Enforcement proceedings (exekuce)
Compulsory enforcement of a final decision (exekuční titul) by a court bailiff (soudní exekutor) at the creditor's request, under Act No. 120/2001 Coll. It can target wages, accounts and property; the enforcement order is entered in the land registry, and the owner may not transfer or encumber the property. A home where the debtor has permanent residence cannot be auctioned for small debts below the statutory threshold (§ 336i(2) of the Civil Procedure Code).
Example
A debtor is repaying a CZK 4,000,000 mortgage at 5.00 % (about CZK 3,543,000 outstanding) and is not paying an unsecured CZK 150,000 loan. The creditor obtains enforcement and the flat is auctioned for CZK 5,000,000. The bank, as the lien creditor, is satisfied from the proceeds first; the lender of the loan gets money only from what remains after enforcement costs.
In practice
No bank will approve a mortgage while enforcement is ongoing, so check your status in the Central Register of Enforcements (Centrální evidence exekucí) before applying. If enforcement has ended, a bailiff's confirmation that the debt was recovered and deletion of the note from the land registry are usually enough. Small fines and fees are worth paying promptly: even a small debt, once inflated by enforcement costs, will block a purchase.
How it differs
Where enforcement recovers one specific debt for one creditor, insolvency deals with the debtor's bankruptcy towards all creditors at once, and once insolvency proceedings are opened, enforcement is suspended. Debt relief (oddlužení) is one way of resolving insolvency: after meeting the conditions, the debtor is freed from the remaining debts.
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