How Portuguese Businesses Can Recover Debts in the Czech Republic:

This report provides Portuguese businesses and investors with practical guidance on recovering outstanding debts from Czech debtors. The Czech debt collection system operates fundamentally differently from the Portuguese framework, from mandatory pre-action letters to enforcement mechanisms. Understanding these differences is essential, as procedural missteps can destroy your right to recover costs. This guide examines the entire process to help maximize recovery prospects.

Executive summary

Czech debt collection works differently than in Portugal — formal pre-litigation steps and proof of delivery matter as much as the debt itself.
The pre-action letter (“předžalobní výzva”) is mandatory if you want to recover legal costs, even when you win the case in full.
Time is your enemy: the standard limitation period for commercial claims is typically 3 years from due date.
The payment order (platební rozkaz) is usually the fastest court route for undisputed invoices — but it requires clean documentation and Czech-language filings.
Best practice: run a structured evidence pack, follow the Czech procedure precisely, and prepare for enforcement early if the debtor remains passive.

Understanding the Czech debt collection framework and key differences from Portugal

This report provides Portuguese businesses and investors with practical guidance on recovering outstanding debts from Czech debtors. Although both countries are EU Member States and share civil-law foundations, the Czech debt recovery system is built on strict procedural requirements that can materially affect your outcome — including whether you can recover costs even if you “win” the case.

In the Czech Republic, debt recovery is not a loose sequence of reminders and escalation. It is a structured process under the Civil Code and the Code of Civil Procedure, where formal steps (and evidence that they happened) can determine the financial result. A claim can be valid and still become economically painful if you fail to follow the mandatory pre-litigation rules.

The key point: in Czech proceedings, the “loser pays” principle for costs only works in your favour if you comply with the procedural requirements. That is a meaningful difference compared to what Portuguese creditors often expect. It also means a debtor may weaponize formalities to reduce your recovery — not by defeating the debt, but by destroying cost reimbursement.

Time matters as well. For many commercial claims, the standard limitation period in the Czech Republic is typically three years, often starting from the invoice due date. If you wait, you may discover you have lost enforceability, not because the debt is disputed, but because the clock ran out.

The critical pre-litigation phase: why Portuguese businesses often fail

The pre-litigation phase in Czech debt collection is not optional, not “nice to have”, and not a mere negotiation courtesy. It is a statutory step that directly impacts your ability to recover legal costs. Portuguese companies often underestimate the formality required, because the Czech system expects a specific structure and timing — and courts enforce it strictly.

Under Section 142a of the Czech Code of Civil Procedure, a creditor must send a proper pre-action letter (předžalobní výzva) at least 7 days before filing a lawsuit. If you skip this step, or do it incorrectly, the court may deny your cost reimbursement even if the debtor undeniably owes the money and you win on the merits.

The letter must clearly identify creditor and debtor, specify the amount owed, describe the legal basis of the claim, and explicitly warn that failure to pay will result in court proceedings and a request for cost reimbursement. Just sending a “polite demand” email, an English-only reminder, or an invoice follow-up is commonly not sufficient for Czech courts.

Delivery method matters because proof matters. Registered post is common, but the most reliable channel is the Czech data box system (datová schránka) when dealing with Czech entities. If you cannot prove delivery (or at least proper sending), you risk the court treating the pre-action letter as if it never existed.

The pre-action letter is also a strategic tool. A well-drafted notice often triggers settlement precisely because it communicates seriousness and creates legal pressure. In practice, many cases resolve during or shortly after this phase, before the claim becomes a long-running dispute. That is why it’s worth doing it properly — it both protects your cost position and increases your settlement leverage.

Common pre-litigation mistakes (and their consequences)

Missing mandatory warning language: the court may deny cost recovery even if you win in full.
Wrong timing (less than 7 days before filing): the letter does not satisfy statutory conditions.
Informal email with no proof of delivery: the court may treat the notice as never sent.
Incorrect interest calculation: debtor can challenge the amount; dispute becomes harder to streamline.
English-only letter to a Czech debtor: not necessarily invalid, but Czech is strongly recommended for clarity and proof.

The order for payment (platební rozkaz) – your primary tool

For undisputed monetary claims, the Czech payment order (platební rozkaz) is typically the most efficient litigation path. It is designed for situations where the debtor’s liability can be shown through documents, and the court can issue an order without a hearing in the initial stage. When used correctly, it can significantly speed up recovery.

The process starts with a formal application to the competent Czech court. The filing must contain a clear factual narrative and well-organized evidence. Judges review payment order applications on paper; if the documentation is persuasive, they issue the order. This is not a “rubber stamp” procedure — the quality of your evidence and its structure directly affects speed and success.

Once served, the debtor typically has 15 days to pay or file an objection (odpor). Importantly, the debtor does not need to justify the objection in detail at this stage. A simple objection cancels the payment order and shifts the dispute into standard civil litigation. That does not mean you are losing — it means the case becomes procedural and evidence-heavy, so preparation matters.

Evidence quality is non-negotiable. Typically, you will need the signed contract (or provable acceptance), invoices, proof of delivery/performance, and any acceptance documentation. All filings must be made in Czech. For Portuguese creditors, this makes local counsel practically necessary, not only for language but for procedural handling and court communication.

Court fees are generally calculated as a percentage of the claim. In many situations, electronic filings via counsel can reduce the fee compared to standard filings. The larger point is simple: if the process is executed cleanly, the Czech system provides effective tools; if it is executed loosely, it becomes expensive and slow.

Conclusion: strategic pathways forward for Portuguese creditors

Czech debt collection can be highly effective, but it rewards procedural discipline. The mandatory pre-action letter is a central gatekeeper: it does not only signal seriousness to the debtor, it also protects your ability to recover costs. Combined with a properly prepared payment order application, it usually offers the best balance of speed, pressure, and enforceability.

If your claim is approaching the three-year limitation threshold, urgent action is recommended. Time-barring is one of the most common ways creditors lose viable claims in practice — not because the debtor is right, but because the deadline wins.

ARROWS provides end-to-end support for Portuguese creditors, from pre-litigation strategy and compliant demand letters, through court filings, to enforcement once a judgment or enforceable title exists. With local expertise and international coordination, the process can be handled remotely without the need for you to travel to the Czech Republic.

FAQ – Most common legal questions about debt collection in the Czech Republic

1) My Czech invoice is now two and a half years old, and the debtor still has not paid. Is it too late to pursue the claim?

Not necessarily, but you should act immediately. Many commercial claims have a standard three-year limitation period from the invoice due date. You may have only a short window left to file and secure enforceability. A compliant pre-action letter and a properly structured court filing can help protect your position.

2) Can I pursue a Czech debt from Portugal, or must I personally travel to Prague to handle the litigation?

In most cases, you do not need to travel. Czech proceedings can be handled through local counsel under a power of attorney. You can provide documentation remotely, and your lawyers can manage filings, communication with the court, and procedural steps on your behalf.

3) What are the typical costs involved in pursuing a Czech debt collection case?

Court fees are typically calculated as a percentage of the claim, and legal fees depend on complexity and the dispute pathway. If you win and follow mandatory pre-litigation rules, the court generally orders the debtor to reimburse costs under statutory rules. The pre-action letter is therefore not just a formality — it directly impacts the economics of recovery.

4) If the debtor files a simple objection to my payment order, does that mean my case is lost?

No. An objection cancels the payment order and transfers the dispute into standard civil litigation. If your evidence is strong, you can still succeed — the process simply becomes more formal and may take longer. This is why evidence preparation and procedural compliance are critical from the first step.

5) Can a Czech court judgment be enforced against the debtor’s assets in other EU countries?

Often yes, depending on the enforcement title and the debtor’s asset location. Cross-border enforcement within the EU is generally possible, but practical execution depends on the type of decision, local requirements, and the debtor’s actual asset structure. A targeted enforcement plan is recommended before you invest time into a purely “symbolic” judgment.

Disclaimer

The information contained in this article is for general informational purposes only and serves as a basic guide to the issue. Although we strive for maximum accuracy, legal regulations and their interpretation evolve over time. To verify the current wording and its application to your specific situation, please contact ARROWS Law Firm directly. We accept no responsibility for any damage or complications arising from independent use of the information in this article without prior individual legal consultation and expert assessment. Each case requires a tailor-made solution.

How Portuguese Businesses Can Recover Debts in the Czech Republic: Practical Legal Tips