The Court of Appeal granted the appeal of Agentura NKL s.r.o.
Agentura NKL s.r.o. hereby announces and informs the general public and its business partners that the Municipal Court in Prague, as the court of appeal, granted the appeal filed by Agentura NKL s.r.o. on May 6, 2025 and overturned the judgment of the District Court for Prague 1 in the matter of imposing the obligation to negotiate the conclusion of an amendment to the lease agreement. The case is thus returned to the court of first instance, which, in addition to criticizing fundamental procedural defects, was ordered to conduct a proper and complete examination of evidence.

Statement of Agentura NKL s.r.o. regarding the lease of Žofín Palace

Agentura NKL s.r.o. has been leasing Žofín Palace under a Lease Agreement concluded with the Municipal District of Prague 1 on 29 July 1994, as amended, particularly as amended by Amendment No. 8, which in its Article 7.2 provides a binding option to extend the lease for an additional 10 years, provided that Agentura NKL s.r.o. applies for the extension of the lease no later than 5 years before the expiry of the lease, which was to occur on 31 December 2008. Agentura NKL s.r.o. submitted its application for the extension of the lease within the specified period, which the Municipal District of Prague 1 acknowledges as undisputed, and the lease has thus been extended for the period from 1 January 2025 to 31 December 2034. Agentura NKL s.r.o. is therefore a rightful and valid tenant of Žofín Palac, holding the right to organize all contracted events on its premises until the specified date. The Municipal District of Prague 1 has challenged this right of Agentura NKL s.r.o., and court proceedings are currently pending before the District Court for Prague 1. Until the conclusion of these proceedings, neither the Municipal District of Prague 1, nor any other entity has no right to prevent the use of Žofín Palace by Agentura NKL s.r.o., except through court proceedings.
The public tender announced by the Prague 1 Municipal District for a new tenant of Žofín Palace lacks any justification, as the selected entity, Zátiší Catering Group a.s., has failed to meet the essential qualification requirements set by the Prague 1 Municipal District. The invalidity of the public tender and the invalidity of the lease agreement by and between the Prague 1 Municipal District and Zátiší Catering Group a.s. are currently the subject of other ongoing proceedings before the District Court for Prague 1.
In view of the above, Agentura NKL s.r.o. is not obliged to vacate the premises of Žofín Palace by 15 January 2025, as claimed by the Municipal District of Prague 1 in its declarations, as Agentura NKL s.r.o. considers itself the rightful and valid tenant of Žofín Palace. The Municipal District of Prague 1 is harming the interests of Agentura NKL s.r.o., and the interests of its business partners as well as the public interest by creating legal uncertainty and damaging the reputation of Agentura NKL s.r.o. through its media statements. On the other hand, Agentura NKL s.r.o. continues to pay the rent for the use of the Žofín Palace premises to the Prague 1 Municipal District in due and timely manner, ensures the upkeep of the premises and manages its operations. Meanwhile, the Prague 1 Municipal District has failed to take any steps to facilitate a seamless takeover of Žofín Palace to ensure the long-term and recurring continuation of cultural and social events held at the venue.
Regardless of the outcome of the court proceedings, Agentura NKL s.r.o. points out that the vacating and handing over of Žofín Palace are, under the Lease Agreement, conditional upon the obligation of the Municipal District of Prague 1 to purchase from Agentura NKL s.r.o. all furniture and all equipment firmly affixed to the building, which Agentura NKL acquired at its own expense during the lease term, at a price set by an expert jointly selected by both parties from an official list of experts.
Pursuant to Article 8.7 of the Lease Agreement, the deadline for handing over the premises of Žofín Palace shall be extended by the period during which the Municipal District of Prague 1 will be in delay in taking over the aforementioned furniture and equipment. In this respect, Agentura NKL s.r.o. points out that the Municipal District of Prague 1 has not undertaken the above-described steps laid down in the Lease Agreement to date, so its claim that Agentura NKL s.r.o. is obliged to vacate the premises of Žofín Palace cannot stand under any circumstances.
Agentura NKL s.r.o. summarizes the above by stating that, at least for the duration of the ongoing litigations, Agentura NKL s.r.o. will use the premises of Žofín Palace as it has done to date, and no third party has the right to interfere with this right, except through court proceedings. This also applies to the contracted events scheduled to be held on the premises of Žofín Palace in 2025 and beyond. Agentura NKL s.r.o. therefore assures its business partners that it remains fully prepared to meet its obligations under the sublease agreements, as neither the Municipal District of Prague 1 nor Zátiší Catering Group a.s. has any right to interfere in the course of the contracted events in any way. Furthermore, it should be, at the very least, in the interest of the Municipal District of Prague 1 to ensure that the operation of the cultural monument of Žofín Palace continues without disruption at least until the aforementioned litigations are finally resolved.