Italian Companies and Debt Collection in the Czech Republic:

Struggling with an unpaid invoice from a Czech business partner? This guide provides Italian companies with specific answers for navigating cross-border debt collection. As a leading Czech law firm in Prague, EU, our English-speaking lawyers (or avvocato a Praga) have the expertise in recupero crediti (debt recovery) to help you recover your funds. We are your safe European harbour for resolving these disputes.

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 costly mistake: Why your italian approach is a financial risk in Prague

When a Czech partner fails to pay, your first instinct as an Italian business owner is likely to send a strongly worded demand letter, perhaps a translation of a standard Italian messa in mora (formal notice of default).  

In the Czech Republic, this instinct is a significant and costly mistake. The Czech legal system has a procedural requirement that, if ignored, carries severe financial penalties. Before you can file a lawsuit, you are legally required to send the debtor a specific pre-action letter, known as a předžalobní výzva.

This is not merely a procedural formality. Under § 142a of the Czech Code of Civil Procedure, this letter is a mandatory prerequisite for the recovery of your legal costs. If you fail to send this specific letter, correctly formatted and delivered at least seven days before filing a claim, the court will not grant you reimbursement for your court fees and attorney costs, even after you win the case.

The Czech system is, in this way, "debtor-protective". It is designed to prevent a debtor from being caught unaware by a lawsuit and its associated costs. 

A standard Italian demand letter, which is not based on this Czech law, will not satisfy the court. You will win the principal debt but lose thousands of euros in legal expenses.

ARROWS lawyers provide essential "drafting of legally required documentation," ensuring your first step is compliant and secures your right to a full financial recovery. For immediate assistance, write to us at office@arws.cz.

How is Czech debt collection different from Italy?

For Italian companies, the Czech Republic can create a false sense of security. Both countries are EU members and civil law jurisdictions, a shared foundation that is ultimately "dangerous" because it hides fundamental differences in legal philosophy.

Italian contract law is deeply rooted in principles like buona fede (good faith) and the underlying relationship. Judges often look beyond the literal text. In the Czech Republic, the process is far more rigid. Your reliance on a "handshake" or a long-term relationship can become a significant legal vulnerability.

This cultural difference creates a critical "time bomb" for Italian creditors. In Italy, it is common to have long payment delays, with an average DSO (Days Sales Outstanding) of 75 days. Italian business culture is patient. But in the Czech Republic, this patience is a fatal financial error.

The general statute of limitations (promlčecí lhůta) for a commercial debt is only three years from the due date. This is far shorter than the standard ten-year prescription period in Italy. If you wait patiently, as you might in Italy, your Czech debt can become legally uncollectible.

Even our legal tools are different. While the Italian decreto ingiuntivo (payment injunction)  and the Czech platební rozkaz (payment order) seem similar, they are not identical.

The platební rozkaz is the default "fast track" for nearly all monetary claims in the Czech Republic, and understanding its specific rules is key to a fast recovery.

FAQ – Legal tips about Czech vs. Italian Procedures

1. Is my Italian contract's jurisdiction clause valid in the Czech Republic?

Yes. Under EU Regulation 1215/2012 (Brussels I Recast), jurisdiction clauses and judgments are generally recognized. However, it is often faster and cheaper to use the Czech platební rozkaz procedure than to enforce an Italian judgment. We can provide a legal opinion on the fastest strategy. Want to understand your legal options? Email us at office@arws.cz.

2. My Czech partner keeps promising to pay. Should I wait?

This is a common risk. While you are waiting, the 3-year statute of limitations (promlčecí lhůta) could expire, making your debt legally uncollectible. The debtor could also be preparing for insolvency (insolvenční řízení). Do not risk your claim. Get tailored legal solutions by writing to office@arws.cz.

3. What if we only had a verbal agreement?

Unlike in some systems, Czech law recognizes many verbal agreements as legally valid. The burden of proof is on you, using evidence like bank transfers, emails, text messages, or witness testimony. These cases are complex but winnable. Our lawyers are ready to assist you – email us at office@arws.cz.

What is your step-by-step strategy for pre-litigation?

Before initiating any court proceedings, a professional, out-of-court approach is the most strategic and cost-effective first step

This amicable phase is not a sign of weakness; it is a calculated business decision. Experienced legal specialists find that up to 95% of commercial debt cases in the Czech Republic can be resolved successfully at this stage.

This high success rate is not due to a polite request. It is the direct result of a formal, strategic legal maneuver. 

A Czech debtor who receives a non-compliant letter knows there is no immediate risk. A debtor who receives a compliant pre-action letter from a law firm like ARROWS knows they are 7 days away from a lawsuit and from being liable for all associated legal fees. This is what compels payment.

Our specialists are here for you

Our strategy involves three key phases:

Step 1: Legal Analysis and Documentation Review

Before we make contact, our lawyers perform a "Legal analysis". We review your contracts, issued invoices, and delivery notes. Most importantly, we confirm your claim is not "time-barred" by the 3-year statute of limitations.

Step 2: Drafting the Compliant Předžalobní Výzva

This is the critical step. We "draft legally required documentation", specifically the pre-action letter that satisfies § 142a. This official letter, sent from a leading Prague law firm, signals that your company is prepared to escalate the matter, shifting the power dynamic immediately.

Step 3: Strategic Negotiation and Binding Settlement

When the debtor responds, we do not accept verbal promises that can be broken. Our goal is to secure your money. We provide "contract drafting" services to prepare a binding settlement agreement or an installment plan with an enforcement clause. This turns a disputed debt into a new, fully admitted, and easily enforceable legal document.

Risks in the Amicable Phase

Risks and Penalties	How ARROWS Helps
Sending an incorrect demand letter (e.g., a translated messa in mora). Penalty: You lose 100% of your right to recover legal fees from the debtor, even if you win the case.	Drafting legally required documentation. We prepare a compliant předžalobní výzva that secures your right to costs. Need a valid legal warning? Contact us at office@arws.cz.
Missing the statute of limitations (promlčecí lhůta). Penalty: Your debt becomes legally unenforceable. The court will dismiss your claim if the debtor objects. The general period is 3 years.	Legal analysis. We immediately verify your claim's validity before you spend any money on collection.Is your debt still collectible? Email us at office@arws.cz.
Agreeing to a verbal or informal payment plan. Penalty: The debtor defaults again, and you have no enforceable document. You have wasted critical time.	Contract drafting. We draft binding settlement agreements (dohoda o narovnání) with acceleration clauses. Get tailored legal solutions by writing to office@arws.cz.
Debtor files for insolvency (insolvenční řízení). Penalty: Your claim is frozen, and you may recover only a tiny fraction of your debt, or nothing.	Representation before public authorities. We monitor debtors and can represent you in insolvency proceedings to register your claim. Our lawyers are ready to assist you – email us at office@arws.cz.

How do you take legal action in the Czech Republic?

If the debtor ignores the compliant pre-action letter, the next step is judicial action. The Czech system is highly efficient for uncontested claims, using a "fast track" procedure called the Payment Order (platební rozkaz).

This process is designed to be fast and cost-effective by avoiding an initial, expensive court hearing.

Here is the step-by-step judicial process:

1. Filing the Application: Our lawyers prepare and file the návrh na platební rozkaz (application for a payment order) with the competent district court. We attach all supporting evidence, such as the contract, invoices, and proof of delivery.

2. Judicial Review: The court reviews the application and evidence "based solely on the facts and documentary evidence". There is no hearing at this stage.

3. The Debtor's 15-Day Choice: If the claim is well-founded, the court issues the platební rozkaz and serves it to the debtor. The debtor then has 15 days from delivery to take one of three actions:

• Pay the full amount: The debt is recovered.
• Do nothing: The payment order becomes final and legally enforceable, just like a final court judgment.
• File an objection (odpor): This is the debtor's only way to contest the claim.

If the debtor files an odpor—which does not need to be justified—the payment order is automatically cancelled. The case then converts into a standard litigation proceeding. 

At this point, ARROWS provides full "representation in court", where we argue your case to win a full judgment. This system is essentially a filter. It heavily favors the creditor who has perfect documentation. A debtor who knows the evidence is strong is unlikely to file an odpor and drag the case to a costly trial they will lose. 

This is why our "contract drafting" and review services are so valuable—they ensure you win the collection case before it even starts.

What EU tools can you use as an Italian creditor?

As an Italian company operating within the EU, you have powerful cross-border tools at your disposal. 

As an international law firm operating from Prague, European Union, with an "ARROWS International" network built over 10 years and operating in 90 countries, we are experts in deploying these EU regulations.

The European payment order (EPO): Is it better?

The European Payment Order (EPO) (Regulation 1896/2006) is a unified EU-wide procedure for uncontested, cross-border claims.

It is filed using a standard "Form A" and is designed to be simple.

As an Italian creditor, you have a strategic choice. While the EPO is available, a domestic Czech platební rozkaz is often faster to file and, more importantly, faster to enforce within the Czech Republic. 

ARROWS provides "Legal opinions" to advise on the most effective and fastest tool for your specific case.

How to enforce your Italian judgment in Prague

What if you have already won in an Italian court and have a decreto ingiuntivo? 

Thanks to the Brussels I Regulation (Recast) (EU 1215/2012), your Italian judgment is directly recognized and enforceable in the Czech Republic "without needing a special declaration of enforceability".

However, you cannot simply send the Italian judgment to a Czech bank. You must follow the local enforcement procedure. ARROWS manages this entire "domestication" process, turning your Italian court paper into a Czech enforcement order.

The ultimate pre-emptive tool: The EAPO

The greatest risk in any debt collection case is that the debtor will empty their bank accounts, leaving you with a "paper judgment" that is worthless.

The European Account Preservation Order (EAPO) (Regulation 655/2014) is the solution.

This powerful tool allows a creditor to freeze funds in the debtor's bank accounts anywhere in the EU.

 This can be done ex parte (without the debtor knowing) and even before you file the main lawsuit, preventing the debtor from transferring assets.

This is a sophisticated tactic that ARROWS can deploy to secure your funds from the start.

Risks During the Judicial Phase

Risks and Penalties	How ARROWS Helps
The debtor files an objection (odpor) to your Payment Order. Penalty: The case moves to a full, costly, and slow trial. Your "fast track" is gone.	Representation in court. Our experienced litigators take over, building a robust case from your documentation to win the full trial. Need legal representation? Write to office@arws.cz.
The debtor transfers all assets during the lawsuit. Penalty: You win a "paper judgment" — a legal victory with no money to collect. This is a total loss.	Legal opinions & EAPO. We can apply for a European Account Preservation Order (EAPO) to freeze the debtor's bank accounts before they can move the funds. For immediate assistance, write to us at office@arws.cz.
Filing the claim in the wrong Czech court. Penalty: The case is dismissed on procedural grounds. You waste months and non-refundable court fees.	Legal analysis. We determine the correct subject-matter and territorial jurisdiction based on EU regulations and Czech law from the start.Do not hesitate to contact our firm – office@arws.cz.
You have a judgment from Italy, but it's not enforced. Penalty: Your Italian court victory is useless in the Czech Republic without the correct local enforcement procedure.	Help with regulatory approvals. We manage the full process of recognizing and enforcing foreign EU judgments under the Brussels I Regulation. Get tailored legal solutions by writing to office@arws.cz.

You won in court. How do you finally get your money?

Winning your case—either by an unopposed platební rozkaz or a full judgment—is not the final step.

This victory only gives you an "enforceable title" (exekuční titul).  It is a legal document; it is not money in your bank account.

To get your money, you must begin the Czech enforcement process, known as exekuce.

A key difference from other systems is that this process is not handled by the court. It is a privatized system managed by court-appointed private bailiffs, known as soudní exekutor.

Our specialists are here for you

The exekuce process works as follows:

1. We file an enforcement proposal on your behalf, based on your "enforceable title".
2. This proposal is submitted to a soudní exekutor (bailiff), who is then authorized by the court.
3. The exekutor has broad legal powers to seize the debtor's assets. This includes freezing and seizing bank accounts, garnishing receivables from the debtor's other clients, or placing a lien on real estate.

ARROWS provides full "representation in enforcement proceedings".

We do not just give you the judgment and wish you luck. We manage the entire process, working with our own trusted network of exekutor offices to actively screen for the debtor's assets and ensure the enforcement is carried out swiftly and effectively. 

We are your project managers for the entire recovery.

FAQ – Legal tips on the enforcement (Exekuce) process

1. Can my Italian judgment be enforced directly in Prague?

Yes. As a judgment from an EU member state, your Italian decreto is enforceable in the Czech Republic under the Brussels I Regulation. ARROWS can manage the entire local enforcement (exekuce) process for you. Need legal help? Contact us at office@arws.cz.

2. What if the debtor has no assets?

This is a key risk. Our "Legal analysis" includes investigating the debtor. We work with exekutor offices skilled at screening and locating debtor assets. If they are truly insolvent, we provide "representation in insolvency proceedings" to recover what is possible. For a legal analysis, email us at office@arws.cz.

3. How long does the exekuce (enforcement) process take?

The average time for enforcement in the Czech Republic is around 180 days. However, once a bailiff is engaged and assets are located, the seizure of a bank account can be very fast. We prioritize speed and work with efficient partners. Our lawyers are ready to assist you – email us at office@arws.cz.

Why trust ARROWS with your czech debt collection?

Our lawyers combine deep knowledge of both local foreign markets and the legal differences between the Czech Republic and other jurisdictions—especially the Czech-Italian divide we have detailed in this guide.

We are a "leading Czech law firm in Prague, EU," and a "safe European harbour" for your business. The scale of our practice proves our expertise: ARROWS lawyers support over 150 joint-stock companies, 250 limited liability companies, and 51 municipalities.

Our ARROWS International network, built over 10 years, operates in 90 countries. This global reach gives us the cross-border perspective needed to deploy sophisticated EU tools like the EAPO.

We are a full-service partner. We don't just collect debts; we provide "preparation of internal company policies," "contract drafting," and "professional training for employees" to prevent debts from happening. 

And when they do, we offer the complete solution, from "drafting legally required documentation" to "representation in court or before public authorities."

We are known for speed and high quality, and we act as your business partners in the Czech market. We can even "connect clients with each other in case of mutual business or investment interests." We welcome innovative business ideas and are here to protect yours.

FAQ – most common legal questions about Czech debt collection

1. What is the statute of limitations for a commercial debt in the Czech Republic?

The general promlčecí lhůta (statute of limitations) is three years from the day the debt was due. This is a critical difference from Italy, where the general period is ten years. Waiting is a significant financial risk. To verify if your claim is still enforceable, contact our lawyers at office@arws.cz.

2. 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 (e.g., 5% for claims over CZK 20,000). These costs are generally recoverable from the debtor if you win and if you followed the correct pre-litigation steps (the předžalobní výzva). For a detailed cost assessment of your case, email us at office@arws.cz.

3. What documentation do I need to start a claim?

A strong case requires strong evidence. This includes the original contract, all issued invoices, proof of delivery (delivery notes), and any written communication (like emails or text messages) where the debtor acknowledges the debt. Our team can review your file to build the strongest possible case. Get tailored legal solutions by writing to office@arws.cz.

4. What happens if my Czech debtor declares bankruptcy?

This is insolvenční řízení (insolvency proceedings). You must act very quickly to register your claim with the insolvency administrator. As a foreign creditor, this is extremely difficult to manage alone. We provide full "representation in insolvency proceedings" to secure your maximum possible recovery. For immediate assistance, write to us at office@arws.cz.

5. My Czech partner wants to negotiate. Should I trust them?

You should always be open to settlement, but never on the basis of a verbal promise. Any agreement must be formalized in a legally binding document (e.g., a new payment plan with penalties) drafted by a lawyer. We can draft this documentation to ensure your "amicable" solution is fully enforceable. Do not hesitate to contact our firm – office@arws.cz.

6. What is the single biggest mistake Italian companies make?

Assuming the Czech and Italian systems are the same. This leads to two costly errors: 1) Waiting too long to act, allowing the 3-year statute of limitations to expire. 2) Sending an incorrect demand letter, which forfeits the right to recover legal fees. We help our Italian clients avoid these traps. Need legal help? Contact us at office@arws.cz.

An unpaid invoice from a Czech partner is a serious drain on your business. 

Don't let cultural misunderstandings, procedural traps, or the 3-year statute of limitations make your debt unrecoverable. 

As an international law firm operating from Prague, European Union, ARROWS lawyers are specialists in Czech-Italian cross-border debt recovery. We provide the speed, local expertise, and international perspective your business needs.

Stop waiting and losing your rights. Contact our English-speaking legal team today for a confidential consultation on your case. Email us at office@arws.cz.

Don't want to deal with this problem yourself? More than 2,000 clients trust us, and we have been named Law Firm of the Year 2024. Take a look HERE at our references.