Are the managing directors liable for the company's debts?
For example, see Section 159(1) of the new Civil Code. According to it, by assuming the office, the statutory officer undertakes to perform it with the necessary loyalty and with the necessary knowledge and care. This is not so new. What is new, however, is the establishment of a rebuttable legal presumption that a person who is not capable of exercising such care, although he must have discovered this when accepting the office or when performing it, and who does not draw the consequences for himself, is acting negligently. The logic of the matter then follows that he who acts negligently is liable for damages.
It will therefore be important for you to consider whether you are really fit for the position, which will be assessed with reference to the company's field or business. But that is not all. The new Civil Code further provides (§ 159(3)) that if a statutory body (elected body) has not compensated a legal entity for damage caused by a breach of duty in the performance of its duties, although it was obliged to compensate the damage, it is liable to the creditor of the legal entity for its debt. He shall be liable to the extent to which he has failed to compensate for the damage, unless the creditor is unable to enforce performance against the legal person. In practice, this means that a managing director who does not devote himself properly to his duties may find himself liable for the company's debt without having previously undertaken to do so in writing. Effective advice is an effective defence.
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The information contained in this article is for general informational purposes only and serves as a basic guide to the issue as of 2026. Although we strive for maximum accuracy, laws and their interpretation evolve over time. We are ARROWS Law Firm, a member of the Czech Bar Association (our supervisory authority), and for the maximum security of our clients, we are insured for professional liability with a limit of CZK 400,000,000. To verify the current wording of the regulations and their application to your specific situation, it is necessary to contact ARROWS Law Firm directly (consultation@arws.cz). We are not liable for any damages arising from the independent use of the information in this article without prior individual legal consultation.