How to Enforce Payment Claims in the Czech Republic as a Maltese Business: A Legal Overview

Mgr. Vojtěch Sucharda
Mgr. Vojtěch Sucharda
9.3.2026 | ARROWS law firm

Maltese businesses pursuing debt collection against Czech debtors operate within a sophisticated legal framework that combines national procedures with European Union mechanisms. This comprehensive analysis demonstrates that while the Czech system provides powerful tools for creditors, the practical success of any recovery effort depends critically on meticulous documentation, proper procedural adherence, and an understanding of how Czech law differs from Maltese legal traditions.

Photograph captures a lawyer explaining cross-border debt collection.

The Czech Republic's approach to debt collection is governed primarily by Act No. 99/1963 Coll., the Code of Civil Procedure (OSŘ), and Act No. 120/2001 Coll., the Enforcement Code (Exekuční řád). These establish a comprehensive system of both court-based remedies and private enforcement mechanisms.

For Maltese businesses engaged with Czech debtors, understanding this legal landscape requires appreciation of how the Czech system differs fundamentally from the common law traditions. The Czech system operates within a civil law framework where the court's procedure is strictly governed by statutory codes, and judges play a significantly more active role in case management.

The Czech debt collection process is structured in layers, beginning with optional pre-litigation communication and progressing through simplified judicial procedures for undisputed claims. This tiered approach means that a Maltese creditor's strategy must be calibrated to the specific circumstances of each case to achieve resolution efficiently.

The system's effectiveness depends critically on careful documentation and procedural compliance from the outset. Errors in the initial stages can create compounding difficulties and delays in later phases, which is why ARROWS (office@arws.cz) recommends early strategic planning.

Preliminary steps and the critical pre-litigation phase

Before initiating formal court proceedings, the Czech legal system contemplates preliminary measures designed to encourage voluntary payment and establish the creditor's legal position. These preliminary steps are not mandatory for the validity of the claim itself, but they carry significant consequences for cost allocation in subsequent proceedings.

When a debtor fails to pay an invoice on the due date, the standard practice is to send one or more dunning letters requesting payment. However, the Czech legal system requires that if a creditor intends to recover legal costs, they must send a special formal letter requesting payment (předžalobní výzva) before filing any legal action.

This letter must be sent to the debtor's last known address no fewer than seven days before filing the legal action. The consequence of failing to comply with this pre-litigation requirement is significant, as the court generally will not award reimbursement of legal costs to the successful creditor.

In practice, this requirement means that Maltese businesses should maintain meticulous records of all communication with Czech debtors. Ensuring the letter specifically calls for payment of the debt and warning of potential litigation is essential to meet the statutory requirements.

Understanding Czech default interest and late payment obligations

One critical aspect that Maltese businesses often overlook when dealing with Czech debtors concerns statutory interest on late payment. The Czech Republic has implemented the EU Directive on combating late payments in commercial transactions, meaning the creditor becomes entitled to default interest when a debtor exceeds the payment period.

Unless the contract specifies a different rate, the statutory default interest rate is determined by Government Regulation. This rate is set at the Czech National Bank's repo rate plus eight percentage points, which is significantly higher than in some other jurisdictions.

Unlike some jurisdictions where default interest is discretionary, the Czech system makes this interest mandatory upon default, provided the creditor claims it. However, the calculation requires current knowledge of the CNB's repo rates and articulate inclusion of the interest claim in any legal proceeding.

1. What constitutes proper service of a pre-litigation demand letter?
The letter must be sent to the debtor's delivery address or data box at least seven days before filing the lawsuit. While strict "service into own hands" is not always required for the letter itself, retaining proof of posting (registered mail receipt) or delivery confirmation is crucial for claiming legal costs later.

2. Can a Maltese business claim default interest on Czech invoices?
Yes. If no specific rate was agreed upon in the contract, the statutory rate (CNB repo rate + 8% p.a.) applies automatically once the debtor is in default. The interest must be calculated accurately and explicitly included in the lawsuit.

3. Are there situations where the pre-litigation demand letter might be waived?
The requirement applies if you want to recover costs. Courts may exceptionally award costs without it strictly on grounds of special consideration, but relying on this exception is legally risky. Strict compliance is recommended.

The accelerated payment order procedure: fast-track recovery for undisputed claims

For a Maltese business pursuing a Czech debtor where the underlying claim is undisputed, the most efficient path to obtaining an enforceable judgment is the "Order for Payment Procedure" (platební rozkaz). This expedited process represents one of the most effective tools available to creditors in the Czech legal system.

The creditor files a formal lawsuit with the competent district court, explicitly requesting the issuance of a payment order. The court, if satisfied by the documents, issues a binding payment order without conducting a hearing or requiring the debtor's participation.

The sequence of events in a payment order procedure unfolds with considerable speed. Upon receipt of the application and supporting documentation, the court typically issues its decision within a period of weeks, operating in a "document verification" mode.

The Czech court does not issue a payment order merely because a creditor has followed procedural formalities. The judge must be convinced from the documentation that the underlying claim appears justified before issuing the order.

Once issued, the payment order is served on the debtor with notification of a fifteen-day period within which they may either pay the full amount or file a formal objection (odpor). This fifteen-day window is critical for the finality of the process.

If the debtor makes no response, the payment order becomes final and enforceable (pravomocný a vykonatelný), having the same effect as a final court judgment. However, if the debtor files an objection within the fifteen-day period, the payment order is automatically cancelled, and the matter is transformed into ordinary civil court proceedings.

Documentary requirements and evidentiary standards

The evidence required to support a payment order application is specific, requiring the creditor to provide clear documentary evidence substantiating the claim. This includes the contract, invoices, proof of delivery, and relevant correspondence.

For Maltese businesses, invoices should contain all material terms including identification of the goods or services, amounts, due dates, and clear identification of parties.

In practice, if the court finds the evidence insufficient or if the payment order cannot be served on the debtor into their own hands, the court will simply not issue the payment order. Therefore, accurate addresses and robust evidence are paramount.

1. What happens if the debtor files an objection to the payment order?
The payment order is cancelled, and the case proceeds as a standard lawsuit with hearings. The objection does not need to be substantiated with evidence at the filing stage; a simple statement that the debtor objects is sufficient to cancel the order.

2. How long can a Maltese creditor wait before submitting a payment order application?
The general statute of limitations is three years.

3. Can a payment order be used if the debtor's domicile is unclear?
No. A standard payment order cannot be issued if it would have to be served on the defendant abroad or if the defendant's address is unknown.

The electronic payment order: a modern variant

The Czech legal system provides a specific streamlined option called the Electronic Payment Order (elektronický platební rozkaz or EPR). This is available for claims where the principal amount does not exceed 1,000,000 CZK and offers a lower court fee compared to the standard procedure.

The proposal must be submitted on a specific electronic form signed with a recognized electronic signature or sent via the data box system.

However, the EPR has limitations, as it cannot be issued if the payment order would have to be served on a foreign addressee. Thus, it is useful for Maltese businesses only if the debtor has a valid service address within the Czech Republic.

The European payment order: cross-border access to Czech recovery

For Maltese businesses, the European Payment Order (EPO), established by EU Regulation 1896/2006, is a vital tool for cross-border cases. The advantage is a standardized form which simplifies the application process significantly.

If the Maltese business chooses to sue in the Czech Republic based on the debtor's domicile, the application is submitted to the competent Czech court. Note that if filed in the Czech Republic, the application generally must be in Czech or accompanied by a translation, as Czech courts conduct proceedings in the Czech language.

If the court issues the EPO, the debtor has 30 days to lodge a statement of opposition. If no opposition is filed, the EPO becomes enforceable directly without intermediate proceedings under the Brussels I bis Regulation.

Ordinary court proceedings: when claims are disputed

If a payment order is successfully opposed or not applicable, the case proceeds as ordinary litigation. This involves filing a lawsuit (žaloba) with the District Court (okresní soud) or, for certain specific matters, the Regional Court.

Key procedural aspects for 2026 include the requirement that all proceedings are in Czech, meaning documents in English or Maltese must be officially translated. While representation is not strictly mandatory for the first instance, it is practically impossible for a foreign entity to navigate the proceedings without a Czech attorney (advokát).

The plaintiff must prove their claim, as Czech civil procedure is largely adversarial (projednací zásada), meaning the court decides based on evidence proposed by the parties. If a party fails to provide sufficient evidence to support their assertions, they will lose the dispute.

The enforcement process: converting judgment to cash recovery

Once a Maltese creditor holds an enforceable title, such as a judgment or payment order, they must initiate enforcement (exekuce). In the Czech Republic, this is overwhelmingly conducted by judicial bailiffs (soudní exekutoři), who are private individuals vested with public authority.

The process begins when the creditor selects a bailiff and files a motion for enforcement. Upon authorization by the enforcement court, the bailiff immediately searches for and freezes assets including bank accounts, real estate, wages, and business shares.

The bailiff sends a "Call to fulfill the obligation" to the debtor, offering a chance to pay with reduced enforcement costs within 30 days. If the debtor fails to pay within this period, the bailiff proceeds to forced execution and liquidates the assets.

Asset seizure and liquidation powers

The bailiff has broad powers to access state registers such as the Cadastre, Vehicle Register, and Central Bank Account Register. The most common method involves blocking funds in bank accounts up to the debt amount.

The bailiff can also order the debtor's own customers to pay the creditor directly or seize and sell movable and immovable property at auction.

Certain assets are exempt, including a calculated "unseizable amount" from wages and essential household items. For corporate debtors, however, these personal exemptions rarely apply, making B2B enforcement more straightforward provided the company has assets.

Timeline and costs

The timeline for recovery varies, with a payment order typically taking 2–6 months if unopposed, while ordinary litigation can take 1–3 years for the first instance. Enforcement timing varies wildly from months to years depending on asset liquidity.

Court fees are generally 5% of the claimed amount, or 4% for an electronic payment order. It is important to note that cost reimbursement awarded by the court is calculated based on a statutory tariff, which often means the winner recovers less than they actually paid their lawyer.

Bailiff costs are primarily borne by the debtor. However, if enforcement is fruitless because the debtor has no assets, the creditor may be asked to cover the bailiff's minimum cash expenses.

Cross-border considerations

Under Regulation (EU) No 1215/2012 (Brussels I bis), a judgment given in Malta is enforceable in the Czech Republic without any declaration of enforceability. The creditor simply presents the Maltese judgment and the certificate issued by the Maltese court directly to the Czech bailiff.

Jurisdiction clauses

Parties may agree on jurisdiction under Art. 25 of Brussels I bis. If the contract states Czech courts have jurisdiction, the Maltese business must sue in the Czech Republic.

Conversely, if the contract states Malta, they sue in Malta and enforce the judgment in the Czech Republic. This choice of forum can significantly impact the strategy and cost of recovery.

The statute of limitations

The standard limitation period under the Civil Code is three years, starting from the day the right could be exercised for the first time, which is usually the due date. For claims where the creditor must invoke the right, the period starts when the act could have first been done.

If the debtor acknowledges the debt in writing, stating the reason and amount, a new ten-year limitation period may start. It is crucial to understand that sending a reminder does not stop the clock; only filing the lawsuit in court stops the limitation period from running.

Executive summary for management

Asset position assessment is mandatory before suing to ensure the Czech company is not in insolvency or liquidation. Suing a bankrupt company outside insolvency proceedings is futile and wastes resources.

Simplified procedures save cash, so utilizing the European Payment Order or Electronic Payment Order for undisputed invoices is highly recommended. Documentation is key, so ensure delivery notes are signed and pre-litigation calls are sent at least 7 days before filing to secure cost recovery.

The statute of limitations is three years, so prompt action is necessary to avoid losing the claim. ARROWS (office@arws.cz) can assist in evaluating the status of the claim and the debtor.

1. Does a Maltese court judgment require recognition in the Czech Republic?
No. Under Brussels I bis, it is automatically recognized and directly enforceable. You proceed directly to the Czech bailiff with the certificate (Art. 53) and translation.

2. What is the most cost-effective approach for a 50,000-euro claim?
If undisputed, the European Payment Order. If the debtor is in CZ, the Electronic Payment Order (if the limit allows – 50k EUR exceeds 1M CZK slightly, so standard Payment Order would apply).

3. What constitutes a valid pre-litigation call?
A letter identifying the debt, demanding payment, and warning of legal action, sent to the debtor's last known address at least 7 days before filing the lawsuit.

4. What happens if I miss the 3-year limitation period?
The obligation continues as a "natural obligation," but if you sue, the debtor will raise the plea of limitation, and the court will dismiss the claim. You will lose and pay the debtor's legal costs.

5. Can I enforce against assets in other EU countries?
A Czech judgment is enforceable across the EU. However, you must use the local enforcement agents of that specific country.

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 in the content, legal regulations and their interpretation evolve over time. To verify the current wording of the regulations and their application to your specific situation, it is therefore necessary to contact ARROWS Law Firm directly (office@arws.cz). We accept no responsibility for any damage or complications arising from the independent use of the information in this article without our prior individual legal consultation and expert assessment. Each case requires a tailor-made solution, so please do not hesitate to contact us.

Read also