.,UJPPRAHA,a.s.,andResearchandTesting InstitutePlzeň,s.r.o. HVM plasma, s. r. o., is a company dealing in the de- velopment and production of special thin-film coatings for the automotive industry. The company is interested in collaboration in research and development of meth- ods suitable for the analysis of nanostructured thin-film coatingsandtheunderlyingoptimisationofplasmadepo- sitionprocesses.Thecompanyisalsoshowinganeminent interest in the metrology of thin films. Crytur, a. s., plans to utilise the FT-EPR instrument for research into new scintillators and crystals for optics and opto-electronics. UJP Praha, a. s., is interested in collaboration in the research of the structure of various types of steels for nuclear power engineeringwiththeaidoftheNanoESCAinstrument. VakuumPraha,s.r.o.,–activeinthefieldofdevelopment and production of vacuum systems – has shown interest in utilising the NanoESCA instrument to analyse materials and their surfaces. Research in the area of surfaces of ultra-vacu- umsystems,XHVsystemsandionicsorptionpumpsisofma- jorimportinthedevelopmentofthiscompany’sproducts. Polovodiče, a. s., is interested in utilising NanoESCA for thevisualisationofthespatialdistributionofelementson the surfaces of semiconductor devices and in the research of new technologies and properties of doped silicon ma- terials using the FT-EPR instrument. Application of these results in production is of fundamental importance to the semiconductor industry in the Czech Republic.

1 9 | N A N OT E C H N O LO G Y, B I OT E C H N O LO G Y, M E D I C A L , O P T I C A L , A N D M E A S U R I N G D E V I C E S CEITEC Will Also Focus on Microtechnologies Photo:ČEZcompanyarchives,CEITECarchives The Central European Institute of Technol- ogy, CEITEC, is being set up in Brno, with funds of CZK 5.2 billion acquired together by Brno universities and research institutes fromtheOperationalProgrammeResearch and Development for Innovations, for the establishment of a European centre of sci- entific excellence. The institute, which will interconnect research in life sciences and technical fields, will be utilized by up to 600 scientists and by over 1200 students, and also by Czech and foreign companies. It will also help the existing basic and ap- plied research in the whole of the Czech Republic to achieve top levels. Multi-field CEITEC is in fact the first type of a scientific centre in the Czech Republic to integrate research and development in the fields of life sciences, advanced ma- terials and technologies in such a large range. The research is divided into seven programmes: Nanotechnologies and Microtechnologies, Advanced Materi- als, Structural Biology, Genomics and Proteomics of Plant Systems, Molecular Medicine, Brain and Mind Research, and Molecular Veterinary Medicine. For exam- ple, the Advanced Nanotechnologies and Microtechnologies programme will focus on nanotechnologies of materials and structures to be used in nanoelectronic and nanophotonic applications. This par- ticularly involves research into 2D-0D na- nostructures produced by lithographic (top-down) methods and self-organising (bottom-up) methods. Specifically, sci- entists will study semi-conductor, metal- lic and magnetic nanostructures, oxide superconductors and magnetics, nano- tubes, nanofibres, supramolecular and na- noelectronic elements beyond the limits of Moore’s Law, etc. New modern laboratories of an area of 25000 sq. m will grow in the University Campus of Masaryk University in Brno- Bohunice and in the Brno University of Technology Campus “Pod Palackého vrchem”. Almost 700 special instruments and unique facilities will be selected and acquired based on the specific needs of scientific teams. The research will focus on for instance the production of a subder- mal chip, which will measure the patient’s life functions and inform the doctor about them from a distance, the production of biosensors, which will be able to discover an earlier stage of an illness, modification of surfaces for a faster adhesion of dis- turbed nerve fibres or the production of “SMART materials” built into planes, which will be capable of reporting their defects. They will also examine the safety of foods in the market, look for new ways of vac- cination or develop new methods of fast identification of bacteria, which will en- able the doctors to choose the most suit- able antibiotic for the treatment of the patient within a few minutes. These re- searches and others will make it possible for practicing doctors to diagnose for in- stance a tumour, infectious, neurotic, and other serious illnesses more easily. Investment in the Future of the Whole Region The state-of-the-art instruments and fa- cilities will also be utilised by scientists and companies from the whole of the Czech Republic and abroad. Pharmaceutical and engineering companies are already making enquiries in research, education of experts, and the renting of facilities worth more than CZK 1.6 billion. The uniqueness of the centre is, apart from the integration into the international research network, based on the system of management stemming from the experience of the most significant world research institutions. The manage- ment and setting of the project is assessed by important foreign experts according to strict international standards; the internal language is English. „We are already occupying research teams and key managerial positions by rec- ognized foreign experts. We have started cooperation with the most significant glo- bal institutes, the interest to work in CEITEC has been expressed by world experts as well as successful Czech scientists, who will finally have a place to come back to from abroad,“ Tomáš Hruda, the Executive Director of CEITEC, introduced the visions of the centre. The following participate in the setting up of the centre of excellence: Masaryk University, the Brno University of Technology, Mendel University in Brno, the University of Veterinary and Pharmaceuti- cal Sciences in Brno, the Institute of Phys- ics of Materials of the Academy of Sciences, and the Veterinary Research Institute. More at www.ceitec.eu Multi-field CEITEC is in fact the first type of a scientific centre in the Czech Republic to integrate research and development in the fields of life sciences, advanced materials, and technologies in such a large range

| 2 0 E D U C AT I O N Nanotechnologyhascometobeconsidered a sector of the future. No wonder a number of Czech higher learning institutions and universities have included this scientific and technical subject in their curricula. The first Bachelor’s and Master’s Nano- technology degree courses taught in Czech and English were opened at the Technical University in Ostrava in 2007. The Bachelor’s degree courses provide students with the basic knowledge of Mathematics, Physics, and Chemistry and an overview of Nanosciences and Nanotechnologies. Stu- dents for the Master’s degree get a more profound knowledge of the electronic structure of materials, their optical and magnetic properties and they learn how to use new experimental methods in chemi- cal and physical specialisations. The gradu- ates may continue their studies to acquire a Doctoral degree. Technical University Runs Courses for the Next Millennium In 2009, Nanotechnology courses were opened by the Brno Technical University’s Institute of Physical Engineering (ÚFI VUT) Photo:TechnicalUniversityinLiberecarchives Nanotechnology Degree Courses Are Offered at a Number of Czech Universities in response to the need for the education of specialists for this new sector. It opened a three-year Bachelor’s degree course and a follow-up two-year Master’s degree course in Physical Engineering and Nanotechnol- ogy. In the past few years, the Institute has devoted much of its activities to Nanotech- nology research and tuition. It has worked on a number of projects involving Nano- technologies and extended its collabor- ation with firms engaged in the manufacture of diagnostic equipment for this new sector (e.g. ON Semiconductors Czech Republic, Tescan, s.r.o. and FEI Czech Republic). The opening of a class 100 000 clean room (i.e. 100 000 dust particles sized less than 0.5 micrometres per cubic foot – the usual level being approx. 20 million) was very impor- tant for Nanotechnology research. ÚFI also has the use of a unique tunnelling atom mi- croscope, which was developed there. UJEP University at Ústí nad Labem Opens Applied Nanotechnology Courses In 2011, Jan Evangelista Purkyně Univer- sity (UJEP) at Ústí nad Labem opened a new course of study concerned with the practi- cal applications of Nanotechnologies in Material Engineering, the development of new materials by chemical and physical methods. It is a three-year Bachelor’s degree course, followed by a course for the Master’s degree. The applied Nanotechnology pro- gramme provides students with the basics of the Natural Sciences and an overview of technologies and materials, their prepara- tion and study of their physical and chemi- cal properties. As part of their studies for the Bachelor’s degree, students are offered the possibility of joining one of the Faculty’s re- search programmes. New Courses at the Liberec Technical University In the academic year 2009/10, the Tech- nical University in Liberec (TUL) started a new inter-branch Nanotechnology pro- gramme focusing on Nanomaterials. The programme comprises of a three-year Bachelor’s degree course and a follow- up two-year Master’s degree course. The courses are run by the Faculty of Mecha- tronics and Interdisciplinary Engineering The team of David Lukáš at a technology fume hood.The equipment is used in experiments with parallelised nanofibres for the trapping of branches from radon decay and simultaneous experiments with the detection of RTG radiation.

2 1 | Studies, but the tuition is provided by four faculties (Faculty of Mechanical Engineer- ing, Faculty of Textile and Faculty of Sci- ence, Humanities and Education, in addi- tion to the Faculty of Mechatronics) and the Institute of Physics of the Academy of Sciences. The interest in enrolment in the courses is great, and expectations are that this specialisation will attract increasing number of students as the need of firms to employ graduates with this qualification grows. The fact that the interest in these studies is focused on the Liberec University is not accidental. It is the University’s Non- wovenTextiles Department, which became famous for the unique production process, which has made it possible to manufacture Nanofibre textiles on an industrial scale. This technology has been patented and prepared for its practical use by the Liberec company named Elmarco, which has been the University’s partner for many years in its development efforts. Today, the firm is the first in the world to manufacture and sell equipment producing Nanofibre materials, which go under the trademark of Nano- spider TM. TUL is planning to continue the development of this forward-looking branch: in 2011 the University began to realise a project for the innovation of its Nano- materials programme of study. In addition, this three-year project has been supported by the European Union with an amount of more than EUR 10 million from the Education N A N OT E C H N O LO G Y, B I OT E C H N O LO G Y, M E D I C A L , O P T I C A L , A N D M E A S U R I N G D E V I C E S The Institute of Plasma Physics of the Acad- emy of Sciences of the Czech Republic has been granted an allocation from the European Structural Funds for its optics facility in Turnov, which enables it to build a regional research centre for special optics and optoelectronic systems – TOPTEC. The main objectives of the Centre are research and development in optics on an excellent level, expansion and modernis- ation of the existing research and develop- ment capacities (equipment and research team), extension of collaboration with industry, training of top young specialists, participation in international projects and development of cooperation with univer- sities. The vision of the Centre is, by 2018, to become one of the five best research and development centres focused on ul- tra-precision and special optics in Europe and to participate in prestigious inter- national networks and consortiums. The Turnov district was one of the main cen- tres of optical research in the Czech Re- public in the past – the local Monokrystaly and Dioptra companies were well known. Thus, the TOPTEC Centre can carry on in this tradition and, at the same time, it wishes to help revive the interest in optics in the area on a new, significantly higher level, and thus return Turnov to the map of European optics’ locations. TOPTEC Centre for Special Optics and Optoelectronic Systems forCompetitivenessOperationalProgramme. Collaborating in the project are important re- search institutions and firms, such as the In- stitute of Physics of the Academy of Sciences of the CR and the firms of Elmarco Liberec, Pegas Znojmo and Aquatest. By 2013, the Nanotechnology pro- gramme, particularly courses for the Mas- ter’s degree, will be taught in English, in addition to Czech, and all the study mate- rials will also be available in English. The internationalisation of tuition will signifi- cantly raise the Liberec University’s pres- tige. Its high standing is also supported by the fact that foreign partners are par- ticipating in the realisation of the Uni- versity’s project and that the University is cooperating with German, Belgian, Italian, and French universities and research insti- tutes. Thanks to EU support, in September 2012 the Technical University will be able to launch a new subject, “Innovation and Business in the Area of New Technologies”. The lecturers will be experts with practi- cal knowledge and experience in starting new businesses in the area of new tech- nologies, in particular Nanotechnologies. Some of them, such as the Liberec com- pany of Elmarco, is collaborating with the University on a long-term basis. Fine Mechanics Hand in Hand with Optics The Centre will include laboratories for X-ray and crystal optics research, an adap- tive optics laboratory, and a laboratory for the research of holographic optical ele- ments. Fine Mechanics research and devel- opment is traditionally linked with precision and special optics. Experts will not only design mechanical components and struc- tures, e.g. parts of satellites, but also analyse their properties, and it will be possible to manufacture the components on high pre- cision CNC machine tools with temperature compensation. The AS CR Plasma Physics Institute also plans to carry on the tradition of design and manufacture of very precise prototype components used as calibres of dimensions or the quality of lapping. More information on the TOPTEC project can be found at www.toptec.eu/. Nanofibre layer on a universal frame demon- strates the possibilities of nanofibre deposi- tion and orientation on special collectors.

| 2 2 S U R V E Y HOMMEL CS s. r. o. www.hommel-etamic.cz Turnover: (in EUR): 1 600 000 Number of employees: 6 What recent successes can your company boast of? HOMMEL CS s.r.o is known in the measuring instruments market as a sales and servic- ing section of the German measuring in- struments manufacturer, HOMMEL-ETAMIC GmbH, formerly HOMMEL WERKE GmbH. That firm operated on the Czech market for many years in the era of the emerging mod- ern engineering firms of ŠKODA, TATRA, and LIAZ, which specialized in precision engineer- ingproduction.Itishardtosingleoutjustone project as the most important; nevertheless, one of our undeniable great achievements was our contract with ŠKODA AUTO. ŠKODA is undoubtedly an impor- tant car manufacturer, not only at the national level, but also on the European scale. Winning an order from such a client means making a good offer made to measure for the needs of that client, winning his confidence and safeguarding it by every- day good work.To sum it up, this means win- ning confidence by providing good services. Howareyoufaringinforeignmarkets?Which territoriesareyourmainexportoutlets? Our firm is designed to serve the Czech and the Slovakian markets. Our export market is therefore Slovakia. For the Slovakian clien- tele, we have prepared service projects in the framework of our services for the Czech domestic market. Are you noticing any strong trends influencing your branch of production? Theautomotiveindustryisthekindofshowcase oftheentireengineeringindustry.Therearesev- eral trends that can be noticed in this sector: demand is growing markedly for well-worked parts.Theautomotiveindustryisseekingpoten- tialsuppliersintheCzechRepublicofhighqual- ity parts in the sense of well-worked sections. Another trend is the unequivocally growing influence of financially strong firms investing in moderntechnologies,wherebytheyareprepar- ingapositionforthemselvesamongcustomers. The result is that manufacturers need not nec- essarily be giant firms, and smaller firms with flexible production will have agood chance of winning contracts. The decisive aspects are economicconsiderationsandflexiblereaction. ZPA EKOREG spol. s r.o. www.zpaul.cz What recent successes can your company boast of? ZPA EKOREG spol. s.r.o. is a traditional Czech manufacturer of measuring and regulation equipment, which has been in the market since 1994. Our core product portfolio in- cludes temperature regulators and limiters, and temperature sensors. We are proud of having strengthened our leading position in the pressure regulator market and boosted our sales by increasing our production of pressure switches for domestic water- supply pumps and compressors. While some rival firms offer cheaper measuring and regulation equipment than we do, the advantages of ZPA EKOREG products are especially that they have proved their qual- ities in heavy-duty conditions, including unfavourable climatic situations. Our clients also appreciate their reliability and defect- free operation, even after decades of use in heavy industrial working conditions. In ad- dition, we carry out the servicing with the use of our own parts. Howareyoufaringinforeignmarkets?Which territoriesareyourmainexportoutlets? We export mainly to Slovakia, followed by Hungary and Poland. Are you noticing any strong trends influencing your branch of production? A negative trend in particular is China’s ex- pansion to the EU. Chinese production and the import of cheap goods in our branch re- duce the marketability of our equipment, al- though Chinese products compete with us only in price, not in quality and service life. Useful Information SELECTED TRADE FAIRS IN THE CZECH REPUBLIC PRAGODENT 20th International Fair of dental apparatus, in- struments, surgery equipment and services Date: 11 – 13 October 2012 Place: Praha - Výstaviště Exhibition Grounds www.pragodent.eu MEDICAL FAIR BRNO / REHAPROTEX International Fair for medical technology, re- habilitation, and healthcare Date: 16 – 19 October 2012 Place: Veletrhy Brno, a.s. www.bvv.cz/medical-fair-brno/ INTERESTING WEBSITES www.gate2biotech.cz/ Gate2Biotech is a portal bringing to- gether the biotechnological community in Central Europe. It maps out all that is new in the area of biotechnologies and serves as a bridge linking the scientific and research sector with the commercial world. www.nanotechnologie.cz The web has set itself the aim to inform those interested primarily about the lat- est developments in the area of nano- technologies in the Czech Republic. www.nafigate.com This website features the most up-to-date information, patents, ideas, experiences and projects from the world of nanofibres. The aim of the project, in which experts from the most prestigious world universi- ties and firms participate, is to create a plat- form that will support the innovation proc- ess and help place new products using nanofibres on the market. HOMMEL CS s.r.o.

ZPA ZPA EKOREG spol. s r.o. We are traditional manufacturers of meas- uring and regulating equipment and have been in the market since 1910. Our core pro- duction programme includes pressure and temperature regulators and limiters and pressure switches. We supply a wide range of temperature sensors, measuring resis- tors, current and voltage transmitters and power inverters, bimetal thermal protec- tors, energy posts and ultrasonic cleaners. The quality of our products is guaranteed by ISO 9001 quality certification. Pressure and temperature regulators and limiters for pressure ranges from -80kPa to +4MPa and for temperature rangesfrom -40o C to +210o C including Ex Three-phase pressure switches for com- pressors and water-supply pumps - rang- es from 0.08 MPa to 0.9 MPa Temperature sensors Pt 100, 500, 1000, Ni 1000 for temperature ranges from -40o C to+600o C, with resistor, current or voltage outputs Resistance-to-current transmitters, resistance-to-voltage transmitters for temperature sensors Pt 100, for mounting to heads, rail (DIN) or walls Bimetal thermal protectors BTK for temperature ranges from 45o C to 120o C – energy post – ultrasound washers Wound measuring resistors Pt 100, layer measuring resistors Pt 100, 500, 1000, Ni1000/5000ppm/o K,Ni1000/6180ppm/o K ZPA EKOREG spol. s r.o. Děčínská 55, 400 03 Ústí nad Labem Czech Republic Phone: +420 475 246 335 (336) Fax: +420 475 531 073 E-mail: sales@zpaul.cz www.zpaul.cz ISO 9001

HOMMEL ROUGHNESS MEASUREMENT | FORM & CONTOUR MEASUREMENT | OPTICAL MEASUREMENT WE MEASURE THE WORLDWE MEASURE THE WORLD www.hommel-etamic.cz HOMMEL CS s.r.o. Pražská 3259, 415 01 Teplice Phone: +420 417 535 160 E-mail: info@hommel-etamic.cz The most demanded newcomer in the market! The most demanded newcomer in the market!