Legal term for payments in the Czech Republic

Yes, payment term legislation in the Czech Republic is essentially based on EU Directive 2011/7/EU on combating late payments in commercial transactions.

The standard payment term is 30 days.

Yes. The parties may agree to extend the payment term beyond the standard payment term. The extension may extend beyond 60 days only if it is not grossly unfair to the creditor. However, if an obligation between entrepreneurs consists of a duty to supply goods or provision of service to a public corporation, the parties may stipulate a later due date only if it is justified by the nature of the obligation. In this case, the payment term may not exceed 60 days.

A party may claim that the extension of the standard payment term is ineffective if the stipulations are grossly unfair to the creditor. The same ineffectiveness claim may be made by an entity created for the purpose of protecting SMEs if these terms are included within the GTCs.

Generally yes, but this may depend on the contractual setup. 

If there is no framework or other agreement, a PO would represent a contract once it is accepted by the other party. In such a case, an extended payment term could be part of a PO.

If there is an agreement, which foresees more than one PO, it is advisable to implement an extended payment term in the agreement so it applies to each PO. However, it should also be feasible to implement it in a PO, but there is a risk that the extended payment clause is omitted and the PO not accepted, etc. In such cases, it is preferable to determine a “general payment term” in the agreement, while adding “unless otherwise stated in a PO”. 

No. If a court declares a payment term to be ineffective, statutory provisions are used in its place, unless a court decides otherwise in the interest of a fair solution.

Yes. Parliament has passed a number of documents amending the payment term in certain obligations in light of the COVID-19 epidemic. 

The COVID-19 Loan Act

The Act No. 177/2020 Coll. on certain measures in the area of loan repayments related to COVID-19 pandemic introduces significant protection in the form of a standstill measure for borrowers by allowing them to defer payments of loan instalments and by limiting interest on loans for private individuals.

The Covid-19 Rent Acts

The Act No. 220/2020 Coll. on certain measures mitigating the impact of the SARS CoV-2 coronavirus epidemic on lease of commercial premises and the Act No. 209/2020 Coll. on certain measures mitigating the impact of the SARS CoV-2 coronavirus Epidemic on residential leases and other areas both introduce protection for tenants in financial difficulties resulting from the COVID-19 pandemic by allowing tenants to postpone the payment of rent due and by preventing landlords from terminating the lease due to non-payment of rent during the protection period.