Legal strategy protected client from having to return a large portion of subsidy
ARROWS represented a client in the audit phase and subsequent administrative proceedings concerning a penalty for breach of budgetary discipline. The audit authority found irregularities in the tender procedure and proposed a reduction in subsidies amounting to millions of Czech crowns. After a detailed analysis of the documentation, we chose a strategy based on proving the absence of a material impact of the error on the selection of the supplier and on the fulfillment of the purpose of the subsidy. This option was chosen because the legal qualification of the violation was disproportionately strict and did not correspond to the case law or methodologies of the provider. ARROWS prepared a comprehensive statement on the audit findings, developed legal arguments including references to relevant case law, and coordinated the supplementation of evidence.
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Following the objections filed and further procedural steps, we succeeded in achieving a reassessment of the amount of the correction and a significant reduction in the payment. At the same time, the firm set up the client's internal processes so that future projects would be implemented in full compliance with subsidy rules and procurement legislation. The result was the preservation of the majority of the subsidy granted, minimization of reputational risk, and a legally stable conclusion to the proceedings without the need to return a substantial portion of the support.
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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.