01.01.2018
As generally known, everyone should take care of his/her property for a case of death, especially if someone has an asset in more than one country or if he/she lives in a different country than of his/her citizenship. For families who have their property in several countries the last will is an essential tool to protect their assets.
Generally, Czech courts have jurisdiction over inheritance proceedings if the deceased person was a Czech citizen at the moment of death. However, under certain circumstances Czech courts have also jurisdiction over inheritance left by a deceased foreigner if his/her property is located in the Czech Republic. The Czech court has the jurisdiction: (i) over Czech real estate of a deceased foreigner; (ii) if the country of deceased person’s nationality does not grant legal effect to the decisions of Czech authorities, blocks the inheritance of Czech citizens, or refuses to administer the inheritance proceeding; or (iii) if the deceased person had its residence in the Czech Republic and a heir staying in the Czech Republic asks the proceeding to be held here. Your real estate property located in the Czech Republic would be therefore subject to the probate proceeding held by the Czech court (or more precisely by Czech notary). According to the current Czech rules the governing law for inheritance proceedings will be the law of the state of which the deceased was a citizen (even if such proceedings take place in front of the Czech court).
Question, whether a person owning assets located world-wide should have only a single will or more wills is a crucial one. However, there is no clear answer which would cover all possible situations. Such person should always examine the laws of the countries where the property is located to find out whether one will is sufficient. Having only one will might bring a problem that sometimes foreign courts do not recognize a foreign will or part of its provisions (e.g. some kind of conditions and bequests or sometimes the Anglo-American legal concept of trusts). In such case having more wills – each concerning particular property – might be a way how to avoid the above stated problems.
To overcome problems with non-recognition of foreign wills the so-called “Convention of International Wills” was prepared and passed in 1973. This Convention harmonizes the laws of the signatory countries and creates a new type of will, so-called “international will”. This international will is recognized as a valid will in all countries that ratified the Convention. Nevertheless, the Czech Republic did not ratify this Convention; the same applies e.g. to the 1985 Convention on the Law Applicable to Trusts and on their Recognition.
Unless you want to leave your property to a statutory succession, you should always make a will. The form of the will should be chosen according to the law of nationality or by the law of the state where a will has been adopted. You have basically three options how to make a will in the Czech Republic: (i) write it by hand, date it (date, month and year) and sign it; (ii) write it otherwise than by your own hand (e.g. computer), date and sign it, declare in front of two witnesses (who are not heirs) that the document contains your last will and ask the witnesses to sign the will as well; or (iii) make a will in a form of a notarial deed. According to the current legal rules, you can choose your heirs in a will and decide the shares in which each heir shall inherit your property or you can determine which things or rights shall pass to which heir. The heirs can nevertheless agree on different division of particular assets. Any conditions contained in a will are not legally effective under the Czech law.
The new Czech Civil Code (which shall be effective as of January 1, 2014) introduces new rules regarding the content of a will. Newly, it will be possible and legally effective to include conditions into a will. Also it will be possible to make a bequest in a will (to order that certain person shall receive a specified thing from a succession). The new Czech Civil Code will also allow the testator to enter into an inheritance agreement with the future heir (in a form of a notarial deed).
Together with the new Czech Civil Code shall enter into force also a new Act on International Private and Procedural Law which replaces a concept of citizenship by a concept of habitual residence. It means that generally Czech courts will have jurisdiction to probate proceedings if deceased person had a habitual residence in the Czech Republic. Further, Czech courts will have exclusive jurisdiction over real estate located in the Czech Republic (which is the same as now). Regarding the governing law, the new Act on International Private and Procedural Law states that governing law in inheritance proceedings shall be the law of the state where the deceased person had his habitual residence at the time of death.
Regarding the EU unification and harmonization, there is no special treatment for the EU citizens or residents in current days. On August 17, 2015 the EU regulation no. 650/2012 on jurisdiction, applicable law, recognition and enforcement of decisions and acceptance and enforcement of authentic instruments in matters of succession and on the creation of a European Certificate of Succession (hereinafter the “Regulation”) will become legally effective for all the EU member states with the exception of Great Britain, Ireland and Denmark. The Regulation includes all civil-law aspects of succession of the estate of a deceased person and will therefore replace the Czech law described above. Basic general rule of the Regulation regarding the inheritance is that the courts of the EU member state in which the deceased had his habitual residence at the time of death shall have jurisdiction to decide on the whole inheritance. Also the governing law shall generally be the law of the state in which the deceased had his habitual residence at the time of death. Further, the Regulation introduces an option of the testator to choose a law of the state whose nationality a person possesses at the time of making the choice or at the time of death as the governing law for his/her succession. If the deceased made such choice and if such chosen law is the law of an EU Member State in which the Regulation is binding, the parties concerned can make an agreement that courts of such member state shall have exclusive jurisdiction over the succession.
Contact:
Monika Rutland, partner
rutland ježek, law firm
t: +420 226 236 600
About rutland ježek:
The rutland ježek law firm in Prague focuses mainly on business law, real estate law, litigation, finance and banking law; the firm is ready to provide adequate comprehensive consulting thus offering an alternative for clients of international law firms. The international dimension of the provided services is guaranteed by its track record and cooperation with leading law firms in most European countries, the USA and other jurisdictions. Czech lawyers of the rutland ježek team have long experience in providing legal consulting to transnational corporations, large Czech companies as well as medium size firms and individuals, acquired in leading international law and tax firms. More on www.rutlandjezek.com.
