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September 27, 2022



Second round of Czech Republic's "summer of mercy" for debtors begins and will last until the end of November

8.9.2022 7:30
Collections proceedings in the Czech Republic. (Collage:
Collections proceedings in the Czech Republic. (Collage:

In the Czech Republic, the second round of what is being called the "summer of mercy" for debtors began on 1 September and will last until the end of November. Those who participate will be able to close the collections proceedings against them on behalf of public institutions more easily. 

If a debtor pays the original amount owed (the principal), plus a fee of CZK 1,815 [EUR 74] to the collections agent, then other fees, interest, and penalties will be waived and the enforcement of the proceedings will end. The action only applies to collections proceedings that began prior to 28 October 2021. 

Bankrupt individuals are not entitled to participate. Detailed information about the conditions and procedure can be found on the website (Czech only), which has been launched by the non-profit organization People in Need.

The first round of the "summer of mercy" took place from 28 October 2021 to 28 January 2022. Tens of thousands of borrowers have used it. 

During this second round it is possible to more easily resolve debts owed to municipalities; other public authorities; state funds; schools; municipal, state-owned or semi-state companies; health insurance companies, Czech Radio or Czech Television. The debtor must inform the collections agent in writing that s/he requests the initiation of the procedure under the rules of the grace period. 

Debtors can ask for a calculation of the principal remaining to pay. The collections agent must respond within 15 days. 

If the collections agent does not respond within 15 days, then the debtor's deadline for repayment will be extended by the same amount of time during which the agent's response was tardy. Compared to the previous "summer of mercy", agents' remuneration has risen from CZK 908 [EUR 37] to CZK 1,815 [EUR 74].

The Czech Justice Ministry and Czech Labor Ministry have already stated that it will also be explicitly determined which of the costs incurred by enforcing the collections the agent will be entitled to recover from this payment. Information about the program can be obtained by calling the organization People in Need at 770 600 800, Monday through Friday from 9:00 a.m. to 5:00 p.m. 

The email address is also available for contacting them. Other organizations also offer aid with this process, such as Caritas Czech Republic and its 70 counseling centers.

According to spokesperson Viktoria Plívová, the 190,000 clients who owe over CZK 11 billion [EUR 448 million] in insurance premiums could take advantage of the grace period at the General Health Insurance Company (VZP). Another CZK 14 billion [EUR 570 million] in penalties can be forgiven through this process as well. 

At, those interested in participating can find, among other things, a sample application form for sending to collections agents. According to debt experts, however, many borrowers will not have the money to repay any part of what is owed. 

People in Need has also established a fund to help such persons get out of debt. "The goal is not to help all debtors without reflecting on their cases - after all, one should pay off one's debts - but to help in cases where this is objectively not possible," said director Šimon Pánek. 

Single parents of minor children are an example of those whom the organization can aid. People in Need organized the fund already during the first round of the "summer of mercy". 

Back then, donors gave almost CZK 17 million [EUR 690,000]. Almost 300 families and individuals applied for aid.

Of those, 245 applicants met the stipulated conditions. Thanks to that support, thousands of collections proceedings ended.

Česká spořitelna and its bank specializing in construction savings are also joining the "summer of mercy". By calling 956 777 385, debtors can discover the amount of the principal they owe and the account to which to send payment.

Information is also available on the webpage (Czech only). The savings bank already participated in the first round of the "summer of mercy", forgiving more than CZK 90 million [EUR 3.7 million] in fees and interest to clients who paid the principal, according to spokesperson Filip Hrubý.

ČTK, translated by Gwendolyn Albert
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