How to Collect Debts in the Czech Republic:

Is your German business struggling with an unpaid invoice from a Czech partner? Navigating a foreign legal system can be complex. This guide offers practical answers and a clear strategy for recovering your funds. As a leading Czech law firm in Prague, ARROWS helps international clients manage cross-border debt collection. Our English-speaking lawyers provide the local expertise needed to secure your payments efficiently.

Do you need advice on this topic? Contact the ARROWS law firm by email office@arws.cz or phone +420 245 007 740. Your question will be answered by "Mgr. Vojtěch Sucharda", an expert on the subject.

The First Critical Step: Amicable Debt Collection in the Czech Republic

Before initiating formal legal action, a professional, out-of-court approach is the most strategic and cost-effective first step in the Czech Republic. This amicable phase is not a sign of weakness; it is a calculated business decision. 

It preserves potentially valuable commercial relationships, avoids costly court fees, and is often the fastest path to payment. In fact, experienced legal specialists find that up to 95% of commercial debt cases in the Czech Republic can be resolved successfully without ever entering a courtroom.

ARROWS’ lawyers are skilled negotiators, capable of drafting professional communications that secure payments while maintaining commercial goodwill. We understand the nuances of Czech business culture and can often achieve a positive outcome through structured dialogue and clear, firm correspondence.

The Mandatory Pre-Action Letter: A Critical Czech Requirement

One of the most significant differences between German and Czech pre-litigation practices involves the formal warning letter. Under Czech Procedural Law, a creditor is legally required to send a specific pre-action letter to the debtor's last known address at least seven days before filing a claim in court. This is not merely a courtesy reminder; it is a mandatory procedural step with serious financial consequences.

A German company might assume that sending its standard Mahnung (demand letter) fulfills this requirement. This is a costly mistake. The Czech pre-action letter must explicitly warn the debtor of the intention to file a lawsuit. If this specific, legally compliant notice is not sent and properly documented, a Czech court will likely refuse to award the creditor their legal costs, even if they win the case on its merits. 

This procedural misstep could force you to pay your own legal fees, potentially negating the financial benefit of a successful claim. This single rule highlights that effective cross-border debt collection requires deep local knowledge, not just translation.

ARROWS ensures this critical piece of documentation is drafted, served, and recorded correctly, protecting your right to a full recovery of all associated costs. For immediate assistance with drafting a compliant pre-action letter, write to us at office@arws.cz.

Risks in the Amicable Phase

Navigating the pre-litigation stage without expert local guidance exposes your business to significant and unnecessary risks.

Legal risk and potential issues	How ARROWS helps
Sending a non-compliant warning letter: Forfeiting the right to recover legal costs, even if you win the case.	Drafting legally required documentation: We ensure your pre-action letter meets all Czech legal standards. Need help? Contact us at office@arws.cz.
Ignoring the Statute of Limitations: The general limitation period for commercial debts is 3 years in the Czech Republic. Delay can make your claim legally unenforceable.	Legal consultations: We assess your claim's validity and timeline to prevent it from becoming time-barred. For an urgent review, email office@arws.cz.
Poorly Negotiated Payment Plans: Agreeing to a verbal or informal plan that is not legally enforceable if the debtor defaults again.	Contract drafting: We draft binding settlement agreements and installment plans with enforcement clauses. Get tailored legal solutions by writing to office@arws.cz.
Inadequate Documentation: Failing to gather all necessary evidence (contracts, invoices, delivery notes) weakens your position for potential litigation.	Legal analysis: We review your documentation to build a strong case from the start. Want to understand your legal options? Email us at office@arws.cz.

When Negotiations Fail: Navigating the Czech Judicial System

If amicable efforts do not result in payment, the next step is to leverage the Czech judicial system. The process is designed to be efficient for clear-cut claims, but it requires precise execution.

The Czech "Order for Payment" (platební rozkaz)

For undisputed monetary claims, the most effective tool is the "Order for Payment Procedure" (návrh na platební rozkaz). This is a fast-track judicial process that allows a court to issue a binding payment order without holding a formal hearing. The court makes its decision based solely on the facts and documentary evidence submitted by the creditor.

The process begins by filing a formal application with the competent district court. The court reviews the application and the supporting evidence, such as contracts and invoices. If the claim is well-founded, the court issues a platební rozkaz (payment order). This order is then served on the debtor, who has 15 days from the date of delivery to either pay the full amount or file a formal objection.

What Happens if the Debtor Files an Objection (odpor)?

The debtor has the right to contest the claim by filing an odpor (objection or opposition) within the 15-day deadline. The filing of an odpor has an immediate and significant legal effect: the platební rozkaz is automatically cancelled in its entirety.

This action transforms the case from a simplified, document-based procedure into a standard civil lawsuit (žaloba na plnění). The matter will then proceed to a full court hearing, where both parties will present arguments, submit further evidence, and potentially call witnesses. This transition marks a critical point where the costs, complexity, and timeline of the case increase substantially. It is at this stage that experienced litigation counsel becomes indispensable.

ARROWS’ litigation team is prepared for this eventuality. We manage the seamless transition from the fast-track procedure to full court proceedings, robustly defending your interests and building a compelling case for trial. Our lawyers are ready to assist you – email us at office@arws.cz.

FAQ – Legal tips about the platební rozkaz procedure

• Is there a monetary limit for a platební rozkaz?

A standard platební rozkaz has no upper monetary limit. A related, fully electronic version of this procedure, which offers a lower court fee, was previously capped at CZK 1 million. However, a recent legislative amendment removed this limit, making the electronic payment order a powerful and cost-effective tool for large claims as well. For advice on the best procedure for your claim, contact us at office@arws.cz.

• What evidence do I need to file for a platební rozkaz?

You must provide strong, clear documentary evidence that substantiates your claim. This includes signed contracts, issued invoices, confirmed delivery notes, and any correspondence acknowledging the debt. Our lawyers can review your documents to ensure your application is built on a solid foundation. For immediate assistance, write to us at office@arws.cz.

• How long does it take to get a platební rozkaz?

The procedure is designed for speed. If the application is correctly filed with sufficient evidence, a court can issue the order within a few weeks to a few months, much faster than ordinary litigation. Need legal help to expedite the process? Contact us at office@arws.cz.

A Familiar Path? Comparing Czech and German Debt Collection Procedures

For a German business, the Czech platební rozkaz may seem similar to Germany's own Mahnverfahren. While both are designed to streamline the collection of undisputed debts, crucial differences in their underlying legal philosophy and procedure can trap the unwary. Understanding these distinctions is key to a successful recovery strategy.

Platební rozkaz vs. Mahnverfahren – Key Differences

The German Mahnverfahren is a two-step process that begins with a Mahnbescheid (court order for payment) and, if uncontested, concludes with a Vollstreckungsbescheid (enforcement order). The initial application for a Mahnbescheid is a highly automated, administrative process. The court's role at this stage is primarily to check for formal correctness; it does not conduct a substantive review of the claim's legal merit.

This creates a significant "judicial scrutiny gap" when compared to the Czech system. To issue a platební rozkaz, a Czech judge must be personally convinced from the outset that the creditor's claim is justified based on the evidence provided. A claim that might easily pass the administrative filter for a Mahnbescheid in Germany could be rejected at the initial stage in the Czech Republic if the evidence is not presented clearly and compellingly. 

This fundamental difference requires a more robust and well-prepared initial filing in the Czech Republic. A German creditor cannot simply translate their standard approach; they must adapt to the higher evidentiary burden of the Czech system from day one.

The Strategic Advantage of Local Expertise

Successfully navigating these subtle but critical procedural differences requires a legal partner with deep expertise in both jurisdictions. ARROWS is uniquely positioned as an international law firm operating from Prague, European Union. Our lawyers have extensive experience advising German clients, allowing us to anticipate challenges and adapt strategies that align with the expectations of the Czech courts.

Through our ARROWS International network, built over more than 10 years, we seamlessly handle complex cross-border matters. Our firm proudly supports over 150 joint-stock companies and 250 limited liability companies, many with significant international operations, demonstrating our capacity to manage the needs of sophisticated corporate clients.

Your Cross-Border Advantage: Using EU-Wide Legal Tools

In addition to domestic procedures, European Union law provides powerful instruments for resolving cross-border commercial disputes. For German creditors, these tools can offer a highly effective alternative to purely national litigation.

The European Payment Order (EOP) – A Powerful Alternative

For undisputed monetary claims between parties in different EU member states (except Denmark), the European Payment Order (EOP) offers a standardized and simplified procedure. A German creditor can file a single EOP application against a Czech debtor. If the debtor does not contest the claim, the resulting order is automatically recognized and enforceable in the Czech Republic without needing a separate declaration of enforceability (exequatur).

The process is straightforward: the creditor files a standard Form A with the competent court. The court has 30 days to issue the EOP, and the debtor then has 30 days to pay or file a statement of opposition. The EOP is particularly attractive for its speed, relatively low cost, and simplicity.

However, this simplicity can be a trap. If the Czech debtor files even a simple, unsubstantiated statement of opposition, the EOP procedure is immediately terminated. The case is then automatically transferred to ordinary civil proceedings before the competent Czech court, governed by Czech procedural law. A German company that filed the EOP on its own is now suddenly a plaintiff in a foreign lawsuit, facing local deadlines, language barriers, and procedural rules without a lawyer on the ground. This hidden risk underscores the importance of having local counsel from the start.

ARROWS can manage the entire EOP application process, ensuring it is filed correctly with the competent Czech court and in an accepted language. More importantly, we stand ready to act as your local litigation team, seamlessly taking over the case if an objection is filed and ensuring your claim is not derailed. Get tailored legal solutions by writing to office@arws.cz.

Risks of Improperly Filed Cross-Border Claims

Using EU-level procedures without local expertise can lead to unforeseen complications and delays.

Legal risk and potential issues	How ARROWS helps
EOP Objection: The debtor files a simple objection, terminating the EOP and forcing you into a full Czech lawsuit you are unprepared for.	Representation in court: We are prepared to seamlessly transition your case from an EOP to ordinary litigation, protecting your interests. Need legal representation? Write to office@arws.cz.
Incorrect Jurisdiction: Filing the EOP or a domestic claim in the wrong court, leading to dismissal and wasted time and money.	Legal analysis: We determine the correct jurisdiction based on EU regulations and Czech law. Want to understand your legal options? Email us at office@arws.cz.
Enforcement Delays: Having a valid German judgment but not knowing the correct local procedure to enforce it in the Czech Republic.	Help with regulatory approvals: We manage the process of recognizing and enforcing foreign judgments, including the European Enforcement Order, with local bailiffs. Do not hesitate to contact our firm – office@arws.cz.

The Final Stage: Enforcing a Judgment in the Czech Republic

Securing a court judgment is a major victory, but it is not the final step. The judgment must then be enforced to convert the legal decision into actual payment.

Understanding the Czech Enforcement Process (exekuce)

Once you have an enforceable title—such as a final Czech court judgment, an uncontested platební rozkaz, or a certified EOP—the debt collection process moves into the enforcement stage, known as exekuce. This process is carried out by a court-appointed private bailiff, or exekutor, who is vested with significant legal authority to secure payment.

Unlike in some other jurisdictions, the exekutor, not the court, determines which of the debtor's assets will be targeted for collection. Their powers are extensive and can include freezing and seizing funds from bank accounts (obstavit účet), garnishing receivables from the debtor's customers, seizing and selling movable property (like vehicles and equipment), and placing liens on and forcing the sale of real estate.

Maximizing Recovery and Minimizing Costs

The costs associated with the exekuce process, including the exekutor's fee—which is typically a percentage of the amount recovered, often 15%—are added to the total debt and are ultimately paid by the debtor. While the creditor may be asked to pay an initial deposit to cover expenses, the goal is a full recovery of the principal debt, interest, and all legal and enforcement costs.

Efficient management of this final stage is crucial. ARROWS maintains a network of trusted and highly effective exekutors across the Czech Republic. We manage the entire enforcement process on your behalf, from filing the application with the chosen exekutor to overseeing the seizure and liquidation of assets, ensuring that every legal measure is taken to recover your funds as swiftly as possible. Our lawyers are ready to assist you – email us at office@arws.cz.

FAQ – Legal tips on the Enforcement (exekuce) Process

• Can a judgment from a German court be enforced directly in the Czech Republic?
  Yes. Under the EU's Recast Brussels Regulation, a judgment issued in any EU member state is directly enforceable in another without needing a special declaration of enforceability. ARROWS can manage the entire process of domesticating your German judgment for enforcement by a Czech exekutor. Need legal help? Contact us at office@arws.cz.
• What assets can an exekutor seize?
  An exekutor has broad powers to seize nearly any asset belonging to the debtor. This includes funds in bank accounts, real estate, vehicles, company shares, inventory, and other movable property. Get tailored legal solutions by writing to office@arws.cz.
• How long does the enforcement process take?
  The timeline can vary significantly, from months to, in complex cases, years. The duration depends on factors like the type and location of the debtor's assets and whether the debtor attempts to obstruct the process. Proactive management by an experienced law firm is key to accelerating recovery. For immediate assistance, write to us at office@arws.cz.
  

Why ARROWS is Your Partner for Success in Czech Debt Collection

Recovering a cross-border debt requires more than just legal knowledge; it requires a strategic partner who understands your business context, speaks your language, and is a master of the local legal environment. ARROWS combines deep expertise in Czech debt collection law with a nuanced understanding of the German legal framework, providing an unparalleled advantage for our clients.

Our comprehensive services cover every stage of the process, from drafting legally compliant pre-action letters and negotiating settlements to robustly representing you in court and aggressively managing enforcement proceedings. We provide a full suite of related legal support, including contract reviews to prevent future disputes and professional training for your management team.

With a track record of supporting over 150 joint-stock companies and 250 limited liability companies, and an operational reach across 90 countries through our international network, ARROWS has the experience and capacity to handle the most complex international claims.

Don't let an unpaid Czech invoice disrupt your business. As a leading Czech law firm based in Prague, EU, we specialize in securing payments for our international clients. Contact our expert team today at office@arws.cz for a confidential consultation.

FAQ – Most common legal questions about Debt Collection in the Czech Republic

• What is the statute of limitations for a commercial debt in the Czech Republic?
  The general limitation period is three years, starting from the invoice's due date. It is critical to initiate legal action before this period expires. If a debtor raises the objection that the claim is time-barred, a court will dismiss it. A written acknowledgment of the debt by the debtor can restart the limitation period, creating a new 10-year term. To verify if your claim is still enforceable, contact our lawyers at
  office@arws.cz.
• How much does it cost to collect a debt through the Czech courts?
  Costs consist of court fees and legal fees. Court fees are typically a percentage of the claimed amount—5% for a standard lawsuit or 4% for an electronic payment order for claims over CZK 20,000. Legal fees vary with the case's complexity. Crucially, if you win, these costs are generally recoverable from the debtor, provided all procedural rules, like the pre-action letter, were correctly followed. For a detailed cost assessment of your case, email us at office@arws.cz.

• What documents do I need to start a debt collection case?
  A strong case is built on comprehensive documentation. You will need the signed contract, all original invoices, proof of delivery (such as signed delivery notes or transport documents), and any relevant correspondence with the debtor where the debt is discussed or acknowledged (e.g., emails, letters). Our firm can help you compile and review your documentation to build the strongest possible case. Do not hesitate to contact our firm – office@arws.cz.

• How long does the entire debt collection process take in the Czech Republic?
  The timeline can vary dramatically. An amicable settlement might be reached in a few weeks. An uncontested platební rozkaz can result in an enforceable title within 2-6 months. However, if the case proceeds to a contested, ordinary court proceeding, obtaining a final judgment can take one to three years. Swift action and expert legal management are essential to minimizing this timeline. Get tailored legal solutions by writing to office@arws.cz.
• What are common defenses debtors use in the Czech Republic?
  Debtors may attempt to dispute a claim by alleging that no valid contract existed, that goods were never delivered or were defective, that services were not performed correctly, or that the claim is barred by the statute of limitations. The best way to overcome these defenses is with a meticulously prepared case supported by clear, undeniable evidence. Our lawyers are ready to anticipate and counter these arguments on your behalf – email us at office@arws.cz.
• Can ARROWS help enforce a judgment I already won in Germany?
  Absolutely. As a result of EU regulations, a judgment from a German court is directly enforceable in the Czech Republic. Our team at ARROWS, an international law firm operating from Prague, European Union, regularly manages the local enforcement of foreign judgments. We handle all necessary formalities and coordinate with Czech bailiffs to ensure your German judgment is executed efficiently to secure your funds. For immediate assistance with enforcement, write to us at office@arws.cz.