Based on the Council Regulation No 2137/85 establishing a European Economic Interest Grouping (EEIG). It is effective from 1 July 1989, with the exception of Articles 39, 41 and 42 which entered into force as from the entry into force of the Regulation. In the Czech Republic effective from 1 May 2004.
The basic purpose of regulation is to facilitate cooperation between entrepreneurs from different Member States (no need to set up a company under national law, reporting directly to European law).
EEIG differs from cooperatives and commercial companies in the CR by activity, which must meet the following conditions:
1) Positive definition of the activity:
- the activity is intended to alleviate or develop the economic activities of its members, as well as to improve and increase the results of those activities,
- the association's activities must be related to the economic activities of its members,
- activities of the association may be only ancillary activities in relation to the economic activities of its members
2) The negative definition of the purpose of the association:
- purpose of the association is not to achieve its own profit, but to support profit growth of members, the association can generate profit, but it should be divided among the members,
- association may not exercise executive or supervisory power over the actions of its members or other business activities (can not be controlling person within the meaning of § 66a of the Commercial Code), an association may exercise in relation to its members and other persons EEIG coordination activities.
The Association can not carry out the activity instead of its members, but at the same time its activity can not be independent of the activities of its members. Eg. association whose members are lawyers, can not practice law itself but only ancillary activities, such as organizing training, clients seek etc. Most EEIG were founded in services, 90% are private sector.
The association may or may not be a legal entity, it depends on the legislation of a Member State, it is always possible participant in substantive and procedural relationships.