What is a preliminary agreement and when to use it

A preliminary agreement is a legal commitment that two parties will enter into a specific contract in the future, once agreed conditions are met.
This ensures clarity and commitment before the main deal is ready.

Common use cases:

• real estate purchases

• employment starting after graduation

• company shares transfer with legal or financial conditions

• planned B2B contracts after approval

Legal framework

Regulated by Sections 1785–1788 of the Czech Civil Code.
Enforceable if:

• the promised contract is sufficiently specific,

• conditions are met,

• the proposal is made within one year (unless agreed otherwise).

Key elements of a preliminary agreement

• Identification of the intended future contract

• Subject matter and terms

• Conditions and deadlines

• Enforcement clause

• Optional: contractual penalty

• Signatures and date

Common mistakes

• Vague description → unenforceable

• Missing deadline to propose the contract

• No clarity on consequences of refusal

• No draft of the intended contract attached

• Confusion with non-binding offers

Recommendations

• Be as specific as possible

• Attach a draft of the intended agreement

• Define deadline and form of acceptance

• Add contractual penalty if the agreement is breached

Practice tip

This agreement offers legal certainty during preparation or transition – especially in real estate and startup investments.

Preliminary contract template – available for a symbolic fee

I offer a Czech-English preliminary agreement template for future contracts (purchase, lease, employment).
Fully compliant with Czech law. Custom versions also available.

Contact me via e-mail or form – clear and professional service.

FINAL THOUGHTS – WHAT NOW?

A preliminary agreement isn’t just a formality – it’s a legal shield, if drafted properly. And a trap, if not.

Do you want to be sure your contract will hold up even in a crisis? Get in touch and let’s schedule a meeting. I am a specialist on contract law – more information here.