Lawsuit over a transfer of shares in the Czech Republic? Pay attention to correct jurisdiction

Has your business partner refused to pay the purchase price for shares in a Ltd. or joint stock  company in spite of the fact you have reminded them? If all your efforts to settle the situation extra judicially are in vain, you may have to bring your case to the court and demand the due payment should be made.

In this case, do you know which court you should turn to?

The Supreme Court of the Czech Republic has recently ruled[i] that even after the amendment to the Civil Procedure Rules introducing changes to the functional jurisdiction of district and regional courts have come into effect all lawsuits concerning contracts on shares transfers need to be decided by regional courts (or the Municipal Court in Prague).

If a buyer, then, refuses to pay the purchase price in whole or in part, or performs the payment after the due date and you happen to gain a right to claim a conventional fine or file a proposal for a change of the ownership of the transferred shares or a proposal for an invalidity of the transfer on the due to a spouse not having agreed to the transfer, or you claim back the paid transfer price for on the grounds of nullity of the contract etc., you should bear in mind that the suit needs to be brought to a regional, not a district, court.

 

[i] See Ruling of the Supreme Court of the Czech Republic regarding case number 29 Cdo 4825/2015 of 15 June 2017