How to successfully collect your company's debts in 2026

Summary

As of 1 October 2026, the statutory rules on the central register of enforcement wage garnishments are in effect. It is kept by the Chamber of Enforcement Officers, and data is entered into it by employers who register with it at their own request. The enforcement officer can thus find out more quickly what income the debtor has, how much is already being deducted from their wages, and what ranking the individual enforcement proceedings have. The basic rules for recovering commercial receivables in the Czech Republic, i.e., the pre-action demand letter, the payment order and limitation, did not change in 2026. Default interest changes every half-year according to the Czech National Bank repo rate.

Prevention is often cheaper than court proceedings. A well-drafted contract, a contractual penalty, an arbitration clause, and timely communication can save you months of waiting and significant costs for attorneys and enforcement officers.

Time limits are also critical. A claim becomes time-barred after 3 years, a pre-action demand letter must be sent at least 7 days before filing a lawsuit, and an electronic payment order is decided by the court without a hearing, which is why it tends to be faster than a standard lawsuit. Underestimating deadlines can be costly.

Do not forget the ancillary elements of the claim either. Statutory default interest is 11.50% per annum if the default arose in the first half of 2026, and 11.75% per annum if it arose in the second half of 2026. Together with contractual penalties and legal costs, it can significantly increase the amount you can claim.

Legal framework for debt recovery in 2026

The basic rules for recovering commercial receivables remain the same in 2026: a pre-action demand letter, a payment order or a lawsuit, and finally enforcement. However, some changes are worth keeping in mind.

The most important new development is the central register of enforcement wage garnishments, the statutory rules on which are in effect from 1 October 2026. It is kept by the Chamber of Enforcement Officers. Employers who register with it enter into it, among other things, the amount of the debtor’s net wage, the deductions made, and the data decisive for the ranking of claims. Both the enforcement officer and the court have remote access to this data. For creditors, this means faster information on whether and how much can be recovered from the debtor’s wages.

If your debtor is an entrepreneur in temporary difficulties, they have been able to use preventive restructuring since September 2023. This involves negotiating with creditors on a restructuring plan, which may be confirmed by a court; it is not insolvency proceedings. If the plan concerns you, you can take part in the negotiations on it – which can get your money back faster than insolvency.

You can also sell (assign) the receivable. This means that if you do not want to recover the receivable yourself, you can sell it to specialists – factoring companies or other commercial companies – and avoid lengthy court proceedings.

For commercial receivables, assignment is governed by the general rules of the Czech Civil Code. The new special rules effective from 1 January 2026, i.e., consideration paid only by cashless transfer and the receivable passing only once it has been paid for, apply only to claims for maintenance determined by a court.

Key recovery steps: from a demand letter to enforcement

Debt recovery in a company usually takes place in three main phases. Knowing them and having them properly handled from a legal perspective pays off, because each phase has its pitfalls and conditions for success.

Pre-action demand letter – the last chance for an out-of-court solution

Everything starts with a pre-action demand letter, which you send to the debtor in writing, ideally by registered mail. From our experience, a large percentage of cases are resolved after the first letter – if it is properly drafted and sufficiently persuasive.

The pre-action demand letter must contain an exact description of how the claim arose (contract no. X, invoice Z dated, etc.). You must also state the total amount due and the payment deadline. The law does not prescribe its length; we recommend at least 7 days so that the payment deadline expires before the lawsuit is filed. Clear payment details (your account number) and a warning about accruing default interest and legal costs are also important.

If you do not send this letter at least 7 days before filing a lawsuit, the court will generally not award you reimbursement of legal costs, even if you win. This is one of the most common mistakes we see.

Filing a lawsuit – when to go to court

If the debtor does not respond to the letter, court proceedings are next. You essentially have two options: a standard lawsuit or an electronic payment order (EPO), which is usually a faster procedure.

An electronic payment order is ideal for straightforward monetary debts where it is clear that the debtor truly owes the money (you have an invoice, a contract, everything is in order). The court issues it without an oral hearing. The debtor has 15 days from service to pay or file an objection.

If the debtor does not file an objection in time, the payment order has the effects of a final judgment, and once the period for performance has expired you can file a motion for enforcement. An advantage of the EPO is also a lower court fee: for a claim up to and including CZK 10,000, you pay CZK 400; above CZK 10,000 up to and including CZK 20,000, CZK 800; and above CZK 20,000, 4% of the amount claimed. By comparison, for a standard lawsuit the fee is CZK 1,000 up to CZK 20,000 and 5% of the amount above CZK 20,000 up to CZK 40 million.

Note: if the court does not issue the electronic payment order and continues the proceedings, it will charge you the additional fee up to the amount applicable to a standard lawsuit.

If the matter is more complex, or if the debtor challenges the EPO, the proceedings will move to a standard civil action. In that case, you should be represented by an attorney – in disputes between businesses, courts expect a higher quality of argumentation and evidence.

Enforcement – compelling performance

Once you have an enforceable decision (a payment order or a judgment), you can file a motion for enforcement. As of 1 October 2026, the central register of deductions is used by law for enforcement by wage garnishment, which is intended to speed up the exchange of information between the enforcement officer and the debtor’s employer.

An employer registered with the Chamber of Enforcement Officers enters data on wages and deductions in the register, and the enforcement officer reads it from there. For 6 months from the entry, the enforcement officer generally does not have to request it separately from the employer.

In addition to wage garnishment, the enforcement officer may target, for example, the debtor’s bank account (attachment of a claim from an account), the debtor’s other receivables, movable and immovable assets, or the debtor’s business enterprise. The enforcement officer may also suspend the debtor’s driving licence. The method of carrying out the enforcement is determined by the enforcement officer.

In many cases, the creditor and the debtor can sit down at the negotiating table even during enforcement proceedings and agree on instalments. Even during enforcement, it is possible to conclude an instalment agreement, which often leads to faster repayment than waiting additional months for the outcome of the enforcement.

Ancillary claims (accessories) of the receivable

When you are collecting a receivable, it is not only about the original amount (the principal). You may also claim its accessories, i.e., ancillary claims related to the debt.

Default interest

If the debtor fails to pay on time, default interest is calculated from the first day of delay. The rate is determined by the Czech National Bank repo rate in force on the first day of the half-year in which the default arose, increased by 8 percentage points (Government Regulation No. 351/2013 Coll.). For default arising in the first half of 2026, it is therefore 11.50% per annum (3.50% + 8 p.p.), and for default arising in the second half of 2026, 11.75% per annum (3.75% + 8 p.p.). The rate applies for the entire period of default.

Example: The debtor is to pay CZK 100,000 no later than Monday, 2 March 2026, but pays only on 20 April. The debtor is in default for 49 days (from 3 March to 20 April) and the default interest amounts to CZK 1,543.84. You are entitled to this interest by operation of law even if it was not expressly stated in the contract or on the invoice.

However, if you want to agree on a different (e.g., higher) rate, it must be expressly agreed in the contract.

Contractual penalties

If you agreed with the debtor on a contractual penalty (e.g., 0.5% of the outstanding amount for each day of delay), you can enforce it as part of the receivable. The court may reduce it only at the debtor’s request if it considers it unreasonably high.

It is important to state clearly in the contract whether the contractual penalty replaces the right to damages (in which case damages cannot be claimed in addition), or whether it does not affect the right to damages. In that case, you can claim both the contractual penalty and damages. If the contract does not address this, the law provides that the contractual penalty excludes damages arising from the same breach.

Collection costs

As a creditor, you may also claim reimbursement of legal representation costs, enforcement costs, and reimbursement of the costs associated with asserting the claim. Between businesses (and between a business and a public contracting authority), this reimbursement has been at least CZK 1,200 per receivable since 2014.

Our attorneys in Prague will advise you on how to properly assert all of these claims in court and what evidence to prepare.

How to secure a receivable so that collection is effective

The best court case is the one that never happens – that’s what we say. That is why it is important to put safeguards in place in advance so that collection ideally does not have to happen at all, or so that the process is as fast as possible.

Contractual tools that will help you

If the debtor takes you seriously and has something to lose, they are much more willing to pay. Various contractual security instruments for receivables help with this.

A contractual penalty, as we have already mentioned, gives the debtor an economic reason to pay.

Retention of title means that if you supply goods, you should agree that the goods remain yours until they are paid for. This is a very strong form of security because the debtor cannot resell the goods without the risk of a dispute.

Pledge: if possible, take collateral (for example, over the debtor’s equipment, vehicle, movable assets). If the debtor does not pay, you can satisfy your claim from the proceeds of the sale of the collateral.

An arbitration clause, especially between businesses, is a very effective tool. If you agree in a purchase or supply contract that any dispute will be resolved by an arbitrator (rather than a court), the dispute will generally be resolved faster and privately, without media attention. It cannot be agreed in contracts with consumers.

Arbitrators are often industry experts, so they understand the matter better than a general court judge.

A notarial deed with consent to enforceability: especially if the debtor takes something “on their word”, it is sensible to obtain a notarial deed. It may include express consent to direct enforceability, meaning you do not have to wait for court proceedings – it is sufficient to file a motion for enforcement based on the notarial deed.

The enforcement officer will then act on the basis of this deed.

Factoring and sale of a receivable

You can sell (assign) your receivable to a factoring company or another entity, which will then collect it itself.

Advantage: You get the money immediately (minus the factoring company’s fee) and do not have to deal with collection. Disadvantage: You lose part of the amount in fees. This option is particularly suitable for smaller companies that have dozens of unpaid invoices and do not want to deal with court proceedings.

For commercial receivables, assignment is governed by the general rules of the Czech Civil Code. You agree the price and terms with the factoring company by contract. The special rules effective from 1 January 2026 (consideration paid only by cashless transfer and the receivable passing only once it has been paid for) apply only to claims for maintenance determined by a court.

What matters is what you agree with the company: the price, whether you guarantee the collectability of the receivable (recourse), and when you receive the money. Our attorneys in Prague will help you assess whether factoring is suitable for your situation and, if applicable, will prepare the receivables assignment agreement.

Practical risks and mistakes to avoid

Debt collection is full of pitfalls. Let’s look at the most common mistakes businesses make:

Specifics of B2B debt recovery

When you recover a debt from another business (B2B), it is simpler in many respects, but at the same time greater professionalism is expected from you.

Advantages of B2B debt recovery

Businesses cannot rely on so-called consumer excuses – for example, that they did not know the terms and conditions or that the contract was disadvantageous. Courts treat them as "equal players" and expect that they clarified matters properly.

You can agree on arbitration instead of standard court proceedings. It is generally faster and more discreet.

Less protection for the weaker party means that if you have clear evidence, the court will accommodate you without major complications.

Disadvantages of B2B debt recovery

A higher standard of evidence is also expected from you. If you only have an email without details, it may not be considered sufficient evidence. You need an invoice, contract, order, handover protocol – something to support it.

Between businesses, the price for goods and services is by law payable within 30 days, typically from delivery of the invoice. However, you can agree on a longer payment term; more than 60 days only expressly and only if it is not particularly disadvantageous to the creditor. In that case, you wait longer for your money.

New options and changes

The following changes of recent years are important for creditors:

Central register of wage garnishments from 1 October 2026

As of 1 October 2026, the statutory rules on the central register of enforcement wage garnishments are in effect. It is kept by the Chamber of Enforcement Officers, and employers who register with it at their own request remotely enter data on the debtor’s wages and on deductions into it.

In practice, this means that when the enforcement officer issues an enforcement order for wage deductions, they will find the necessary data in the register and do not have to request it by letter from the registered employer. For 6 months from the entry, the employer is deemed to have thereby fulfilled its duty to provide information to the enforcement officer.

Preventive restructuring and shorter debt relief

If your debtor is a business in temporary difficulties, they have been able to use preventive restructuring since September 2023. The debtor negotiates with the affected creditors on a restructuring plan for getting out of the situation (for example, gradual repayment or adjustment of interest), and the court may confirm it. It is not insolvency proceedings.

For you, this means: If the debtor comes with a restructuring plan, you have a chance to agree what will be repaid to you. This is often better than waiting until they enter formal insolvency, where everything is defined by law and subordinated creditors receive only what is left.

The shortening of debt relief from five years to three years, effective from 1 October 2024, also means that if the debtor files for personal bankruptcy, they can get out of debt sooner – which motivates them to reach an agreement with creditors in time.

Sale of a receivable (assignment)

If you have an unpaid invoice, you can sell it to a factoring or collection company. It will then recover it itself. You will receive less than the nominal value of the receivable, but you have the money immediately.

For commercial receivables, you agree the price and terms of the assignment by contract. The special statutory conditions effective from 1 January 2026 (cashless consideration and the receivable passing only after payment) apply only to claims for maintenance determined by a court and do not affect the factoring of commercial invoices.

Attorneys from our Prague-based law firm will advise you on whether factoring is suitable for you and how to properly negotiate an assignment agreement.

Final summary

Debt recovery in 2026 rests on proven steps: a high-quality contract and security, a timely pre-action demand letter, an electronic payment order, and enforcement. From 1 October 2026, the new central register is intended to help with wage garnishments. However, success still depends mainly on deadlines, evidence, and correctly calculated ancillary claims.

If you do not want to make these mistakes and prefer a safe procedure that leads to recovering your money, contact the attorneys from our Prague-based law firm. They specialise in recovery between businesses and know all the ins and outs of the current Czech legal system.

Write to us at consultation@arws.cz – we will advise you on the best course of action in your company’s specific situation.

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