Debt recovery in the Czech Republic

An unpaid invoice from a Czech customer is not a different kind of claim from a domestic one; it simply follows different rules. Czechia has fast electronic court proceedings for undisputed claims, effective enforcement officers and public registers a Slovak creditor might wish to have at home. The obstacle is often simply that the creditor does not know the rules and has nobody to act for them. We address both obstacles.

How recovery works in Czechia

Searches first, costs afterwards. We check the Czech debtor before any expenditure arises. The Czech insolvency register is public, so we can identify an insolvent debtor immediately, including the progress of proceedings. The commercial register and collection of documents show statutory officers, company changes and financial statements. If the registers show that the debtor cannot pay, we tell you openly, saving you the cost of proceedings that would yield nothing.

Letter before action: legal significance in Czechia. Czech law treats a demand as more than a courtesy. Under § 142a of the Code of Civil Procedure, a successful claimant is generally entitled to recover costs only if they demanded performance from the debtor at least 7 days before bringing the claim. A demand from a Czech Bar lawyer also shows the debtor that the next step is a Czech court, and some claims are paid at precisely this stage.

Payment order or claim. For undisputed monetary claims, we apply for an electronic payment order: the court decides without a hearing and the fee is lower. For a disputed matter, we prepare a claim with an evidence plan. We describe court proceedings in detail on the letter before action and payment order in Czechia page.

Enforcement through a Czech enforcement officer. A final decision is an enforceable title. We file the enforcement application with an enforcement officer who, once authorised, searches for the debtor’s assets, including accounts, earnings and property. We monitor recovery through to payment.

What to watch for with a Czech debtor

Time is the most expensive mistake Slovak creditors make. The general Czech limitation period is three years (§ 629 of the Civil Code), while commercial obligations in Slovakia have a four-year period. A Czech debtor may therefore raise limitation sooner than a Slovak creditor expects. A creditor’s own demand may satisfy § 142a if it contains the required information and was sent to the correct address at least 7 days before the claim was filed. A lawyer’s demand is not a statutory requirement; we review your previous correspondence.

When the company has no assets: we also examine director liability

Unsuccessful enforcement need not be the last step. It may be one basis for checking whether the Czech company became insolvent earlier and whether its director at the time should have filed an insolvency petition without undue delay (§ 98 of the Insolvency Act). If a particular person breached that duty and caused damage or other loss to a creditor, a separate claim under § 99 may be available.

This is not automatic liability for the company’s debt. We prepare a timeline of insolvency, individual directors’ terms of office, share transfers, orders and payments. We also assess whether the claim was lodged in insolvency proceedings, what payment the creditor received and whether the claim is time-barred. Every former and current director is assessed separately; merely taking office does not create joint liability with a predecessor.

Removal of the company from the register or a share transfer therefore does not in itself close the matter. Equally, missing financial statements, a new foreign owner or unsuccessful enforcement are only indicators. Success depends on accounting records, contemporaneous information, procedural history, causation and individually calculated deadlines.

One firm instead of two

A common scenario is that a Slovak lawyer assesses the matter, then seeks a cooperating firm in Czechia; the file is transferred, information is lost and the creditor pays twice. That chain does not arise with us. A lawyer registered with both the Czech and Slovak Bar Associations handles Czech proceedings directly: we draft submissions in Czech, communicate with you in Slovak and agree the price in advance. If you have debtors in both countries, see cross-border debt recovery CZ ↔ SK; if you are unsure whether recovery is worthwhile, start with our debt recovery overview.