An enormous number of Czechs – almost 10 percent of those over the age of 15 – are in trouble with debt-collecting bailiffs. Indeed, more than 150,000 people in this country are facing a minimum of 10 distraint orders, according to the latest edition of a map of such cases released in mid-February, Radio Prague writes based on Open Society non-profit organization study.
The study by the non-profit Open Society found that in 2017 no fewer than 836,000 people in the Czech Republic were under some form of distraint, which is when one’s property is seized to obtain rent or other money owed.
The situation deteriorated further in 12 of the 14 regions in the Czech Republic last year, with 31,000 joining the ranks of those pursued by debt collectors. That represented a year-on-year increase of 3.4 percent on the figure for 2016.
One of the authors of the new edition of the map, Open Society’s Radek Hábl, said the numbers were growing despite the fact that the Czech Republic is experiencing record low unemployment and rising salaries.
Neither of these factors is helping people escape from the debt trap as debtors are continuously paying off high interest charges and various forms of penalties alone, said Mr. Hábl.
The worst hit regions are, perhaps predictably, the relatively poorly off former Sudeten areas of the country, such as Ústí nad Labem and Karlovy Vary, where a full 18 and 17 percent of the population, respectively, are pursued by debt collectors.
By contrast the Vysočina and Zlín regions are the least impacted, with “only” around 6 percent.
Update: Justice Minister Robert Pelikan said at a press conference at the beginning of March that in an amendment to the Bankruptcy Act his ministry would suggest that, in critical cases, debtors would not be obliged to pay back their debts to creditors. The amendment would "give these people a second chance" and a possibility "to restart their life". Creditors argue that the institute of personal bankruptcy has been misused already now, where debtors have to pay back at least 30 percent of the debt within 5 years. (Source: epravo.cz, Pravo daily)
28th August 2020
13th May 2020
25th August 2020
29th September 2020
29th September 2020