Are "violation points" applied to EU licences outside of their home country?

There is no EU-wide system to handle penalty points and driving bans. In fact, those systems are probably more diverse than you realize, in some countries you ‘lose’ points until you have none and must surrender your license, in others you ‘gain’ points and exceeding a threshold has consequences. The number of points and thresholds for various offenses vary too and some countries do not even have a penalty point system.

What does happen is the following:

• Fines are increasingly enforced across borders. Your home country might reveal your address based on your license plate number or even go further than that and collect on behalf of the other country. There is a framework to encourage this at the EU level.
• If you reside in another EU country and drive there with your original license (which is perfectly legal in many cases) and commit an offense that results in a suspension or penalty points, you can be forced to exchange your license for a local one.
• Even if you don’t reside there, you can of course receive a ban in the country you are visiting. This ban won’t automatically apply to your country of residence.
• If you commit an offense abroad, you can get some penalty where you live, in some cases even if there is no penalty point system where you committed the offense, but that’s entirely up to each country. Conceptually, it’s not a foreign punishment being applied by the local authorities, it’s the local authorities applying their own punishment based on information they got from another country. There is no exchange of “data on traffic points” or any EU rules on each country is free to do what they want with any information they get about what you did elsewhere. Anecdotally, I think that Switzerland is for example very aggressive with this. Other countries don’t do it at all.

European Transport Safety Council Directives

Pre May 2015

Up until recently, individual European countries would set-up bilateral agreements regarding traffic regulation enforcement. This is the case for example for UK and Ireland; Switzerland and Italy; to name a few. Talks of unifying or regulating cross-border traffic infringements date way back. In 2011 an EU directive (n. 2011/82/EU) was approved and came into force in 2013, allowing drivers to be prosecuted cross-border. The legal basis of this directive were then deemed invalid in May 2014 by the European Court of Justice, and thus the EU began studying a new directive.

The Current State of Affairs (post May 2015)

According to this FAQ page from the European Transport Safety Council, the new European cross-border enforcement regulations (EU directive 2015/413) were approved in March 2015, and are to be transposed into national rules by all member countries (with the exception of UK, Ireland and Denmark) by the 6th of May 2015. This directive will allow countries to follow-up traffic infringements from foreign drivers, by accessing national vehicle registration details without the need for bilateral agreements.

The linked ETSC FAQ page describes eight major driving offences which can now be prosecuted cross-border:

• Speeding;
• Not using a seatbelt;
• Not stopping at a red traffic light or other mandatory stop signal;
• Drink driving;
• Driving under the influence of drugs;
• Not wearing a safety helmet (for motorcyclists);
• Using a forbidden lane (such as the forbidden use of an emergency lane, a lane reserved for public transport, or a lane closed down for road works);
• Illegally using a mobile phone, or any other communications device, while driving.

The functioning of the system is also described in the linked FAQ page. In short it leverages the current framework for mutual recognition for financial penalties, and a new cooperation system by which countries elect dedicated contact points responsible for handling such cross-border enforcement requests by other countries.

It follows that a mechanism for prosecuting road traffic infringements cross-border within the EU exists, and is gradually being enforced. This is not to say that all fines for offences committed abroad will be sent to your home, since the directive is left vague enough to allow countries some wiggle room. In particular, individual countries can choose whether or not to begin the cross-border prosecution procedure on a case-by-case basis – the mechanism is not launched automatically by all countries.

How About Point Systems?

The afore-mentioned directive does not mention point systems. To my knowledge these systems are country-specific, in terms of the number of points on a clean licence, the addition or subtraction of points, and the points per infringement. It would therefore seem that at the time of writing the lack of a common European driving licence point system determines a lack of control and prosecution mechanisms for point deduction/addition following traffic infringements.

And Country-Specific Driving Bans?

Being enforced in the country where the offence was committed (if applicable) it is safe to assume that driving bans will not depend on cross-border regulations. As Tor-Einar Jarnbjo mentions in his answer if committing a driving offence will cause you to be banned from driving in a country, then the ban will be effective as soon as the offence is processed by that country. You might or might not receive notification of this (this is not specified in the afore-mentioned EU directive) but you should nevertheless make sure you are aware of any bans you might have. You won’t like it should your driving licence come up as banned in that country during a random police check.

Point systems and driving bans are, unless national law says otherwise, country specific. There are no EU/EEA wide regulations for this subject.

What will happen, if you as a Czech resident with a Czech driver’s license manage to get so many violation points in Germany that they qualify for a driving ban, the German authorities will issue a driving ban for Germany.

The Germans may also inform Czech authorities about fines, points and driving bans, but it is as I said, up to Czech law and Czech authorities if that will have any consequences for you and if applicable what they do.

Even if it may sound illogical, the same principle (national jurisdiction) also apply the other way around. If you are a German resident with a German driver’s license and the German authorities issue you a driving ban, this driving ban is per default also only valid for Germany. Unless restricted by national law, you may still be allowed to drive in other countries.