How can a Polish company litigate in the Czech Republic

When a Polish company faces a commercial dispute with a Czech partner, understanding the legal path forward is critical. This guide clarifies jurisdiction, court procedures, and EU regulations for businesses seeking an English-speaking lawyer in Prague. A leading Czech law firm in Prague, EU, like ARROWS, has the specialized knowledge to manage these complex cross-border commercial disputes.

Need advice on this topic? Contact the ARROWS law firm by email office@arws.cz or phone +420 245 007 740. Your question will be answered by "Mgr. Vojtěch Sucharda", an expert on the subject.

The Legal Framework: Understanding the EU and Czech Rules of Engagement

Litigation between companies based in Poland and the Czech Republic operates under a dual-layered legal system. The foundation is a set of harmonized European Union regulations that govern cross-border judicial cooperation, ensuring predictability and efficiency. Layered on top of this are the specific national laws of the Czech Republic, which dictate the procedural intricacies of any lawsuit filed within its courts.

The cornerstone of the EU framework for civil and commercial disputes is Regulation (EU) No 1215/2012, commonly known as the "Brussels Ibis Regulation". This regulation establishes uniform rules for determining which Member State's courts have jurisdiction and simplifies the recognition and enforcement of judgments across the EU. Its primary purpose is to facilitate the free circulation of judgments, a key component of the EU's single market, and to enhance access to justice for businesses operating across borders.

This unified EU approach provides a significant strategic advantage. It creates a cohesive "EU Justice Toolkit" that makes litigation within the Union fundamentally more secure and predictable than engaging in disputes with partners in non-EU countries. For a Polish company, the existence of these regulations reduces the uncertainty and complexity often associated with international legal action.

While EU law governs the "where" and "how" of cross-border elements, the actual court proceedings follow the national procedural code of the forum country. In this context, litigation in the Czech Republic is governed by Act No. 99/1963 Coll., the Code of Civil Procedure. 

This code outlines the specific steps for filing a claim, presenting evidence, and the conduct of hearings. It is important to note that Poland has its own distinct Code of Civil Procedure, and procedural assumptions valid in Polish courts may not apply in the Czech system. Navigating this dual system requires a law firm with deep expertise in both EU regulations and Czech national law.

Jurisdiction: Where to File a Claim

The first and most critical question in any cross-border dispute is determining which country's courts have the authority to hear the case. The Brussels Ibis Regulation provides clear and predictable rules to answer this question.

The General Rule: Suing in the Defendant's Home Court

The fundamental principle of jurisdiction within the EU is actor sequitur forum rei, which means the plaintiff follows the court of the defendant. According to Article 4(1) of the Regulation, persons and companies domiciled in a Member State must be sued in the courts of that Member State, regardless of their nationality.

For a Polish company, this means that if it needs to sue a Czech company for breach of contract or any other commercial dispute, the default venue for the lawsuit is a Czech court, where the defendant is domiciled. This rule is designed to protect the defendant, as it is generally considered easier to defend a case on one's home territory.

Crucial Exceptions for Commercial Disputes

The Brussels Ibis Regulation provides for several important exceptions, known as "special jurisdiction," which offer strategic alternatives to the general rule. These are particularly relevant for commercial disputes.

In matters relating to a contract, a company can be sued in the courts for the "place of performance of the obligation in question". For a contract for the sale of goods, this is the place where the goods were or should have been delivered. For a contract for the provision of services, it is the place where the services were or should have been provided. This allows a Polish company to potentially sue its Czech partner in Poland if, for example, the contractual obligation was to be performed there.

In matters relating to tort, delict, or quasi-delict (which includes claims for damages, unfair competition, or intellectual property infringement), a company can be sued in the courts of the place where the "harmful event occurred or may occur". This provides a crucial option for cases where the damage was suffered in a different country from where the defendant is based.

The Power of Choice-of-Court Agreements

One of the most powerful tools for managing cross-border risk is a choice-of-court agreement, also known as a jurisdiction clause, included in a commercial contract. The Brussels Ibis Regulation gives strong legal effect to these agreements. If parties have agreed that the courts of a particular Member State will have exclusive jurisdiction to settle any disputes, those courts will have precedence over all others, regardless of where a lawsuit is first filed.

This means a well-drafted contract can provide absolute certainty about where litigation will take place. If a contract between a Polish and a Czech company specifies Polish courts as the exclusive forum, Czech courts must decline to hear the case in favor of the Polish court. This underscores the importance of proactive legal advice during the contract negotiation phase to secure a favorable jurisdiction.

Contact our experts:

FAQ – Legal tips on choosing the right court

• What is the effect of a contract specifying a Polish court for disputes?
  If a contract contains a valid choice-of-court agreement granting exclusive jurisdiction to Polish courts, the Brussels Ibis Regulation mandates that other EU courts, including those in the Czech Republic, must respect this choice and decline to hear the case. Unsure about a contract's jurisdiction clause? A law firm can provide a clear analysis. Contact ARROWS at office@arws.cz.
• Can a Czech company be sued in Poland for a breach that occurred in the Czech Republic?
  Generally, no. Under the special jurisdiction rules, if the contractual obligation (e.g., delivery of goods) was to be performed in the Czech Republic, the Czech courts would have jurisdiction. However, if the contract stipulated performance in Poland, then Polish courts could hear the case. For tailored legal solutions, write to office@arws.cz.

The Czech Litigation Process: A Step-by-Step Guide for Polish Businesses

Once jurisdiction is established in the Czech Republic, the lawsuit proceeds according to the Czech Code of Civil Procedure. For a Polish company, understanding these local rules is essential for success.

Initiating the Lawsuit

A lawsuit is initiated by filing a statement of claim (žaloba) with the competent court. This document must clearly state the parties, the facts of the case, the evidence being relied upon, and precisely what the plaintiff is demanding from the defendant.

A court fee must be paid upon filing. For monetary claims, the fee is generally 5% of the amount in dispute. Failure to pay the fee will result in the court discontinuing the proceedings. A critical requirement for foreign litigants is that all documents and evidence submitted in a language other than Czech must be accompanied by a certified translation into Czech, performed by a court-appointed translator.

Court Structure in Commercial Matters

In the Czech Republic, civil and commercial cases are heard at first instance by either District Courts (okresní soudy) or Regional Courts (krajské soudy). While District Courts handle most general civil matters, Regional Courts have first-instance jurisdiction over more complex commercial cases, including those related to unfair competition, intellectual property, and disputes concerning commercial companies. Appeals from District Courts are heard by Regional Courts, and appeals from Regional Courts are heard by one of two High Courts.

The Role of the Judge and Evidence

The Czech legal system is rooted in the continental European civil law tradition, which emphasizes codified statutes over case law. Unlike in common law systems, previous court decisions are not strictly binding precedents. Judges prioritize the interpretation of statutory law.

Parties to the proceedings have the "burden of proof," meaning they must present evidence to support their claims. However, the judge in a Czech court often plays a more active, inquisitorial role than in some other jurisdictions. The court can, in certain cases, take evidence on its own initiative if it is necessary to establish the facts.

This procedural culture can differ significantly from that in other jurisdictions. For instance, commercial proceedings in Poland have been characterized as more formalistic and restrictive, with stringent rules on the admissibility of evidence. 

A litigation strategy that relies heavily on precedent or follows a rigid, adversarial approach to evidence might be less effective in a Czech court. Success often depends on presenting a case that aligns with the judge's interpretation of the relevant statutes, a nuance that requires local expertise. Adapting the presentation of a case to the local legal culture is not a mere technicality but a strategic necessity.

Timelines for Resolution

The duration of a court case in the Czech Republic depends heavily on its complexity. According to official statistics, the average time to obtain a final decision in a civil proceeding is approximately one year and one month. However, more complex commercial disputes decided by Regional Courts can take an average of 4.5 years to resolve if an appeal is filed. Procedural deadlines are strict and are categorized as either statutory (laid down by law) or judicial (set by the court).

Risks and penalties	How ARROWS helps
Filing in the wrong court due to misinterpretation of EU jurisdiction rules, leading to dismissal and wasted costs.	Pre-litigation legal analysis to determine the optimal jurisdiction. Need help? Email us at office@arws.cz.
Submitting a statement of claim with procedural errors or improperly translated evidence, causing fatal delays or rejection.	Drafting legally compliant documentation and managing certified translations to meet all court requirements. Get started by writing to office@arws.cz.
Missing a statutory deadline (statute of limitations), resulting in the complete loss of the right to claim.	Legal consultation to ensure all deadlines are met and rights are preserved. For immediate assistance, write to us at office@arws.cz.
Presenting evidence in a manner that is unpersuasive within the Czech legal culture, weakening an otherwise strong case.	Representation in court by experienced Czech litigators who know how to build a compelling case for a Czech judge. Our lawyers are ready to assist you – email us at office@arws.cz.

Leveraging the EU Toolkit for Cross-Border Efficiency

Beyond establishing jurisdiction, EU law provides a set of practical tools that streamline the technical and administrative aspects of a lawsuit between parties in different Member States. These regulations replace slow, traditional diplomatic channels with efficient, standardized procedures.

Serving Documents Across Borders

Properly notifying the defendant of a lawsuit is a fundamental legal requirement. Regulation (EU) 2020/1784 (the Service Regulation) creates a simplified and rapid system for serving judicial documents between Member States.

The regulation establishes a network of "transmitting agencies" (in the country where the lawsuit is filed) and "receiving agencies" (in the country where the document needs to be served). To serve a claim on a Czech defendant, a Polish court's transmitting agency sends the documents directly to the designated receiving agency in the Czech Republic using a standard form. 

This direct communication bypasses cumbersome diplomatic channels and ensures that service is carried out according to legally recognized procedures, preventing the entire case from being invalidated on a technicality.

Gathering Evidence from Another EU Country

Often, key evidence, such as witness testimony or expert reports, may be located in a different Member State. Regulation (EU) 2020/1783 (the Taking of Evidence Regulation) facilitates judicial cooperation in gathering such evidence.

Under this regulation, a Czech court hearing a case can directly request a Polish court to perform an evidentiary act. For example, the Czech court can ask the Polish court to hear a witness who resides in Poland or to conduct a site inspection there. 

The Polish court then executes the request according to its own national law and transmits the results back to the Czech court. This mechanism is vital for building a comprehensive case without the prohibitive cost and complexity of traditional cross-border evidence gathering.

An international law firm operating from Prague, European Union, such as ARROWS, can leverage its deep experience with these EU regulations. The firm's ARROWS International network, built over 10 years and spanning 90 countries, provides seamless support for complex cross-border evidence gathering and procedural matters, ensuring that all technical requirements are met efficiently.

Risks and penalties	How ARROWS helps
Improper service of the initial claim, leading to the entire proceeding being declared invalid.	Full management of the cross-border service of documents to ensure full compliance with EU regulations. Need legal help? Contact us at office@arws.cz.
Key witness testimony from Poland being deemed inadmissible due to incorrect procedure for taking evidence abroad.	Coordinating with our international network to correctly obtain evidence under the EU Taking of Evidence Regulation. Get tailored legal solutions by writing to office@arws.cz.
Delays caused by using incorrect forms or failing to meet translation requirements for procedural documents.	Preparation of all legally required documentation for cross-border proceedings. Do not hesitate to contact our firm – office@arws.cz.

Enforcing Your Judgment: From a Polish Victory to Czech Assets

Winning a lawsuit is only half the battle; the ultimate goal is to enforce the judgment and recover what is owed. The EU legal framework offers a powerful advantage in this final, crucial stage.

The Brussels Ibis Regulation fundamentally simplified this process by abolishing the exequatur. This was the intermediate procedure previously required to have a judgment from one Member State declared enforceable in another. The abolition of this step saves significant time and money, with the European Commission estimating that the old procedure cost between EUR 2,000 and EUR 3,000 on average and was a mere formality in 95% of cases.

Under the current system, a judgment on a civil or commercial matter rendered in any EU Member State is automatically recognized and directly enforceable in any other Member State. This principle of mutual recognition means a judgment from a Polish court is treated as if it were a domestic judgment by Czech authorities.

The practical steps for enforcement are straightforward:

1. The Polish company that won the case must obtain a copy of the judgment from the Polish court.
2. The company must also request that the Polish court issue a standard Annex I certificate, which confirms that the judgment is enforceable.
3. These two documents, along with a certified translation into Czech, are then provided to the competent enforcement authority in the Czech Republic (typically a court bailiff or soudní exekutor).

This streamlined system of "free movement of judgments" is a pillar of the EU single market. It fundamentally alters the risk calculation for potential debtors. A Czech company, knowing that a Polish judgment can be enforced in the Czech Republic quickly and with minimal cost, has a powerful incentive to fulfill its contractual obligations. 

This legal mechanism not only facilitates post-litigation enforcement but also strengthens a Polish company's position in pre-litigation negotiations, as the threat of efficient enforcement serves as a potent deterrent against non-compliance.

How ARROWS Protects Business Interests in the Czech Republic

Navigating a commercial dispute in a foreign jurisdiction presents numerous challenges, from understanding complex jurisdictional rules to adapting to a different procedural culture and managing cross-border administrative tasks. Attempting to manage this process without expert local guidance exposes a business to significant financial and operational risks.

ARROWS provides the specialized legal support necessary to protect the interests of Polish companies in the Czech Republic. Whether a client requires proactive contract drafting to secure favorable jurisdiction, vigorous representation in court to argue a case, or efficient assistance with the enforcement of a judgment, the firm's team of experienced litigators is prepared to act. 

The firm also offers professional training for management on mitigating cross-border legal risks and helps draft internal company policies and other legally required documentation to prevent disputes before they arise.

ARROWS supports over 150 joint-stock companies and 250 limited liability companies, demonstrating a deep well of experience in Czech corporate and commercial law. The firm's expertise, built over 10 years through the ARROWS International network in 90 countries, ensures it can deliver legal solutions with the speed and high quality that international clients demand.

Polish companies should not navigate the complexities of Czech commercial litigation alone. As a leading Czech law firm in Prague, EU, ARROWS provides the local expertise and international perspective a business needs to succeed. For a confidential consultation on a specific situation, contact the team today at office@arws.cz.

FAQ – Most Common Legal Questions About Polish-Czech Litigation

• What is the statute of limitations for commercial claims in the Czech Republic?
  The Czech Civil Code establishes a combined limitation period. The general subjective period, which starts when the creditor learns of the claim, is three years. This runs within a broader objective period of ten years from the date the right could first be exercised (e.g., when a debt became due). It is crucial to act promptly. Worried about a deadline? Get a quick assessment of a claim by writing to office@arws.cz.

• Is a Czech lawyer absolutely necessary to litigate in a Czech court?
  While not always mandatory for a company to be represented, it is strategically essential. Proceedings are conducted in Czech, and all submissions must be in Czech. Furthermore, a local lawyer understands the procedural nuances and the judicial culture, which is vital for effectively presenting a case. Ensure the best local representation by contacting the team of English-speaking Czech lawyers at office@arws.cz.

• What are the typical costs associated with commercial litigation in Prague?
  Costs primarily consist of court fees and legal fees. The court fee for a monetary claim is typically 5% of the value of the dispute. Legal fees vary based on the complexity of the case. Critically, under the Czech system, the unsuccessful party is generally ordered to reimburse the successful party for its reasonable legal costs. For a transparent estimate of potential litigation costs, reach out to ARROWS at office@arws.cz.

• How long does a standard commercial dispute take to resolve in the Czech Republic?
  The timeline varies significantly with complexity. A routine case may be resolved in about a year. However, more complex commercial disputes heard by Regional Courts can take an average of 4.5 years to reach a final decision, including appeals. Need a faster resolution? ARROWS can also advise on arbitration and mediation. Discuss the options at office@arws.cz.

• Can a dispute be resolved through arbitration instead of litigation?
  Yes, arbitration is a common and encouraged alternative to court litigation in the Czech Republic. It is often faster, more flexible, and confidential. However, it is only possible if both parties have agreed to it, typically through an arbitration clause in their contract. Considering arbitration? Let ARROWS review the contract and advise on the best path forward. Email the firm at office@arws.cz.

• A dispute involves a case of unfair competition. Are there special rules?
  Yes. Cases concerning unfair competition, along with other complex commercial matters like intellectual property, are typically handled by the more specialized Regional Courts at the first instance, rather than District Courts. This highlights the need for legal counsel with specific expertise in these areas. ARROWS has extensive experience in complex commercial disputes. Protect a business by contacting specialists at office@arws.cz.