Amendment of the Insolvency Act

On 19 January 2017 the Senate adopted the amendment of the Insolvency Act. A signature of the president is still necessary for the adoption of the amendment.

The aim of the amendment is inter alia the strengthening of the protection against the filling of so-called harassing insolvency petitions, the amendment implements therefore inter alia following changes:

-       the obligation to pay an advance on the costs of the insolvency proceedings (in case the insolvency petition was filled by the creditor);

-       preliminary assessment of the insolvency petition filled by the creditor – in case the insolvency court has doubts about the legitimacy of the insolvency petition, the court decides that neither insolvency petition nor other documents will be published in the insolvency register;

-       in case of a refusal of the insolvency petition for obvious unreasonableness a fine up to 500.000 CZK can be imposed to the petitioner (instead of current 50.000 CZK);

-       the petitioner, whose insolvency petition was legally refused, will be allowed to fill another insolvency petition against the same debtor at the earliest in six months.

Besides the above mentioned the amendment implements also changes regarding for example the debt relief, when the application for a permit of a debt relief and the insolvency petition will have to be written and filled only by a lawyer, notary, executor, insolvency administrator or by so called accredited person.