How Swedish Companies Can Pursue Legal Action in the Czech Republic: Essential Guidance

Swedish companies entering the Czech market often face unexpected legal obstacles when disputes arise with local partners. While both Sweden and the Czech Republic operate within the EU framework, their legal systems differ significantly in procedure, evidence requirements, and enforcement mechanisms. This guide explains the critical steps Swedish businesses must take to pursue successful legal action in Czech courts.

Understanding the Czech legal landscape

Swedish companies accustomed to their home legal system frequently assume that civil litigation in the Czech Republic will follow similar principles. This assumption creates substantial risks.

The Czech civil procedure operates on fundamentally different foundations than Swedish law, with stricter deadlines, mandatory formal requirements, and no discovery process to help you build your case after filing.

The written Czech procedure places enormous emphasis on evidence and documentation prepared before you even enter the courtroom. The Brussels I Recast Regulation does provide important advantages for EU businesses litigating across member states, but it does not eliminate procedural differences that can derail an unprepared claimant.

ARROWS Law Firm, based in Prague and specializing in cross-border disputes, works regularly with Swedish businesses on Czech litigation matters to structure cases from the outset in ways that maximize success.

Determining whether Czech courts have jurisdiction over your dispute

Your first strategic decision is establishing whether a Czech court can and should hear your case. This is not a trivial preliminary step. Choosing the wrong forum can waste months and create enforcement complications that render even a successful judgment worthless.

For commercial disputes involving Swedish companies and Czech defendants, the default rule is that the courts of the member state where the defendant is domiciled have jurisdiction.

However, your commercial contract may include a jurisdictional choice clause designating a different forum. Swedish companies sometimes overlook these provisions during contract negotiation, only to discover later that they have agreed to resolve disputes in a specific Czech court.

Both you and your Czech partner are generally bound by such clauses. Attempting to ignore a jurisdictional choice of law agreement creates serious practical problems. Czech courts will not automatically recognize a Swedish judgment, and enforcing it becomes far more complicated.

Conversely, if you follow your contract's forum selection and file in a Czech court as permitted, your resulting judgment becomes enforceable throughout the European Union through streamlined procedures. This enforcement advantage makes the Czech Republic a strategically favorable jurisdiction for resolving disputes with Czech-based partners.

The Czech Republic operates over 80 district courts ( okresní soudy ) and 8 regional courts ( krajské soudy ). Most commercial disputes begin in these courts based on territorial jurisdiction rules linked to where the defendant resides or where the company is registered.

The lawyers at ARROWS Law Firm can review your existing contracts, analyze the optimal Czech court for your dispute, and explain the enforcement implications of choosing between Czech and Swedish venues.

Related queries on choosing the right Czech court

1. If my contract names a Czech court, must I file there?
Yes, generally both parties are bound by jurisdictional choice clauses. Filing in the wrong Czech court or ignoring the clause creates procedural complications and delays.

2. Can a Swedish company sue a Czech company in Swedish courts?
Technically yes, if there is a legal basis for jurisdiction in Sweden, but if the contract designates Czech courts, the Swedish court may decline jurisdiction. Furthermore, any judgment you obtain will be far more difficult to enforce in the Czech Republic if the jurisdictional rules were not followed.

3. Does the EU make it easier to enforce judgments from Swedish courts in the Czech Republic?
The Brussels I Recast Regulation streamlines recognition of EU judgments, but a Czech court judgment remains simpler and faster to enforce domestically, eliminating the need for the certificate of enforceability from a foreign court.

The mandatory pre-litigation demand letter

Before filing any lawsuit in the Czech Republic, professional practice and statutory rules require that you send a formal pre-litigation demand letter. This is known in Czech as the předžalobní výzva .

If you win your lawsuit on the merits but never sent the demand letter, the court will generally refuse to award you reimbursement of your legal costs and court fees.

The předžalobní výzva is not a casual reminder or informal business correspondence. It must be a formal, legally compliant document that clearly identifies your claim, specifies the exact amount owed, and sets a concrete deadline for payment.

Swedish business executives sometimes assume that a standard demand letter they use in Sweden, translated into Czech, will satisfy this requirement. This assumption creates significant risk. Czech demand letters must comply with specific formal requirements.

You must send the demand letter at least seven days before filing your lawsuit. This waiting period is mandatory for cost recovery purposes and demonstrates to the court that you acted in good faith.

The lawyers at ARROWS Law Firm draft demand letters that comply with all formal requirements, reference supporting evidence, and maximize your position should the dispute proceed to court.

Related queries on the pre-litigation demand letter

1. What happens if I skip the demand letter and file directly in court?
You risk losing the right to recover your legal and court costs even if you win the case. This can transform a legal victory into a financial loss.

2. Can an email satisfy the demand letter requirement?
Generally no, unless you can prove delivery and content indisputably. The safest method is sending via registered mail or the Czech data box system with proof of delivery.

3. How long should I wait after sending the demand letter before filing?
At least seven days is required by law. This waiting period demonstrates good faith and protects your right to cost recovery.

Filing your statement of claim

The next critical phase is filing your žaloba (statement of claim) with the appropriate Czech court. This is perhaps the most misunderstood aspect of Czech litigation for foreign companies.

Czech procedure requires you to gather and present all your evidence generally before or upon filing your initial claim.

This fundamental difference explains why Czech litigation is so dependent on pre-filing preparation. Czech courts view the filing as a submission that should already contain your complete evidentiary foundation.

If you file with incomplete evidence, you cannot rely on later obtaining information from the opposing party through discovery. Czech civil procedure has no broad discovery mechanism comparable to US or Swedish practice.

The statement of claim must contain specific mandatory elements established in the Code of Civil Procedure. The court will reject or require correction of your claim if it fails to meet these formal requirements.

The lawyers at ARROWS Law Firm draft the full claim package for international clients, including contract analysis, evidence structure, damages theory, and litigation risk mapping.

Czech law permits filing both electronically and in paper form. For Swedish companies managing disputes remotely from Sweden, electronic filing offers significant advantages.

Common filing mistakes

Foreign claimants consistently make the same procedural errors when filing in Czech courts. The most damaging mistakes include identifying the wrong defendant or filing in the wrong territorial jurisdiction based on misunderstanding where the defendant's registered office is located.

The lawyers at ARROWS Law Firm verify defendant identification, confirm territorial jurisdiction, organize evidence properly, and calculate court fees accurately before filing.

The preliminary hearing and evidence presentation

After you file your claim and the court confirms it meets formal requirements, the court will serve it on the defendant. The defendant then typically has 30 days to file a defense ( vyjádření k žalobě ) if ordered by the court.

If the defendant fails to respond without justification to this qualified order, the court may issue a default judgment ( rozsudek pro uznání ) in your favor.

More commonly, the defendant files a defense, and the court then schedules a preliminary hearing ( přípravné jednání ). This hearing is fundamentally different from trial preparation in other systems.

The preliminary hearing often reveals whether the case has serious settlement potential. Many Czech judges actively encourage settlement at this stage, and credible settlement discussions can significantly reduce your costs.

Evidence presentation in Czech courts operates very differently from Swedish or common-law proceedings. Czech judges, not juries, control witness examination. The presiding judge questions witnesses in a specific order.

ARROWS Law Firm's approach to Czech litigation emphasizes early preparation, complete documentation, and strategic evidence organization designed to work within the Czech framework.

Costs, fees, and the loser-pays principle

Before committing to Czech litigation, Swedish companies must understand the cost structure and who ultimately bears the expense. Czech courts operate under the "loser pays" principle.

In Czech litigation, the losing party is generally ordered to reimburse the winning party's court fees and legal costs, subject to limitations set by the Regulation on Advocates' Tariff.

Court fees are assessed as a percentage of the claim amount. For claims up to CZK 40 million, the court fee is five percent of the amount claimed. If the claim exceeds CZK 40 million, the fee increases.

Legal cost reimbursement is limited to statutory amounts set by the lawyer's tariff, not your actual legal spend. This means that even if you win and recover costs, the amount awarded may be less than what you actually paid your lawyer.

A critical financial protection involves the pre-litigation demand letter. If you fail to send the required předžalobní výzva , the court will likely deny your request for cost recovery even if you win on the merits.

The lawyers at ARROWS Law Firm handle all procedural steps designed to maximize your cost recovery.

Risks and sanctions	How ARROWS (office@arws.cz) helps
Court fee miscalculation: Filing with an incorrectly calculated fee or non-payment can result in dismissal or discontinuance of your entire proceeding, requiring you to refile and restart.	Precise court fee calculation: ARROWS ensures accurate fee calculation based on your specific claim amount, timely payment, and proper documentation of fee payment to protect your case from administrative dismissal.
Cost forfeit despite winning: Failure to send the mandatory pre-litigation demand letter results in courts denying cost recovery even when you win, leaving you bearing your own legal expenses despite victory on the merits.	Pre-litigation strategy: ARROWS drafts and sends compliant demand letters meeting all Czech procedural requirements, preserving your right to full cost recovery if you prevail.
Adverse cost awards: Improper case preparation, procedural errors, or frivolous claims can result in the opposing party obtaining cost reimbursement from you even if you have a legitimate underlying dispute.	Risk assessment and preparation: ARROWS evaluates your case early, eliminates procedural vulnerabilities, and structures your claim to withstand opponent challenges and avoid adverse cost awards.
Ongoing fee obligation: Czech litigation fees often exceed initial estimates due to procedural complexity, multiple hearings, or evidence disputes, creating budget overruns that accumulate throughout the case.	Fixed-fee and phased engagement options: ARROWS offers structured fee arrangements that provide cost certainty and allow you to make go/no-go decisions at key procedural stages.

Appeals and extraordinary appeals

If the first-instance court rules against you, you have the right to appeal. An appeal ( odvolání ) must be filed within 15 days of delivery of the written decision at the court whose decision is being challenged.

Procedural time-limit rules in Czech litigation are strict and courts rarely grant extensions based on excusable neglect.

The appellate court reviews the first-instance judgment. Importantly, Czech procedure limits the introduction of new facts and evidence on appeal. The appellate court generally disregards new facts or evidence when hearing an appeal.

If you lose your appeal, you may pursue an extraordinary appeal to the Supreme Court ( dovolání ). This remedy is limited in scope and admissibility.

Representation by an attorney is mandatory for extraordinary appeals. This requirement adds another layer of cost and complexity to appellate proceedings.

ARROWS Law Firm regularly handles appeals and extraordinary appeals for Swedish clients, providing specialized expertise in appellate strategy and Supreme Court procedure.

Related queries on appeals and post-judgment procedure

1. Can I introduce new evidence on appeal if I forgot to submit it at first instance?
Generally no. Czech procedure strictly limits new evidence on appeal, with exceptions only for specific categories such as evidence bearing on court jurisdiction or procedural defects affecting the first-instance judgment.

2. How long do I have to appeal a first-instance decision?
You must file an appeal within 15 days of delivery of the written decision. This deadline is strict.

3. What happens if I lose my appeal?
You may pursue an extraordinary appeal to the Supreme Court, but only on limited grounds relating to legal principles and their application, not on facts or evidence.

Who can you contact?

Enforcement of the judgment

A favorable Czech judgment is only as valuable as your ability to enforce it. Enforcement is a separate procedural phase that begins after your judgment becomes final and binding.

For most commercial disputes, enforcement through a private bailiff ( soudní exekutor ) is far more effective and efficient than enforcement through the court system.

To initiate enforcement, you must file an execution application ( exekuční návrh ). You will submit your judgment, pay a filing fee, and the court will authorize the bailiff to proceed.

The bailiff can seize virtually any asset belonging to the debtor except items protected as essential. Bank accounts can be frozen, wages and pensions can be garnished, and movable property can be seized and auctioned.

An important cross-border advantage involves the Brussels I Recast Regulation. If your Czech judgment was issued in proceedings instituted after January 10, 2015, it is automatically recognized and enforceable throughout the European Union.

ARROWS Law Firm's enforcement expertise extends to selecting the optimal bailiff for your case, structuring the execution application to maximize leverage, and monitoring the bailiff's enforcement activities.

Arbitration as an alternative

Many Swedish companies negotiating contracts with Czech partners include arbitration clauses rather than submitting to Czech court jurisdiction. Arbitration offers distinct advantages in cross-border disputes: neutrality, confidentiality, and a single round of proceedings.

Czech arbitration rules provide procedural flexibility and typically allow parties to conduct proceedings in English, a significant advantage over Czech court proceedings conducted exclusively in Czech.

Arbitration proceedings are not subject to the strict procedural requirements of Czech courts in the same way. However, arbitration has costs and drawbacks. Arbitration fees are substantially higher than court fees in many cases.

ARROWS Law Firm can advise you on arbitration strategy and represent you in arbitration proceedings if you have included arbitration clauses in your contracts.

Service of documents complications

If your dispute involves a defendant outside the EU, additional complexity and international legal requirements apply regarding service of process. However, for service of documents between the Czech Republic and Sweden, the EU Service Regulation is the controlling legal framework.

Serving a Swedish defendant with Czech judicial documents requires strict compliance with this Regulation. You cannot simply email documents or use informal service methods if the recipient refuses to accept them.

Similarly, if you are a Swedish company and a Czech partner obtains a judgment against you in Czech courts, enforcement of that judgment in Sweden involves recognition principles under the Brussels I Recast Regulation.

The firm's lawyers combine in-depth knowledge of Czech legal procedures with familiarity with EU Service Regulation requirements to ensure your international disputes proceed without service defects.

Time required for Czech litigation

Swedish companies consistently underestimate the time required to resolve disputes through Czech courts. First-instance civil litigation typically takes 12 to 24 months depending on case complexity.

Appeals can add another year or more. If an extraordinary appeal to the Supreme Court is necessary, add another year or two. Total resolution through all appellate levels can span four to six years or longer for complex cases.

This timeline reflects the realities of Czech court caseload, procedural requirements, and the judicial system's deliberate pace. Courts operate on scheduled hearing dates, and postponements for good cause are common.

ARROWS Law Firm's experience with Czech litigation allows realistic timeline projections and helps clients understand that patience and systematic procedural compliance are essential to success.

Conclusion

Swedish companies pursuing legal action in the Czech Republic must recognize that success requires more than a strong underlying legal claim. The Czech civil litigation system imposes procedural requirements, formal documentation standards, and evidence presentation protocols that differ substantially from Swedish legal practice.

The pathway to successful litigation begins months before you file. It involves strategic assessment of jurisdiction and forum selection, thorough investigation and evidence gathering, and expert drafting of the mandatory pre-litigation demand letter.

The lawyers at ARROWS Law Firm combine in-depth knowledge of Czech legal procedures with experience representing Swedish and other international clients navigating the complexities of Czech litigation.

ARROWS Law Firm regularly partners with corporate legal departments to manage specialized cross-border disputes. This allows your internal team to focus on core business while litigation specialists manage your Czech proceedings.

The services ARROWS Law Firm provides include jurisdiction and forum selection strategy, pre-litigation demand letter preparation, and statement of claim drafting. The firm also provides expert legal opinions addressing Czech law issues.

Do not navigate Czech litigation without specialized expertise. The stakes are too high, the procedural complexity too substantial, and the cost of procedural errors too severe. Write to office@arws.cz today to discuss your dispute and explore how the lawyers at ARROWS Law Firm can protect your interests in Czech proceedings.

FAQ – Frequently asked legal questions about pursuing legal action in the Czech Republic

1. How do I know whether my contract disputes should be resolved in Czech courts or Swedish courts?
Your contract's jurisdictional choice clause generally determines where disputes must be litigated. If the contract designates Czech courts, you are typically bound to that forum. Czech courts offer strategic advantages for EU-wide enforcement under Brussels I Recast, but they impose strict procedural requirements.

2. What is the most common mistake Swedish companies make when filing in Czech courts?
The most common error is failing to send the mandatory pre-litigation demand letter before filing, which results in forfeiture of cost recovery even if you win. Other frequent mistakes include incomplete evidence presentation at first instance, failure to calculate court fees correctly, and filing in the wrong territorial jurisdiction.

3. How long does litigation in Czech courts typically take?
First-instance litigation usually takes 12 to 24 months depending on case complexity. Appeals add another year or more. If extraordinary appeal to the Supreme Court is necessary, add another year. Total resolution through all levels can span four to six years or longer.

4. What happens if the opposing party does not pay the judgment even after I win?
Your judgment must be enforced through a separate proceeding, typically with a private bailiff authorized by the court. The bailiff can seize assets, freeze bank accounts, garnish wages, and auction property to satisfy the judgment. If the debtor lacks accessible assets, enforcement may not result in full recovery.

5. Can I introduce new evidence at trial if I forgot to submit it with my initial claim?
Generally no. Czech procedure strictly limits new evidence on appeal and restricts new evidence at trial beyond what you submitted with your claim. This requirement makes complete evidence preparation before filing absolutely critical.

6. What is the difference between court litigation and arbitration in the Czech Republic?
Arbitration offers neutrality, confidentiality, and enforcement under the New York Convention globally. However, arbitration fees are often higher than court fees, awards are final with extremely limited appeal, and arbitrators are not bound by Czech civil procedure unless specified.

Disclaimer: The information contained in this article is for general informational purposes only and serves as a basic guide to the issue. Although we strive for maximum accuracy in the content, legal regulations and their interpretation evolve over time. To verify the current wording of the regulations and their application to your specific situation, it is therefore necessary to contact ARROWS Law Firm directly (office@arws.cz).