The Czech legal system is based on the codified principles of civil law. The cardinal source of law iswritten legislature and its main areas are codified. The forms of court proceedings are prescribed in ActNo. 99/1963 Coll., Civil Procedure Code ("Civil Procedure Code"), and in Act No. 292/2013 Coll., onSpecial Civil Proceedings ("Special Civil Proceedings Act"). Although judicial precedents (i.e.,interpretation by the courts) are generally non-binding, the Supreme Court of the Czech Republicregularly comments on case decisions to provide guidance and establish uniformity among the lowercourts, which are likely to adhere to these.
On 1 January 2014 the long-awaited Act No. 89/2012 Coll., Civil Code ("Civil Code") came into effect,and brought many changes into the Czech legal system. Simultaneously, the Civil Procedure Code wasrecently modified and amended. One of the most significant modifications is the change of terminology(due to the new Civil Code) and several other changes (such as which court is the court of first instancein particular cases or the modification of forms of enforcement of judgments).
Civil dispute proceedings are divided into two groups: (a) "indisputable (nesporné) proceedings", e.g.inheritance proceedings, trust fund proceedings or legal capacity proceedings, which are governed bythe Special Civil Proceedings Act; and (b) "disputable (sporné) proceedings" which are governed by theCivil Procedure Code.
Next to the regulation of civil dispute proceedings, Act No. 150/2002 Coll., Code of AdministrativeJustice also provides for the possibility to submit a claim against an administrative body.
The Czech Republic is a member of the European Union and therefore is bound by Europeanlegislature, in particular by EU Regulation No. 1215/2012 on jurisdiction and the recognition andenforcement of judgments in civil and commercial matters ("Brussels I bis") and EU Regulation No.593/2008 on the law applicable to contractual obligations ("Rome I").
The Czech Republic has a four-tier system of courts and two instance proceedings. The Czech courtsystem is composed of district courts, regional courts, two high courts, two supreme courts as well asthe Constitutional Court of the Czech Republic which stands separately from the other (i.e. general)courts. The courts in the Czech Republic operate independently from each other. The first supreme court(Supreme Court of the Czech Republic) is responsible for civil (including commercial) and criminalmatters while the second supreme court (Supreme Administrative Court of the Czech Republic) isresponsible for administrative matters (including taxes). Court proceedings are oral and public, withexemptions stated by the law (juvenile justice). The procedure is based on an inquisitorial system withfeatures of the adversarial system. There is no jury.
Each court handles civil (including labour), commercial and criminal matters. In general, cases are firstheard before the district court while the regional court serves as an appellate court. However, theregional court may also act as a court of first instance (especially in some commercial disputes) in caseswhere an appeal is decided by the high courts. Administrative proceedings are carried out by theregional and the Supreme Administrative Court. Currently in the Czech Republic, there are 86 districtcourts and 8 regional courts.
The general as well as the specific jurisdiction is stipulated in the Civil Procedure Code, in the SpecialCivil Proceedings Act and in the Code of Administrative Justice.
In appropriate cases, it is possible to submit a petition to the district or regional courts for granting interimmeasures of protection, such as a preliminary injunction.
Currently, legal proceedings in the Czech court system are generally viewed as being rather slow.Depending on the complexity of the case, a dispute may take anywhere from a few months to a coupleof years before a final settlement. Generally, under Czech civil procedure law, there are no prescribedperiods within which the courts are obliged to decide (with the exemption of procedural acts such aspreliminary injunctions or decisions in commercial register matters, etc.).
Disputes involving a claim for payment of a specific amount usually take a shorter period of time. Forexample, the court may decide to make a judgment based strictly on the application for a payment order,without a hearing or examining the defendant. The court may issue the payment order if the exercisedright follows from the facts stated by the claimant; however, an explicit demand by the claimant is notrequired, and the payment order has the same effect as a final judgment in the matter. The court mayalso issue an order to pay a bill (cheque) without a hearing, if the claimant submits an original copy of abill of exchange, or cheque, whose authenticity is uncontested. It is also possible to issue an electronicorder for payment or a European order for payment
Generally in the Czech legal system, the only legal remedy against a judgment by a court of firstinstance is an appeal. The devolutionary effect of the appeal applies under Czech law. This means thatthe contested decision of a lower level court will be resolved by the appellate court; however,reconsideration is possible, and certain appellate decisions can be resolved by the first instance court.
A party may appeal most decisions of the first instance courts. On appeal, a party may challenge anyprocedural irregularities or the erroneous application of substantive law, and in some very rare andspecific situations it may be possible to offer new facts and evidence in support of the appeal.
The court of second instance will either deny or allow the appeal. If the appeal proceeds, the court willreview the factual and legal aspects of the case which have been considered by the court of firstinstance, and may accept new facts and evidence. The court is not restricted by the submission of theappellant, nor is the court bound by the reasoning stated in the appeal. The court is only bound by thescope of the appeal. According to the rules of appellate procedure, after reconsidering the relevant facts,the court will either (i) affirm the first instance judgment; or (ii) overrule the judgment and change theruling. Furthermore, the appeal court can annul or vacate the previous decision and remand the matterto the court of the first instance, or terminate the proceeding.
In addition to the appeal procedure which is an ordinary remedy, Czech law allows the use ofextraordinary legal remedies under a strictly defined set of conditions such as: revision (pertaining tolegal aspects), petition for retrial (dealing with factual aspects), and petition for nullity (dealing withprocedure aspects).
Court fees are based on the Court Fees Act and depend on the amount in dispute. If the amount indispute is:
-up to CZK 20,000, the court fee is CZK 1,000;
-from CZK 20,000 to CZK 40,000,000, the court fee is 5% of the total value of the claims;
-higher than CZK 40,000,000, the court fee is CZK 2,000,000 and 1% of the value exceeding CZK40,000,000. The value higher than CZK 250,000,000 is not taken into account.
Litigation costs mainly include court costs, attorneys' fees, and expenses for expert opinions, evidenceand language translations/interpretations, which are normally paid by the unsuccessful party.
Any individual that receives a valid judgment and is entitled to request performance of the judgment fromanother person may, in the absence of voluntary execution or performance within the period specified inthe judgment, file a petition for enforcement of the judgment. The execution can be carried out on thebasis of a court order or with a private (self-employed) judicial executor. There are also severalpecuniary forms of judicial enforcement including wage deductions, an order to pay from an account at aspecified financial institution, a sale of assets, a sale of enterprise, a sale of movable assets and realestate, management of real estate or a judicial lien. In addition, there are non-monetary forms ofenforcement that include clearance of real estate, seizure of property, division of common property,performance of works or suspension of a driving license.
The legal provisions covering business crimes went through an enormous development lately. The areaof business crime and the criminal offences falling within this area have been extended and the sanctionsmade more restrictive. Concurrently, the criminal liability of legal entities has been introduced by Act No.418/2011 Coll, on Corporate Criminal Liability. In cases of fraud (in particular credit fraud), embezzlement,bribery, or breach of duty in property administration, business crime plays a substantive role in the CzechRepublic.
In comparison with civil proceedings, criminal proceedings are distinctly faster and also cheaper (thereare no court fees). Parties attempt to initiate criminal proceedings for various reasons; one reason is oftento get hold of information which only the State Prosecutor can access and which would be otherwiseunknown to the victim of the crime. Thus, business crime victims often initiate criminal proceedings togain access to evidence, in order to use this in civil proceedings (which may be carried on concurrently).
The victim claiming damages in the criminal proceeding does not need to specify the amount ofdamages and if the harm is proven, the proceedings to recover damages are usually very fast.
In criminal cases there are also two instances; whereby an appeal against the first instance decision ispossible. Nevertheless, there are no separate criminal courts in the Czech Republic for particular crimes.Criminal cases are decided by specialized judges and panels. In the Czech Republic criminalproceedings are initiated by the police, as the police are obliged to conduct all necessary investigationsto reveal the fact that a crime was committed. Anyone may file a criminal complaint of a crime beingcommitted to the State Prosecutor's Office or to the police, in which case the police are supervised bythe State Prosecutor. If the justified facts suggest that a crime was committed, the police initiate thecriminal prosecution immediately. A copy of the decision to initiate the criminal prosecution is served tothe accused no later than the beginning of the first interrogation and within 48 (forty eight) hours to theState Prosecutor and the defence counsel.
The preliminary proceedings are led by the State Prosecutor and only he/she can either submit theindictment to the court, in case he/she has enough evidence proving the guilt of the accused, ordiscontinue the criminal proceedings.
After studying the indictment submitted by the State Prosecutor, the judge orders a trial (hlavní líčení).The trial is the most important part of the criminal prosecution. Within the proceedings the StateProsecutor is obliged to prove the guilt of the accused while the principle indubio pro reo applies – if theauthorities cannot sufficiently prove the facts, it shall be assumed that the facts are not proven. Theaccused has the right, but not an obligation, to prove his/her innocence. The judge evaluates theevidence (e.g., examination of witnesses, examination of the accused, expert opinions). In businesscrime proceedings the most important evidence includes the examination of witnesses, expert opinionsand economic analyses – it is often important to prove the correctness of final accounts, or othersophisticated economic evidence. Moreover it is very important to establish whether the offence wasintentional or caused through negligence. The trial ends with a judgment – either a guilty verdict (asentence) or a verdict of not guilty (an acquittal) or another procedural decision (e.g. abatement,postponement or settlement if possible).
A guilty verdict may be appealed by the accused or by the State Prosecutor, while an acquittal may beappealed only by the State Prosecutor. The accused can appeal the decision of the court of lowerinstance before the court of higher instance (e.g. from the district court to the regional court).
The appellate court reviews the legality and justification only of those sentences of the judgment againstwhich an appeal was filed, including the correctness of the criminal proceedings in terms of allegederrors. The appellate court can (a) uphold the appeal; or (b) revoke the contested judgment.Furthermore, the appellate court may deviate from the factual findings of the court of the first instanceonly if it presents important evidence for the factual findings which were already presented during themain trial, or if it presents new evidence.
The criminal law enforcement authorities are the court, the State Prosecutor and the police. Simplecases before the district court are decided by sole professional judges and in difficult cases by a panel ofone professional judge and two lay judges. The main "player" is the State Prosecutor, which is the onlybody capable of bringing a criminal action – the indictment. The organization of the State Prosecutor'sOffice corresponds to the organization of the courts (i.e. district, regional, high and Supreme StateProsecutor's Office). The State Prosecutors' Office is a part of the Ministry of Justice.
If the business crime caused damages, the injured party may ask for a remedy within the criminalproceedings (adhezní řízení) or may initiate separate civil proceedings. The surrender of the unjustenrichment may also be required. Civil and criminal proceedings may therefore run concurrently. Thecourt in the civil proceedings is bound by the verdict of the criminal court. Under the Act No. 45/2013Coll., on Victims of Crimes, effective from 1 August 2013, a new specific role of the "victim" wasestablished. The main difference between a victim and an injured party is that a victim may only be anindividual and thus in a specific situation a bereaved person may also be considered a victim. Under thisAct the victim of a business crime benefits from new rights. For example, the victim may make astatement regarding the impact of the crime on his/her life which may help the court to decide about theappropriate and fair judgment. Moreover, the victim may be defended by a principal for free (newly, theprincipal may be a legal entity or an organization specialized in providing social services). In addition tothe defending principal the victim may also have a confidant who helps the victim to deal with theconsequences of the crime.
Every party may apply for the production of evidence in criminal proceedings, i.e., the State Prosecutor,the accused, or the victim. The judge can even call for the production of evidence which nobody appliedfor. The judge decides if the production of evidence is important, or if this is redundant and thereforemerely an obstruction to the proceedings.
The victim may (if approved by the judge) question the accused, but only after the judge has alreadyfinished the examination.
Interim injunctions may be granted during the proceedings. These represent an enumerative area ofduties that the court may grant to the accused within the criminal proceeding. The aim of these interiminjunctions is to secure the rights and freedom of the victim such as life, freedom or human dignity. Thecourt can grant interim injunctions only if there is enough evidence proving the guilt of the accused.Types of interim injunctions include e.g. a ban on contact with the victim, a ban on entry into a commonresidence with the victim or a ban on traveling abroad.
If the documents were legally gained within the criminal proceeding, they can be used further in the civilproceedings. The principle of free evaluation of the evidence (zásada volného hodnocení důkazů)applies particularly in the criminal proceedings. Therefore, the evidence might be anything which is ableto contribute to the clarification of the crime and which is admitted by the court as evidence.
Compared to civil proceedings criminal proceedings are usually significantly faster. Generally, the timeframe for the criminal proceeding depends on the complexity and the uniqueness of the case. Simplecases are decided by the court of first instance within 1 (one) year and by the appellate court within 18(eighteen) months. Complex cases, especially those regarding business, may take a longer time. Thecourt itself is not bound by any statutory period of time.
Contrary to civil proceedings, in criminal proceedings court fees do not exist; ergo criminal proceedingsare initiated ex officio. On the other hand, the accused has to bear the costs for any expert's opinion (ifnot required by the court itself) and the attorney's fees. The attorneys specialized in criminal proceedingsmay bill their hourly rate to the client, but the court will adjudicate only a fee prescribed by the secondarylegislation.
Corporate Criminal Liability
The Act No. 418/2011 Coll, on Corporate Criminal Liability, effective from 1 January 2012 implementedthe requirements set out by EU Directive 2009/52/EU, so called "direct liability of legal entities". Underthis Act, a legal entity may be prosecuted if the crime has been committed by one of the persons listed inthis Act and which is imputable to the legal entity. The commitment of a crime by actions of (a) astatutory body of the legal entity; (b) a member of the statutory body; (c) a person acting in a managerialcapacity carrying out management or control activities; or (d) a person exercising a decisive influenceover the management of the legal entity is imputable to the legal entity.
The commitment of a crime by an employee or a person having a similar status is imputable to the legalentity only if (a) this person has acted according to the instructions of the above-mentioned bodies orpersons; (b) the above-mentioned bodies or persons have not performed sufficient control over theactivity of employees or other subordinates; or (c) have not taken sufficient measures to avoid or avertthe consequences of the committed crime.
All crimes as set out in the Criminal Code give rise to prosecution with the exception of those crimesenlisted in an enumerative list contained in this Act.
Legal entities are mostly subject to financial sanctions for any violation of the law. The ultimate sanctionis the dissolution of the legal entity.
According to publicly accessible information only very few proceedings with legal entities are waiting tobe heard before the courts in the Czech Republic at the moment.
According to the insolvency law (Act No. 182/2006 Coll. the Insolvency Act), a debtor is bankrupt if it haspayable financial liabilities in arrears more than 30 (thirty) days and is unable to satisfy these obligations. Anentrepreneur or other legal entity is considered bankrupt if it has become over-indebted, i.e., the debtor'sliabilities exceed the debtor's assets. In all situations, the Insolvency Act requires a plurality of creditors.
An application for the opening of insolvency may be filed either by the debtor itself or by any of itscreditors. The Insolvency Act incorporates several forms of solutions to insolvency, including: (a) straightbankruptcy proceedings (Konkurs); (b) reorganization (Reorganizace); (c) debt relief or discharge fromdebts (Oddlužení); and (d) special forms of insolvency solutions (e.g. insolvency of a financial institution).In addition to the new forms of solutions to insolvency, the Insolvency Act implements the use of theInsolvency Register, which is a public register that contains a list of debtors and creditors and thedocumentation related to each insolvency case.
Insolvency proceedings are published on the website of the Czech Ministry of Justice athttp://www.justice.cz.
The insolvency courts are not separate courts; instead, they are specialized departments within theregional courts. The role of the insolvency courts is to supervise and approve any measures undertakenby the insolvency receiver and the creditors. The ultimate aim of the bankruptcy is to achieve aproportional satisfaction of the creditors from the debtor's property belonging to the bankruptcy estate.
On the other hand, reorganization serves the satisfaction of creditors by preservation of the debtor’sbusiness. In general, a reorganization is possible only for large debtors whose total annual net turnover inthe previous accounting period has reached at least CZK 50 million (i.e. approximately EUR 2 million), orfor those that employ more than 50 employees. With the consent of the majority of secured and unsecuredcreditors, reorganization is also permissible for smaller companies subject to other conditions.
The debt relief is applicable only to non-business debtors and makes available a discharge from thebalance of the debtor's liabilities, provided that a part (at least 30%) of the debts is repaid.
Arbitration in the Czech Republic is governed by Act No. 216/1994 Coll., on Arbitration Proceedings andthe Implementation of Arbitral Awards (Arbitration Act) and applies to both domestic and internationalarbitration proceedings.
Under the Arbitration Act, a permanent court of arbitration may only be established by an Act ofParliament (Article 13 Arbitration Act). A permanent arbitration court is empowered to enact its ownstatute and rules of arbitration, which shall be published in the Commercial Bulletin.
Currently, three permanent arbitral institutions have been founded in the Czech Republic, the mainone of which is the Arbitration Court attached to the Economic Chamber of the Czech Republic andthe Agricultural Chamber of the Czech Republic (the “Arbitration Court”), founded in 1949. The othertwo are the Exchange Court of Arbitration and the Arbitration Court of the Czech Moravian CommodityExchange Kladno.
The Arbitration Court is the major permanent arbitral institution in the Czech Republic and administers bothdomestic and international disputes. It adopted its Rules of the Arbitration Court effective as of 1 July 2012and also offers several rules for specific cases such as Additional Procedures for On-line Arbitration Rulesfor Domestic Healthcare Payments Disputes, Additional Procedures for Consumer Disputes or Rules
for .cz domain name dispute resolution. The Arbitration Court is the only arbitration court in the world
for .eu domain name dispute resolution. All currently effective Rules and Additional Procedures, with theexemption of those applicable to consumer and healthcare payments disputes, are available in English onthe Arbitration Court’s website (http://en.soud.cz/rules). The rules differ on various issues includingprocedure, fees charged and the language and place in which proceedings are heard.
Pursuant to the Arbitration Act, the parties may conclude an arbitration agreement that governs any or alldisputes between them arising from their contractual relationship. In the agreement, the parties mayagree whether the arbitration shall be decided by one or more arbitrators, or by an established arbitralinstitution. The parties may also specify in their agreement what procedural rules, or substantive law willapply to the resolution of the dispute.
The parties may agree to arbitrate disputes that have already arisen (compromise or submissionagreement), or disputes that may arise in the future. However, in order for an arbitration agreement tobe valid, it must be concluded in writing between the parties. The written component is deemed to bemet if the agreement is contained in a telegram, a telex or another electronic means ofcommunication. The agreement does not have to be signed, but the will of both parties to enter intothe agreement must be clear.
Since the Act No. 257/2016 Coll., on Consumer Credit ("Consumer Credit Act"), came into effect on 1December 2016, a total ban has been introduced on arbitration as a dispute resolution mechanismbetween credit providers and consumers. From this time onwards, all consumer credit disputes may beresolved by civil courts only.
In arbitration proceedings, decisions regarding property disputes can only be issued in: (a) disputeslinked to the enforcement of the decision; (b) disputes arising within the course of insolvencyproceedings; and (c) competence disputes. Disputes relating to personal status, marital status, familylaw matters and administrative matters are not arbitrable.
The parties are free to agree on the substantive law, the procedural rules, the seat and language ofarbitration. In addition, the parties are free to agree on the number of arbitrators and their method ofappointment. However, there must always be an odd number of arbitrators.
Arbitral tribunals do not have the authority to order interim measures of protection, or to grant injunctionsin support of the enforcement of arbitral awards. Article 22 of the Arbitration Act therefore provides thecourts with jurisdiction, upon application by any party, to order a preliminary measure or injunction if,during or prior to the commencement of arbitration proceedings, circumstances arise which are likely tojeopardize the enforcement of the arbitral award.
Generally, arbitral awards are enforceable by the courts and private (self-employed) judicial executors inthe same manner as court judgments.
Arbitral awards may very rarely be challenged before the courts. The valid grounds for setting aside anarbitral award include the following:
-the award has been issued in a case in which no valid arbitration agreement has been concluded(lack of jurisdiction);
-the arbitration agreement is not valid for other reasons, has been terminated or does not concern thesubject matter in dispute (lack of competence);
-an arbitrator participated in the arbitration proceedings whose appointment was neither based on thearbitration agreement nor on any agreement between the parties, or the individual appointed as thearbitrator did not possess the legal capacity to act as arbitrator;
-the award was not adopted by a majority of the arbitrators;
-a party was not given the opportunity to plead its case before the arbitral tribunal;
-the award obligated a party to an action that was not requested by the other party, or to an actionwhich is not permitted under domestic law; or
-it is determined that reasons exist, which provide a sufficient justification for reopening the case.
Council Regulation 1215/2012 deals with the recognition and enforcement of judicial decisions in civiland commercial matters. According to this Regulation, decisions issued by a court of any EU MemberState shall be recognized by other EU Member States without a special procedure. Czech judicialdecisions dealing with civil and commercial matters that were issued prior to the Czech Republic's entryinto the EU, and decisions given in connection with proceedings initiated before entry into the EU,cannot normally be enforced in any other EU Member State.
Furthermore, since 21 October 2005 and the enactment of EC Regulation No. 805/2004 of the EuropeanParliament, any European Enforcement Order for an uncontested claim is valid in the Czech Republicunless:
-pursuant to Act No. 91/2012 Coll., on International Private and Procedural Law effective from 1January 2014, the provisions of the Act shall apply unless an international treaty or European lawbinding on the Czech Republic stipulates otherwise. Pursuant to the Czech Act on InternationalPrivate and Procedural Law, decisions of foreign authorities as well as foreign judicial settlements andforeign notary deeds shall be effective in the Czech Republic if they are final and conclusive,confirmed by the foreign authority and recognized by Czech authorities. However, foreign decisionsshall not be recognized or enforced if the foreign decision impedes the exclusive jurisdiction of theCzech Courts, the proceedings could not have been conducted under the authority of the foreignstate; and, the provisions concerning the competence of the Czech Courts have been applied to theconsideration of jurisdiction of the foreign authority;
-a final and conclusive decision has been issued by Czech authorities, or a final and conclusivedecision of an authority of the third state has been recognized in the Czech Republic;
-the authority of the foreign state failed to allow the party against whom the judgment or the award is tobe enforced, to participate in the proceedings, especially if the participant was not personally servedwith notice of the lawsuit or the writ of summons;
-recognition of the foreign award would violate Czech public order; or,
-reciprocity of the award is not guaranteed, or reciprocity is not required because the foreign decisionis not directed against a Czech citizen or a Czech legal entity, or if a Czech legal entity has agreed inwriting that the foreign court has a competence (property disputes).
Pursuant to the Czech Act on Arbitration, arbitral awards issued abroad shall be recognized and enforcedby Czech Courts in the Czech Republic if reciprocity is guaranteed. Recognition of a foreign arbitral awarddoes not require a special decision. The courts may only decline to recognize and enforce the foreignarbitral award under limited conditions based on the petition of the party obliged by the award.
The Czech Republic is a party to the New York Convention of 1958 on the Recognition and Enforcementof Foreign Arbitral Awards, with the reservations that the Convention will only be applied to therecognition and enforcement of awards made in the territory of another contracting state and with regardto awards made in the territory of non-contracting states, the Convention will only be applied to theextent to which those states grant reciprocal treatment.
The Czech Republic is also a party to the 1961 European Convention on International CommercialArbitration.
The Czech Code of Civil Procedure does notprovide for a special proceeding for collectiveredress. Consumer organizations may file, onbehalf of consumers, claims against unlawfulbehaviour. However they cannot sue for damages.In such cases, each consumer must file a separateaction.
Class actions are not permitted in the CzechRepublic.
Pro Bono System
In civil litigation (in particular in case of actions forperformance), the court adjudicates on the basisof evidence submitted/offered by the parties. Innon-contentious proceedings (e.g. proceedingson personal status), evidence may be producedeven though the parties do not offer to presentevidence.
-The duration of court proceedings depends onthe number of hearings and the extent ofevidence.
-A third instance is not permissible in the CzechRepublic. A legally effective judgment may becontested by so called appellate review in theSupreme Court. The appellate review is anextraordinary remedy.
Simple cases: first instance: 1 year; secondinstance: 8 to 12 months.
Complex cases: first instance: 1 to 2 years:second instance: 1 to 2 years.
Yes. The law prescribes compulsory representation by an attorney-at-law in cases of appellate reviewproceedings at the Supreme Court.
Yes. There is legal aid for people who cannot afford the costs of legal proceedings. Legal aid ex officio isprovided for by the Czech Bar Association and governed by the Bar Act.
Court fees are based on the Court Fees Act. Ingeneral, the court fee is calculated based on theamount in dispute. If the amount in dispute is:
-up to CZK 20,000, the court fee is CZK 1,000;
-from CZK 20,000 to CZK 40,000,000, the courtfee is 5% of the total value of the claim up to amaximum amount of CZK 2,000,000;
-above CZK 40,000,000, the court fee is CZK2,000,000 plus 1 % of the value exceedingCZK 40,000,000. A value higher than CZK250,000,000 is not taken into account.
Court fees for electronic compulsory paymentorders also depend on the amount in dispute. Ifthe amount in dispute is:
-up to CZK 10,000, the court fee is CZK 400;
-from CZK 10,000 to CZK 20,000, the court feeis CZK 800;
-above CZK 20,000, the court fee is equal to4%.
The electronic compulsory payment order may beissued only if the amount in dispute does notexceed CZK 1,000,000
Assumptions based on an amount in disputeof EUR 1,000,000:first instance: preparation ofthe claim/responses, court hearings, preparationof the hearings (meetings with client, witnesses,correspondence with client): In total EUR 25,000to 40,000; second instance: preparation of theappeal/responses, court hearing: In total EUR7,000 to 15,000.
Assumptions based on an amount in disputeof EUR 10,000,000:first instance: preparation ofthe claim/responses, court hearings, preparationof the hearings (meetings with client, witnesses,correspondence with client): In total EUR 50,000to 200,000; second instance: preparation of theappeal/responses, court hearings: In total EUR20,000 to 50,000.
There are no civil jury trials in Czech Republic.
-Documents shall be submitted in Czech. Czechtranslations must be attached to documents inforeign languages.
-The court is entitled to ask the parties or thirdparties to submit other documents besidesdocuments referred to as evidence.
-One copy of documents (documentaryevidence) shall be submitted to the court. Thecounter-party is obliged to make their owncopies using the copies from the court file at itsown expense.
STANDARD CIVIL PROCEEDINGS
-Litigation costs include court fees, attorneys'fees, and expenses for expert opinions andwitnesses.
-Court fees at the first and second instances aredue at the court's request after the action/ap-peal has been filed.
-Court fees exceeding CZK 5,000 must be paidby bank transfer to the court's bank account.Court fees not exceeding CZK 5,000 may bepaid by duty stamps.
-Litigation costs are awarded against the losingparty who must reimburse the winning party.
-The actual attorney fees of a party (dependingon the fee agreement between attorney andclient) may be substantially higher, but are ofno relevance to the opposing party.
Pro Bono System
The accused shall be represented by counsel if
-the accused is (a) in custody, prison or protective treatment; (b) incapacitated or deprived of full legalcapacity by a court decision); or (c) fugitive;
-if an agreement on guilt or punishment is being negotiated;
-if the court decides on extradition, transfer to another EU Member State, enforcement of a foreigncriminal law decision or imposition of protective treatment; or
-if the offence is punishable with a minimum of five years of imprisonment (the accused may forfeithis/her right to the mandatory defence).
Each court has a list of counsels from which the counsels are chosen.
-Documents shall be submitted in Czech. Czechtranslations must be attached to documents inforeign languages.
-The court is entitled to ask the parties or third par-ties to submit other documents besides docu-ments referred to as evidence.
-Copies of documents (documentary evidence)shall be submitted to the court. The counter-partyis obliged to make their own copies using thecopies from the court file at its own expense.
The principle of free evaluation applies in criminalproceedings. Everything that can contribute to solv-ing the crime may be submitted as evidence.
Class actions are not permitted in the Czech Republic.
Criminal proceedings are significantly faster thanstandard civil proceedings, but in very complexcases (e.g., in cases of business crime) theproceedings may be much longer.
There are no court fees.
The accused may bear the costs for experts' opinions and attorney's fees. On the other hand, the attor-neys may bill in accordance with the secondary legislation and not their usually hourly rate.
There are no jury trials in the Czech Republic.
Simple cases: first instance: 6 months; secondinstance: 1 year.
Complex cases: first instance: 1 year; secondinstance:1 to 1½ years.
The motion for preliminary injunction must beaccompanied by all the evidence that theapplicant bases the motion on.
For the purpose of securing damages thatcould arise as a result of preliminary injunction,the applicant is obliged to deposit a returnablesecurity in the amount of CZK 10,000 at thecourt. In commercial matters, the amount isCZK 50,000.
Court fees are based on the Court Fees Act andamount to approximately CZK 1,000.
Assumptions: only the request for apreliminary injunction is filed: first instanceEUR 3,000 to EUR 7,000; second instance:preparation of the appeal/responses, no courthearing: EUR 3,000 to EUR 6,000.
Assumptions: the request for a preliminaryinjunction is filed, meeting with the client: firstinstance: EUR 15,000 to EUR 30,000; secondinstance: preparation of the appeal/responses,meeting with the client: EUR 7,000 to EUR15,000.
Preliminary Injunction Proceedings
First instance: the court shall make a decision nolater than 7 days after the motion for a preliminaryinjunction has been filed; appellate proceedings:2 to 8 months in second instance.
The arbitral tribunal evaluates all produced documents. The documents shall be submitted in thelanguage in which the arbitration proceedings are conducted.
Arbitration fees are based on the Rules for Costsof Arbitration Proceedings and depend on theamount in dispute.
The following two estimates are based on theRules for Costs of Arbitration Proceedings at theArbitration Court attached to the Economic Cham-ber of the Czech Republic and to the AgriculturalChamber of the Czech Republic:
Assumption: sole arbitrator appointed and anamount in a dispute of EUR 1,000,000:
domestic disputes: arbitration fee EUR 30,000;
international disputes: arbitration fee (reduced by30%) EUR 18,500 plus administrative fee (re-duced by 20%) EUR 15,000.
Assumption: sole arbitrator appointed and anamount in a dispute of EUR 10,000,000:
domestic disputes: arbitration fee EUR 40,000;
international disputes: arbitration fee (reduced by30%) EUR 74,500 plus administrative fee (reducedby 20%) EUR 26,500.
-The procedural costs depend on whether asole arbitrator or an arbitral tribunal of threemembers is appointed, the complexity of thecase, and the administrative charges.
-Arbitration costs are awarded against thelosing party who must reimburse the winningparty.
-Arbitration costs include fees, attorneys' feesand expenses for expert opinions andwitnesses.
-The action shall not be tried until the feesare paid.
-In general, a special tariff for arbitration feesand administrative fees (lump-sumreimbursement of the costs of the arbitrationcourt) applies to international disputes; indomestic disputes, the arbitration fees are5% of the disputed amount, subject to a capof CZK 1,000,000 (approx. EUR 40,000).The arbitration fee for domestic disputes in aforeign language is 50% higher.
-The fee for accelerated arbitrationproceedings is 50% higher (acceleratedproceedings take approx. 3 months indomestic disputes and 4 months ininternational disputes).
-If a sole arbitrator is appointed in aninternational dispute, the arbitration fee isreduced by 30% and the administrative fee isreduced by 20%.
Assumptions based on an amount in disputeof EUR 1,000,000: preparation of the arbitrationclaim/responses, review of 100 pages ofdocuments, nomination of the arbitral tribunal,preparation of the hearings (meetings with client,witnesses, correspondence with client): in totalEUR 28,000 to EUR 60,000.
Assumptions based on an amount in disputeof EUR 10,000,000: preparation of the arbitrationclaim/responses, review of 500 pages ofdocuments, nomination of the arbitral tribunal,preparation and review of expert opinions,preparation of hearings and participation inmeetings, meetings with the client, witnesses,and correspondence with client: in total EUR50,000 to EUR 200,000.
The duration of arbitration proceedings can alsobe influenced by an agreement to have thearbitration award reviewed by a new arbitraltribunal.
The usual duration of arbitration proceedings isbetween 6 months and 2 years.
-Judgments that fall outside the scope ofapplication of the EC Regulation/LuganoConvention must be submitted in the original orin a copy issued by the court that rendered thejudgment. A certified translation of thejudgment must be submitted.
-For enforcement of awards under the NewYork Convention, the creditor must provide thecourt with the authenticated original award or aduly certified copy thereof and the original ofthe arbitration agreement or a duly certifiedcopy thereof.
Enforcement of Foreign Judgments and Arbitral Awards
The court fees are based on the Court Fees Act.
In case of monetary performance, the fee iscalculated based on the amount in dispute. If theamount in dispute is:
-up to CZK 20,000, the court fee is CZK 1,000;
-from CZK 20,000 to CZK 40,000,000, the courtfee is 5% of the total value of the claims up to amaximum amount of CZK 2,000,000;
-above CZK 40,000,000, the court fee is CZK2,000,000 and 1 % of the value exceeding CZK40,000,000.
A value higher than CZK 250,000,000 is not takeninto account.
Court fees in cases of non-monetaryperformance:
-clearance of real estate: CZK 5,000;
-other forms of enforcement: CZK 2,000
Application for recognition/enforcement of aforeign judgment:
Simple case: EUR 500 to EUR 1,000.
Complex case: EUR 1,000 to EUR 3,000.
6 to 12 months until a decision on recognition andenforcement is rendered in first instance. 5 to 10months if the decision is appealed.
The duration of execution proceedings dependsmainly on whether the debtor has executableassets and whether execution measures areopposed by the debtor.
-Under EC Regulation 44/2001 and theLugano Convention, the party seekingrecognition/ enforcement must submit a copyof the judgment which should beaccompanied by a Certificate of Authenticityissued either by the court that rendered thejudgment or by another competent institutionof the state of origin.
-Further, in order to avoid any delays,attaching a certified translation of thejudgment is highly recommended.
There is no fee for filing the petition for thecommencement of insolvency proceedings.
Filing of insolvency claim:
Simple case: EUR 600 to EUR 1,000.
Complex case: EUR 1,000 to EUR 3,000.00.
The commencement of insolvency proceedingsis published by edict (e.g., on the website of theCzech Ministry of Justice underhttp://www.justice.cz). In the edict, the period forthe filing of insolvency claims is set.
If a debtor files an insolvency petition, the duty tomake an advance payment for the costs of theinsolvency proceedings amounting up to CZK50,000 may be imposed on the debtor.
Filing ofInsolvency Claimsby Creditors
6 months to several years.
The insolvency proceedings are initiated on theday of service of the insolvency petition at theinsolvency court. No decision on thecommencement of insolvency proceedings ismade, only a notice is published in the InsolvencyRegister.