As a part of the services provided by our law firm, our clients can place financial means (or documents if related to the escrow funds) in escrow. Escrow presents an effective way of the protection of clients’ financial transactions, trade transparency, and ensuring the fulfilment of contractual obligations. The law firm acts as a guarantor and is legally accountable for the finances in escrow to be used in a manner pursuant to the contract or the legislation.

Escrow is typically used in relation to real estate purchase agreements. When using escrow connected with transfer of real estate property, an escrow and custody agreement is concluded, based on which one party deposits money for another party to a special bank account of our law firm, opened and marked for that purpose. The escrow funds are deposited on the escrow account separately from any other funds of the law firm or from other clients’ funds at all times. After all the conditions defined under the escrow and custody agreement (which sets forth all rights and obligations of both contractual parties as well as the law firm) are performed, the law firm disburses the funds held in escrow to the authorized person.

Should escrow be used for purposes other than real estate property transfers, bilateral or multilateral agreements shall be concluded, the content of which is always adjusted to meet the particular needs of the business transaction in question.

To protect clients’ funds, please note that escrow services are regulated by legal and professional regulations of the Czech Bar Association, which also supervises the observance thereof by means of electronic escrow registry, where the lawyer is obliged to report all the escrow performed thereby, as well as their own supervisory bodies.

Our fees for providing escrow services of funds are as follows:

  • 4,000 CZK excluding VAT for escrow of amounts not exceeding 1,000,000 CZK
  • 6,000 CZK excluding VAT + 0.1% of an amount exceeding 1,000,000 CZK for escrow of amounts exceeding 1,000,000 CZK to 10,000,000 CZK
  • 20,000 CZK excluding VAT + 0.01% of an amount exceeding 10,000,000 CZK for escrow of amounts exceeding 10,000,000 CZK.

The aforementioned fee includes drafting the escrow and custody agreement, bank account fees, documents held in escrow if related to the transaction in question, as well as any other costs of the law firm occurred in relation to the escrow. However, the fee does not include the law firm’s potential compensation for the preparation of the accompanying agreement documentation (e.g. purchase agreement) if required by the client.