DSIA Articles

ARTICLES OF THE DEFENCE AND SECURITY INDUSTRY ASSOCIATION OF THE CZECH REPUBLIC

The Association is a special-interest grouping of legal entities, established and existing pursuant to the provisions of Section 20 f to Section 21 (2) of Act No. 47 / 1992 Coll., the Civil Code, that engages in research, development, manufacture, trade and marketing services for military equipment and materials and security technology, registered with the District Office of the Municipality of Prague 1 on 11 September 1997 under registration No. 91 / 97.

I. Name and Registered Office of the Association

Name: Asociace obranného a bezpečnostního průmyslu ČR (AOBP ČR)

English name: Defence and Security Industry Association of the Czech Republic (DSIA CR)

Registered office: Prague 9 - Letňany, Beranových 130, postcode 190 00, Czech Republic

Mission: Contribute to the creation of ideal conditions for pro research, development, manufacture, trade and marketing services for military and security equipment and materials, and defend the specific common interests of the Association members, as well as their individual interests, unless they are in conflict with the common interests. These activities shall be carried out in accordance with the applicable legal regulations in force in the Czech Republic, the Principles of Cooperation between the State and the Defence Industry in the Czech Republic, as approved by Resolution No. 259 of the Czech government dated 15 March 2000, while respecting the security policy and the national defence strategy of the Czech Republic, and in consistence with the commitments of the Czech Republic arising from its membership in NATO and from its membership in the EU. The Association is independent of party and political interests and other related stakes.

II. Sphere of Activity

The sphere of activity of the Association shall cover in particular:

Promoting and defending the business and commercial interests of its members when negotiating with the Parliament and the government of the Czech Republic, the respective ministries and other public administration bodies, political parties and other national as well as international institutions, including foreign associations (societies, federations) with a similar focus of activity, and supporting the establishment of contacts between our and foreign business entities.
Supporting presentations of production plans and products as well as the participation of the Association members in development and modernization programmes of the armed forces and security corps and organisations of the Czech Republic and partner organisations in the EU and NATO.
Boosting the export capabilities of its members in the field of defence and security equipment and materials.
Organizational, economic and professional consulting.
Supporting and coordinating research, development, testing and services in the field of military and security equipment and materials in order to create conditions comparable to those prevailing in the European Union and NATO member states.
Promoting the general interests of research and development centres in grants and tenders aimed at the research and development of technologies to manufacture military and security equipment and materials.
Organizing training and promotion events for the benefit of its members.

III. Property Relations

The property of the Association shall consist of the annual membership fees, voluntary membership fees, access of wealth, donations, other items and values.
Paid-in, granted and acquired funds, other items and values shall become the property of the Association and shall be used to cover the costs related with activities of the Association.
The Association shall operate on the basis of a budget for the respective calendar year as approved by the General Meeting.
The Association shall keep accounts of the asset position and changes as well as of its income and expenditure. The economic activities and management of the Association shall be governed by the generally binding legal regulations. In order to check the management of the administered funds, an audit shall be carried out on an annual basis and shall be submitted to the General Meeting of the Association for information.
In order to raise additional financial resources and means in terms of Article II points 2, 4 and 7 of these Articles, the Association may establish and manage a business entity (company) whereas any revenue from such economic activity shall be used exclusively to cover the costs incurred in relation to the activities of the Defence and Security Industry Association of the Czech Republic.

IV. Admission and Termination of Membership

The membership in the Association shall be voluntary. Admission of a member shall always be decided on by the General Meeting.
Only a legal entity having its registered office in the Czech Republic or a registered sector society can become a full member of the Association.
The membership of the Association founders shall arise upon the payment of the annual membership fee on the date of the foundation meeting.
Full membership in the Association shall arise on the date of admission by the General Meeting and upon the payment of the membership fee for the respective calendar year in an aliquot part since the date of submission of the enrolment form. Upon admission, the new member must fill in and sign the enrolment form accompanied with a declaration to confirm its consent with Articles of the Association.
The membership in the Association shall be terminated by termination notice, expulsion or dissolution of the Association.
A member may terminate its membership in the Association by a notice with a three-month notice period, which shall commence on the first day of the month following after the month in which the member’s written notice of membership termination was delivered to the Association. Throughout the notice period, the member shall also be obliged to meet all its commitments and obligations arising from the membership in the Association. The General Meeting shall take note of the membership termination requests.
The General Meeting shall decide on the expulsion of a member, based on a proposal from the Presidium, on the following grounds:
I. Bankruptcy or other form of insolvency settlement was declared over the member in accordance with Act No. 182/2006 Coll., on Insolvency and Its Settlement Methods (the Insolvency Act), as amended, or with a regulation of a similar nature replacing the Insolvency Act, as the case may be, the member has entered into liquidation, or changed its sphere of activity, or lost its license and authorization to carry out activities in such a manner that these changes are fundamentally no longer in consistence with the conditions and objectives of the Association. The Association member shall be obliged to inform the Association without undue delay after becoming aware of the above facts;

II. The member is in delay with the payment of its membership fee for more than six months and it is beyond doubt that the member has been notified in writing of such delay by the Association at least two times with a thirty-day interval;

III. The member has repeatedly acted in a way that is in a sharp conflict with the objectives and principles of the Association’s activity or with the Principles of Cooperation between the State and the Defence Industry in the Czech Republic, or has in other ways damaged the interests of the Association.

A member may be expelled by the General Meeting pursuant to item III of the previous paragraph only if the member has been notified in writing of the actions in question and has been granted an adequate period of time to remedy the situation. As a rule, the discussion on the expulsion shall be in all cases preceded by a hearing of the member’s authorized representative.

The expulsion shall become effective upon the announcement of the voting results at the General Meeting.

V. Rights and Duties of Members

1. A full member of the Association shall have the right to:

Participate in the decision-making of the General Meeting as defined in these Articles, take joint decisions on the activities of the Association, and participate in other actions and events of the Association;

Promote its claims and views, thus influencing the shaping of the Association’s opinions;
Give its opinion on the activities of the Association bodies, submit its proposals for modifications and amendments to the Association’s founding documents, for convening the General Meeting, and nominations of candidates for the elections of the Association’s representatives;
Engage in the Association’ activities by working in expert commission, working groups, etc.;
Require the Association to provide or arrange for services arising from the sphere of activity of the Association;
Check the activities of the Association and participate in the results of its work.

2. A full member of the Association undertakes to follow these Articles and shall be obliged to:

Promote and explain the opinions and interests of the Association, if acting under the name of or identifying itself as a member of the Association;

Provide such information to the bodies of the Association as is necessary to accomplish the objectives within the sphere of activity of the Association;

If coming into contact with confidential information, undergo a security clearance in terms of Act No. 412/2005 Coll. on the Protection of Classified Information, and inform the Association about its result without any delay;

Cooperate with the Association to develop a detailed database of suppliers – tenderers in public procurement contracts, meeting the necessary and sufficient criteria as defined by the public administration authorities;

Show information openness in relation to the state, secure protection and handling of the information provided to the members, including information related to NATO projects and projects arising from the EU membership, in accordance with the level of their classification, in particular ensure that this information is not accessible to unauthorized persons;

Pay the fixed membership fees and contractual obligations owed to the Association in time;

Actively cooperate when fulfilling the mission and the activities of the Association arising from the Articles or from the resolutions of the General Meeting.

3. Every member of the Association shall be entitled to use the identification of “Member of the Defence and Security Industry Association of the Czech Republic” in standard commercial relations.

4. Every member of the Association shall be entitled to require the Association to ensure strict protection of data and information against misuse, and agrees with their use in consistence with the agreements concluded or to be concluded by the Association with public administration bodies, institutions or the European Union, the European Community or NATO.

VI. Bodies of the Association, Acting and Signing on behalf of the Association

1. The bodies of the Association shall consist of:

A. General Meeting

B. PRESIDENT

C. PRESIDIUM

D. EXECUTIVE DIRECTOR

E. COUNCIL OF DIRECTORS

2. The President, or the Vice-President of the Association or the Executive Director of the Association duly authorized in writing by the President, shall act on behalf of the Association. Signing shall be carried out in such a manner that the President or, during his/her absence, the authorized Vice-President of the Association or the Executive Director or another representative of the Association duly authorized in writing by the President, shall attach his/her signature to the name of the Association.

VII. Competence of the Bodies of the Association

A. General Meeting of the Association

1. The General Meeting shall be the supreme body of the Association, who also performs inspection tasks. The General Meeting shall consist of delegates representing every full member of the Association. For voting purposes, every member of the Association shall have one vote.

2. Regular General Meeting shall take place at least once a year by 30 June at the latest.

3. The General Meeting shall be convened by the Executive Director of the Association with written invitations sent to the registered offices of the Association members at least 20 days before the date of the General Meeting.

4. If the Executive Director of the Association fails to convene a General Meeting or if an extraordinary General Meeting needs to be convened to discuss an agenda item raised, the General Meeting can also be convened by the members who comprise more than 1/3 of all members of the Association, in the manner as described in paragraph 3 of this Article hereof.

The General Meeting shall particularly decide on:

- Admission and expulsion of a member;

- Amendments to the Articles;

- Membership or cooperation and/or merger with other entities;

- Approval of the budget;

- Approval of the annual report and the financial statements for the previous year;

- Approval of the amount of the annual membership fees;

- Election and dismissal of the President;

- Election and dismissal of 6 Vice-Presidents;

- Checking of funds management by the Association;

- Dissolution of the Association and the method of property settlement;

- All matters where the General Meeting reserves the decision-making competence;

- All issues related to the activity of the Association that are not covered by these Articles or otherwise;

The General Meeting takes note of the auditor’s report on the Association’s financial situation.

6. The General Meeting shall adopt its rules of procedure to define the form of deliberations, voting or other necessary actions.

7. Minutes shall be taken of every General Meeting and deposited at the registered office of the Association for consultation. The minutes shall be signed by the chairman of the General Meeting and the minutes clerk.

8. The General Meeting shall have a quorum if at least one-half of all members of the Association are present. In the event that the General Meeting does not have a quorum, the Executive Director of the Association shall convene a substitute General Meeting that should take place no sooner than 30 minutes after the assumed start of the originally convened General Meeting and within 6 weeks, at the latest, after the date, for which the original General Meeting was convened. If the substitute General Meeting does not take place on the same day, for which the original General Meeting was convened, the substitute General Meeting must be convened in the manner as described in paragraph 3 of this Article, with the invitation delivery deadline being reduced to 7 days. The substitute General Meeting shall have a quorum regardless of the number of the members present.

9. The General Meeting shall decide on all matters with absolute majority of all present members, except on the expulsion of a member, establishment and dissolution of the Association, election and dismissal of the President and 6 Vice-Presidents, and amendments to the Articles where a 2/3 majority of the present members is required.

For election and dismissal of the President and 6 Vice-Presidents, if the 2/3 majority of the present members is not reached even after the third election round or dismissal vote, an absolute majority of the present members shall be sufficient.

B. President of the Association

1. The President is an elected representative body of the Association and reports to the General Meeting. He/she is a member of the Presidium and guides its activities.

2. In case of absence or inactivity of the President, he/she shall be represented by the authorized Vice-President of the Association, or by the Executive Director, or by another duly authorized representative of the Association.

3. The President of the Association shall:

- Act on behalf of the Association in accordance with the Articles and the decisions of the General Meeting;

- Submit, to the General Meeting, the annual report on the Association’s activities and the implementation of the conclusions of the General Meeting;

- Coordinate national relationships (relationships vis-à-vis public administration bodies or the statutory representatives of other organisations, as the case may be) in cooperation with the authorized Vice-President, who is obliged to inform the President and the Presidium about all negotiations and the outcome of such negotiations;

- Draft and submit the Internal Rules of the Association for approval by the Presidium;

- Submit to the General Meeting a draft activity plan for the Association for the respective year, defining the objectives and tasks to achieve the plan;

- Appoint a Vice-President as the Association’s representative in interest federations;

- Manage and coordinate the work of the Executive Director.

4. The term of office of the President shall be 2 years.

C. Presidium of the Association

1. The Presidium shall be a collective body of the Association, consisting of the President and 6 Vice-Presidents who are elected by the General Meeting for the specific areas referred to below in paragraph 3 of this Article. Each member of the Presidium shall have one vote. In case of equality of votes, the President shall have a casting vote. The term of office of the Vice-Presidents shall be 2 years.

2. The activities of the Presidium shall be managed and coordinated by the President or, during his/her absence, by the Vice-President or the Executive Director duly authorized in writing by the President. The rank of the Vice-Presidents for deputizing and dividing competence in the particular areas referred to below in paragraph 3 of this Article shall be defined by the Internal Rules of the Association.

3. In the periods between the General Meetings, the Presidium shall meet at least once every two months to discuss and decide on essential issues related to the activities and strategy of the Association, in particular in the following areas:

a/ Strategic planning;

b/ Research, development, testing, standardization, information technology;

c/ Industry;

d/ Cooperation and commercial policy;

e/ Legislation;

f/ International Relations.

4. The individual Vice-Presidents shall be in charge of the management of the particular areas referred to in paragraph 3 above. The scope of their competence and responsibilities shall be defined by the Internal Rules, acting on behalf of the Association in accordance with the Articles and decisions of the General Meeting. For the period of office, the President and the Vice-Presidents may appoint their deputy or, as the case may be, an advisor to carry out the respective tasks; their appointment shall be approved by the Presidium. Their competence shall be defined by the Internal Rules. Each of the Vice-Presidents shall be responsible for elaborating and fulfilling the tasks in the area in his/her charge, as well as for relations and communication with the competent public administration authorities and private entities in that area.

5. The Presidium shall:

- Appoint and dismiss the Executive Director of the Association, based on a proposal by the President;

- Approve the Internal Rules of the Association, based on a proposal by the President;

- Coordinate the work of the Vice-Presidents, in liaison with the President;

- Propose measures in the particular areas referred to in paragraph 3 hereof for approval by the President;

- Decide on the termination of membership in the Association in cases defined in paragraph 5 of the Article on “Admission and Termination of Membership”;

- Approve the composition of the Council of Directors;

- Approve measures to provide financial and technical means for the execution of the tasks assigned to the bodies of the Association and for due and proper performance of the Association’s sphere of activity.

D. Executive Director of the Association

1. The Executive Director of the Association shall constitute a paid executive and operating body of the Association and shall be appointed and dismissed by the Presidium, based on a proposal by the President. He/she shall be in charge of the internal operation of the Association. To this end, the Executive Director shall set up a secretariat of the Association and appoint his/her deputies. The activities of the secretariat, the Executive Director and his/her competence shall be defined in detail by the Internal Rules.

2. The Executive Director shall report to the President of the Association and be in charge of the internal operation of the Association.

3. The Executive Director of the Association shall:

- Submit the financial statements for the previous year and the draft budget for the next year to the General Meeting for approval;

- Administer the property of the Association;

- Keep the agenda and the correspondence of the President and the Presidium of the Association;

- Coordinate the activities of all Vice-Presidents;

- Take all actions as necessary to ensure proper operation of the Association.

4. The Executive Director and his/her deputies shall regularly attend the meetings of the Presidium of the Association, with an advisory vote. He/she takes minutes of the Presidium meetings.

E. Council of Directors

1. The Council of Directors shall be an advisory body for the Presidium of the Association. The Council shall consist of the Chairman, the Vice-Chairman and the members. The term of office for the members, the Vice-Chairman and the Chairman of the Council shall be two years. The Council shall meet at the initiative of its Chairman or its members.

2. The Chairman shall be elected at a meeting of the Council members convened by the Presidium of the Association. He/she shall be entitled to submit to the Presidium of the Association, on behalf of the Council, proposals concerning all areas of activity of the Association in terms of the Articles. The proposals shall not have a legally binding effect for the Association and shall serve as recommendations for the Presidium of the Association. The Presidium shall authorize the Chairman and the members to act in favour of implementation of the approved recommendations.

3. The Council shall consist of the directors of the individual entities or, as the case may be, statutory representatives of members of the Association. A proposal for the appointment of a member of the Council shall be submitted by members of the Association on the prescribed form to the Presidium, which shall approve the composition of the Council. The Presidium shall inform the General Meeting about the composition and activities of the Council. The members of the Council shall have the right to use the identification of “Chairman (Vice-Chairman) of the Council of Directors” or “Member of the Council of Directors” of the Association, as appropriate.

4. Organizational matters and working methods of the Council shall be defined by the Internal Rules.

VIII. Dissolution of the Association

1. The Association shall be dissolved by the relevant decision of the General Meeting, with or without legal succession.

2. Where the rights and duties of the Association are not transferred to a legal successor, the dissolution is followed by liquidation. The liquidation shall be governed by the relevant provisions of the Commercial Code (Act No. 513/91 Coll., as amended); the liquidation balance shall be divided equally among the Association members.

3. The Association shall be dissolved upon deletion from the register by the competent authority.

IX. Others

These Articles were approved by the General Meeting on June 1, 2011.

In Prague on June 1, 2011

RNDr. Jiří Hynek

PRESIDENT OF THE DEFENCE AND SECURITY INDUSTRY ASSOCIATION OF THE CZECH REPUBLIC

DSIA