President signs major new amendment on distraint law

President Milos Zeman signed an amendment to the distraint law on Tuesday, which some experts believe contains the most significant changes to the handling of distraint made over the past two decades. The law is expected to come into force in 2023.

The amendment will introduce a six-year deadline after which bankruptcy administrators would be forced to end distraints, if they prove ineffective. However, it will be possible to extend the deadline for up to 12 years. Seizure of movable property will be partially reduced and the rules on how debt is repaid will partially change as well.

The Chamber of Bankruptcy Administrators (Exekutorská komora) has announced it will seek to appeal the amendment at the Constitutional Court if the legislation prevents administrators from being reimbursed for ineffective distraints.

Author: Tom McEnchroe