Lawyers have no consensus on whether to valorise the capital returned to financial institutions by CHF loan holders. Following the ruling of the Court of Justice of the European Union of 15 June this year, which was favourable to CHF loan holders (C-520/21), banks have no right to remuneration (other than interest) for the use of the loan; hence they are increasingly bold in requesting that the capital returned to them be valorised. This has indeed been predicted by Tadeusz Białek, the President of the Polish Bank Association.
The CJEU has handed down two judgments concerning Swiss Franc loan holders. According to the first, banks cannot demand remuneration for using loaned capital from consumers. The second stipulates that a suspension of instalments can be expected pending a dispute regarding the invalidation of the contract.
Lawyers do not foresee major deviations by the EU Court from the February opinion of its Advocate General, favourable to consumers, on the issue of remuneration for using the loan.
Addressing offers only to mobile app users is a right of retailers, although, in practice, it disadvantages some shoppers. The points awarded while shopping at an increasing number of retail chains have a real bearing on later discounts, which can be obtained after collecting a sufficient amount of them. However, what is an opportunity for additional shopping profits for some, may give others the feeling of being an inferior customer.
The Supreme Court is to address the increasing problem of filing different claims regarding the same matter in Swiss Franc agreement settlement cases. Filing different claims, lawyers point out, creates uncertainty for Swiss Franc credit holders as to which one will be considered by the court.
The 21 March 2023 issue of ‘Prawnik’ features a column by Stanisław Drozd, attorney-at-law, entitled ‘How Arbitration Should Not Be Promoted’. According to the author, the recent amendment of the Polish arbitration law providing, among others, the possibility of converting court proceedings into arbitration does not address the problems of the Polish judiciary. Although I usually agree with Stanisław Drozd’s journalism and share many of his observations, I am afraid I have to disagree with some of his theses this time.
Only until 15 April 2023 can borrowers from all over Poland file lawsuits to the Franc Court in Warsaw. An amendment which will force the choice of a local civil court after this date was published in the Journal of Laws on Friday. The just-published amendment to the Code of Civil Procedure forces the filing of Swiss Franc-related lawsuits from outside left-bank Warsaw to local civil courts. The question is how much more difficult will this make it for Swiss Franc credit holders to pursue their cases. After all, they brought their cases to the Franc Court voluntarily and willingly.
The extended composition of the Supreme Court is to examine whether a critical issue for bank customers at the moment, the so-called “right of retention”, does not demolish their consumer protection. The question is whether this tool in the hands of banks, used at their request by the courts, is reconcilable with the EU Consumer Directive. The issue was referred to the seven-member panel of the Civil Chamber of the Supreme Court by three judges of the Supreme Court: Tomasz Szanciło, Beata Janiszewska and Marcin Łochowski. It is all the more topical as banks, in cases brought against them by customers who took out loans in Swiss francs, are increasingly requesting the application of the right of retention, which makes it very difficult for the consumer to enforce the amount owed to them (more in “Rz” of 3 February 2023 “Right of Retention a Bane for Swiss Franc Debtors”).
A consumer can request the invalidation of an agreement when they were unaware of its flaws.
The number of borrowers’ settlements with banks has increased in recent months. However, after the opinion of the CJEU ombudsman favourable to consumers was issued, many are asking about the possibility of withdrawing from the settlement.
We are talking about not renegotiating the settlement, which is possible within the framework of an agreement but invalidating it, which can be done in court. This is usually more difficult than getting the loan agreement invalidated. There have already been cases like this, but they concerned settlements concluded much earlier.
The Advocate General of the CJEU is expected to announce an opinion on Thursday on whether banks are entitled to remuneration from consumers for using loans deemed to be fraudulent.
This is currently the most critical outstanding issue in the Swiss Franc disputes. The Ombudsman’s opinion is not formally binding on the CJEU, but it provides a guess as to what the verdict will be, which will probably come in a few months. And already now, it will affect the sharpness of the disputes or the chances of settling them amicably.
Residents whose homes have been affected by mining damage can claim compensation. This is a problem faced by residents of Trzebinia in the Malopolska region, where the ground has started to cave in at the site of a mine that is no longer in operation. At first, cave-ins formed in the cemetery, then also in residential areas. For now, no one is talking about evacuation, but fears are growing.
The vital issue of the so-called right of retention for banks and consumers has not been resolved. The issue is whether a bank can withhold payment to a consumer when settling an invalid contract before reimbursing the consumer. The Supreme Court hearing announced for mid-January has been postponed until February.
The CJEU rulings will determine whether more borrowers will feel encouraged to bring actions against the banks. Lawyers specialising in Swiss franc loans are analysing what lies ahead for their clients in the coming months and year. These are not only legal issues but also procedural and organisational issues, such as the capacity of the courts.
Tenants looking to change flats during the year should check their electricity bills, as they may pay higher rates for the profligacy of their predecessors. They will also miss out on some preferences if they fail to get the meter registered in their name – for example, if they are a person with a disability. They can also most likely say goodbye to the lower electricity price in 2024.
In drafting the new regulations to mitigate the effects of rising electricity prices, the government apparently did not take into account the fact that many people move house and rent flats. Therefore, the tenant should check whether they will benefit from the preferences before signing the lease.
There is a chance for rapid adoption of legislation that will remove barriers to offshore wind energy development. A package of relevant amendments to various laws has been appended to the special gas bill, which the Senate is now processing. Meanwhile, a draft of similar changes concerning onshore windmills, where investments have been blocked for several years by the current law, is still pending.
When negotiating and performing contracts, the parties do not usually assume that their cooperation will end in a dispute that may find its finale in court. They are anxious to agree on the essential business assumptions of transactions so that they produce a tangible business effect as soon as possible. Unfortunately, experience shows that an approach that completely excludes or even marginalises the risk of a dispute involves a severe risk of losing, should a potential dispute end up in court.
Lawyers say that EU Court judgments will decide the chances of claims for capital repayment and remuneration. Now the banks are suing the Swiss Franc credit holders. Banks that Swiss Franc credit holders have sued are increasingly calling on them to return the capital (plus interest) under pain of a lawsuit. These, by the way, have already been coming before the courts for several months, including the Swiss Franc court (i.e. the XXVIII Civil Division of the District Court in Warsaw). The banks are requesting the suspension of proceedings in actions brought by Swiss Franc credit holders until the conclusion of the new case.
As with most different processes, communication plays an essential role in the course of court proceedings, whether it is communication with the court, with the opponent, or between the party and its legal representative. Let us look at the latter. Although you will probably not have heard of a lawsuit won only because of efficient communication between the party and its attorney, many parties have, at the very least, severely complicated the proceedings because of ineffective communication with its representative or due to a lack of communication at all.
Borrowers are looking for ways to withdraw from their contracts as instalments rise. Along with the increase in interest rates set by the Monetary Policy Council, WIBOR, the rate on which PLN loans are based, has also increased. Whilst the 3M and 6M WIBOR rates were less than 0.3 per cent a year ago, they have now reached 7.15 per cent and 7.33 per cent, respectively. As a result, loan instalments were not uncommon to double in just one year. It has prompted some bank customers to go to court.
The injured parties should gather evidence to demonstrate the extent of the damage. The chances of a trial will be assessed once the culprits have been identified. For the time being, we do not know the possible perpetrators or the exact damages caused by the poisoning of the Oder. However, many companies, not only the tourist companies of Western Pomerania but, e.g. the Angling Association, are already estimating them. There are also questions about the order of the injured parties’ actions from the legal side and their chances of compensation. Lawyers agree on one thing: only after the perpetrator or perpetrators of the river contamination have been identified will there be time to file a claim. Then, the aggrieved will also be able to assess the chances of success of the specific legal steps.
Marta Bledniak, attorney at law at the Toulouse Bar Association, a foreign lawyer at the Regional Bar Association in Krakow and Munich, and Wojciech Wandzel, attorney at law and partner at the Kubas Kos Galkowski law firm, talk to Ryszard Żabiński.
Similarly to holders of loans in Swiss Francs, holders of loans in PLN may resort to the court, demonstrating the abusiveness of the clauses of their contracts.
However, if Prime Minister Mateusz Morawiecki’s proposals, including the replacement from 1 January 2023 of the WIBOR rate with another transparent rate derived from the interbank market for overnight deposits, proved attractive to borrowers, they may discourage them from resorting to court to have their loan agreements invalidated.
Holders of loans in PLN may follow the path of tens of thousands of Swiss franc loan holders. What are their chances? The first statements of claim are already in the courts. Others are under preparation.
‘PLN loan agreements in which the amount of the principal and interest instalment depends on the WIBOR reference rate may, in many cases, prove invalid or at least ineffective with respect to the manner of setting loan interest rates. In the best-case scenario for banks, this will mean that they will not be able to add WIBOR to the instalment and will have to return overpayments.’
A court decision on the composition of a group in group proceedings may be challenged with a classic appeal before the court of second instance, the Supreme Court has ruled. In the case of 300 Swiss franc loan holders, a consumer ombudsman in Szczecinek, the regional court determined the group’s composition, which was challenged by Bank BPH, which demanded the exclusion of some of the persons. The bank had doubts as to which court to address its complaints to and lodged two: one with the Court of Appeal in Gdańsk and the other with a different composition of this Regional Court. It pointed out that there are no provisions indicating the court competent to hear a complaint in such a case, and the practice of the courts is divergent after the extensive amendment to the Civil Procedure Code entered into force in 2019.
For several hours, billions of users were unable to use Facebook and several other related sites. Do they have any chance of compensation? Facebook executives have reached out to its users to apologize and thank them for their understanding, but will this be enough? Will lawsuits not ensue? And if so, what are their chances? We are interested in Polish users here, although it will be essential to see how people in other countries react to this failure and what they may be able to get.
The biggest reform of the Code of Commercial Partnerships and Companies (KSH) in 20 years is approaching. It introduces comprehensive regulations concerning groups of companies into the Polish legal system. What are the advantages and disadvantages of participating in such a group? Who will benefit and who may lose? How will binding orders affect group management? These issues were discussed by experts during a conference on the Code of Commercial Partnerships and Companies, organised by Puls Biznesu.
Fitnes club operators are seeking compensation for restrictions on their business operations during the epidemic. On Thursday, they filed a class action in the Warsaw Regional Court against the government and the minister of health, demanding the court to determine the State Treasury’s liability for damages in connection with administrative bans on the operation of gyms and fitness clubs, i.e. for the lockdown of the fitness industry.
In order to settle with the bank, the Swiss Franc credit holder must declare whether they will maintain the contract with unlawful clauses or wish to cancel it. That is the crux of Friday’s resolution of the seven judges of the Civil Chamber of the Supreme Court responding to a question from the Financial Ombudsman.
The Court of Appeals in Łódź issued a final ruling that the victims of the flood of May 2010 are entitled to compensation. Almost 30 farmers may now claim specific amounts. The judgment was issued in group proceedings. The damages must be paid jointly and severally by the Governor of the Mazowieckie Province, Państwowe Gospodarstwo Wodne Wody Polskie (“Polish Waters” State Water Holding), and the Mazowieckie Province.
Was the government obligated to introduce a state of national calamity, as it is now being accused in legal actions for compensation of losses due to the lockdown? The answer to this question does not have to be unequivocal – a state of natural calamity may be introduced when ordinary constitutional measures are not sufficient, and it should be remembered that certain regulations, including those limiting the rights and freedoms of citizens to a necessary extent, may be and are introduced by statute.
There are many arguments in favour of choosing an out-of-court method of dispute resolution. Even before the pandemic, there was no doubt that hearing some business cases in arbitration was more beneficial for the parties than in a court of law. The lockdown and the subsequent stages of the pandemic show that arbitration copes (and, above all, more efficiently and quickly) with challenges better. It is worth reminding parties who are stuck in common court that it is possible to transfer their case to arbitration. Of course, this requires concerted cooperation, which is sometimes not possible. However, if everyone is interested in a speedy resolution, this solution is worth considering.
Giving a reading list is not studying – emphasise the students and demand a reduction in tuition fees. Law students at the University of Warsaw are demanding a reduction in fees because, in their opinion, remote classes fall short of adequate standards. The cost of such online part-time courses is PLN 8,500 per year or even higher because individuals opting for payment in eight instalments will have to pay PLN 9,360.
Although Article 3 CCP constitutes a sufficient basis for the construction of the abuse of procedural law, under the amendment of 2019, a decision was made to introduce Article 4, which in fact reproduces the construction of the abuse of procedural law formulated and accepted in literature and case law under Article 3 CCP. The abuse of procedural law is not structurally identical with the abuse of a subjective right in substantive law (Article 5 CCP) and therefore the general sanction of ineffectiveness of actions qualified as abuse of procedural law, analogous to the one provided for in substantive law, was not provided for, whereas the legislator limited the sanction to financial consequences in several cases provided for in the Act. This calls the function of Article 4 CCP as a source of a general, useful construction in civil proceedings into question.
Group proceedings have been an element of the Polish legal system since 19 July 2010, when the Act on Pursuing Claims in Group Proceedings (APCGP or the Act) entered into force. The Polish legislator has been ahead of many European countries and has responded to the European Commission’s initiatives to improve collective redress procedures. The solutions for these procedures adopted in different countries differ from one country to another.
Teachers from Krotoszyn filed a class action and won the case for overtime. The lawsuit was filed in December. The proceedings were therefore quite short for group proceedings, thanks to the fact that the labour court treated the teachers’ cases as a priority. “A complex evidence procedure was not necessary either,” points out Jakub Kalak, the teacher’s attorney. The verdict is not legally binding, as the local government operating the school has filed an appeal.
The entry into force of the GDPR and appropriate Polish regulations extends the possibilities of court protection of privacy. The principles for handling of personal data in the whole of the EU are defined by regulation (EU) 2016/679, whereas the procedures of protection against violations are provided for in Poland by the new Act on Personal Data Protection. Both these acts of law shall enter into force on 25 May. Next to the administrative measures of protection against decisions of the President of the Office for Personal Data Protection (successor of the Inspector General for Personal Data Protection), guarantees each person the right to effective protection, if their rights were violated as a result of the processing of their personal data.
The Supreme Court has finally announced its long-awaited stance on the legal relevance of an injury sustained by relatives of a person injured by an unlawful act. Previously, it was unknown in what cases, if at all, the determining of legally binding liability for tort causing damage to a person, consisting in his loss of health, may be recognised as violating the personal rights of the injured individual’s family members.
Invoking consents for personal data processing granted prior to the entry into force of the EU regulation will be possible, however, only upon meeting several conditions. 25 May 2018, i.e. the day on which the EU General Data Protection Regulation will acquire direct legal force in the domestic legal order, is inexorably drawing near. Several weeks prior to the new provisions’ entry into force, doubts assume the form of increasingly more specific queries. Already today, many entrepreneurs are searching for specific guidelines as regards actions to be taken before the ‘zero hour’ strikes. Due to the specificity of obtaining clients’ consent for the processing of their personal data, i.e. the time-consuming nature of this process and its costs, one of the more important issues faced by institutions processing personal data, with entrepreneurs at the lead, is the preservation of validity of the consents granted prior to the GDPR’s entry into force.
After the demise of an entrepreneur operating a single person company, legal successors do not entertain a possibility of smooth continuation of the activity. This problem is to be solved by the Act on Succession of Family Companies which is to enter into force as early as on 1 June 2018. The changes introduced in the Act affect at least two million companies.
Not only may causing property damage to a company result in being held liable with one’s own property and the need to redress the company for the sustained damage, but it may also lead to criminal liability, including the penalty of five years of imprisonment.
As Rynek Prawniczy informed, Kubas Kos Gałkowski Law Firm represented the injured parties in a class action to the collective statement of claims in the case regarding the compensatory liability of bodies of government and self-government administration for damages suffered during the flooding in spring 2010, after the proceedings of seven years, the Regional Court in Krakow ruled in October 2017 that the State Treasury represented by the Head of Regional Water Management Board in Krakow and the Self-Government of the Świętokrzyskie Province, bear joint and several liability for damages sustained by the flooding victims as a result the breaking of the levee on the Vistula River near Sandomierz.
Entrepreneurs will be obligated to demonstrate, at the office’s request, that the specific solutions have been considered from the point of view of their compliance with the general data processing principles and, first and foremost, that they are fully compliant therewith. In mid-September a draft of the new Act on Personal Data Protection was brought into daylight. The new act is to serve the purpose of adapting the Polish regulations of personal data protection to solutions provided for in the Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (Text with EEA relevance) (hereinafter: RODO).
An arbitration clause is an agreement regulated under 1161 (1) CCP according to which submitting a dispute for settlement by an arbitration court requires an agreement between parties which should indicate the object of a dispute or a legal relationship out of which a dispute has arisen or may arise (an arbitration covenant). In practice, if the objective is not a compromise – i.e. an arbitration covenant pertains to a dispute which has already arisen between parties – deciding to choose arbitration, parties mostly invoke the legal relationship from which the disputes might arise, indicating that such disputes shall be subject to the case-law of an arbitration court.
The idea of information society is almost half a century old and seems to have been exhausted. The total computerization of social life puts us up against an analytical paralysis – we have unlimited access to information in quantities which the human brain is no longer capable of processing. The transformations of the last decade therefore induce a reflection on the new fuel for economic development. The increasingly more often appearing answer is: data.
“A good cross border lawyer should be open minded and always try to see the bigger picture.” Mr Paweł Sikora specialises in company law and civil procedural law. He handles the provision of comprehensive legal services and prepares effective procedural strategies. He focuses on IT and start-up projects as well as mergers, acquisitions, and other forms of restructuring and bankruptcy. He is experienced in providing consultancy services to domestic and foreign investors during negotiations on the signing of land lease, building and premises lease agreements at further stages of the investment process.
Any person to have attentively followed the 2016 election campaign in the US, was well aware that a speech as the one delivered in Warsaw’s Krasińskich Square with the main thread set out by ‘will’, ‘values’, and ‘ideals’ of the Western civilisation faced with multiple threats simply had to appear, sooner or later, in Donald Trump’s presidency. Already in August 2016, while still on the campaign trail, Donald Trump emphasised the significance of the ‘ideological struggle’ straightforwardly invoking the historical example, i.e. the fact that ‘exposing the evil nature of communism and highlighting the virtues of free market’ not in an insignificant degree contributed to the NATO’s triumph in the Cold War.
Ladies and Gentleman, I have listened very carefully to your statements and I am under the impression that we are dealing somewhat with a situation entailing convincing the convinced. This means that we are discussing the value of judicial independence that we all certainly know is an essential element of any state aspiring to the role of the state of the rule of law.
In his feature article for the Rzeczpospolita daily, Professor Gwiazdowski dedicated a few words to the globally increasing wave of protectionism (also aimed against Poland, e.g. by France). To refute the arguments of protectionists (or neo-mercantilists), Professor Gwiazdowski invokes the figure of David Ricardo and the example of relations between Portugal and England in the 18th and 19th centuries. This short essay is by no means a polemic in its nature – Professor Gwiazdowski correctly castigates the new French President’s protectionist zeal targeting Poland. I would rather focus on developing certain threads touched upon in the text.
Class actions will be examined faster. Debt recovery is to be facilitated by new ways of establishing a security on the debtor’s assets. The new instruments are included in the lion part of the act ‘facilitating debt recovery’ which is to enter into force on 1 June in Deputy Prime Minister Mateusz Morawiecki’s debt package. It amends ten statutes, including the Code of Civil Procedure applicable not only in civil, but also in commercial cases.
A sole proprietorship is permanently bound to the entrepreneur. The entrepreneur’s death frequently results in the paralysis of the company’s operation. If the inheritors cannot come to an agreement, inheritance acquisition and division of the estate procedures may be significantly prolonged, thus thwarting any chances of business reactivation. The drafted amendments of regulations may signify a substantial change. What will this change be?
One of the basic obligations of a limited liability company shareholder is the making of a cash contribution or a contribution in kind with the aim of covering the shares issued in exchange. In this latter case, a shareholder will be held liable if the value of the contribution in kind is overstated. The provisions of the Commercial Companies Code do not offer detailed provisions as to what may be a contribution in kind to a limited liability company.
Immediately before the hearing before the Supreme Court, the bank withdrew the cassation complaint regarding the insurance of low contribution. The withdrawal of the cassation compliant means that the bank will reimburse its clients for the premiums paid as the insurance of their low own contributions. This is not necessarily a good solution for other loan recipients.
An expedited procedure will be available to all entities which decide to submit their dispute for adjudication by the Court of Arbitration at the International Chamber of Commerce. In the understanding of lawyers and entrepreneurs arbitration is a faster, yet undoubtedly more expensive alternative to common courts. Wishing to avoid entanglement in long-lasting court proceedings, entrepreneurs prefer to agree to submit potential disputes to the jurisdiction of arbitration tribunals, where they will be able to exert influence in terms of their composition (appointment of arbitrators) and which will settle their dispute in a single instance. Considering the time of the examination of cases by common courts, it’s easy to understand this tendency.
Lawyers are sceptical about appointing special courts for recipients of loans in CHF whereas they consider the specialisation of judges to be useful. Marek Niechciał, the President of the Office of Competition and Consumer Protection wants to suggest the Minister of Justice the establishment of special court divisions designed to deal specifically with loans in foreign currencies. They are to guarantee faster processing of CHF loan holders’ cases. There is no doubt that there seems to be no end to the litigations. The example of Spain may serve as a confirmation of this. Problems with loans in foreign currencies in Spain began earlier than in Poland and court cases have to wait up to eight years for final settlement. In the opinion of law practitioners, the idea promoted by the of the Office of Competition and Consumer Protection will not help to prevent a similar situation.
Under the provisions of the Commercial Companies Code, there are several modes for the dissolution of a limited liability company, not equivalent with its liquidation. The dissolution of a company due to formal causes as well as due to the object of its operations contradicting the law is regulated in the general part of the Code, i.e. in Article 21 CCC. Such a dissolution is performed by the registry court ex officio or to the motion of a party with a legal interest therein. In turn, Article 270 CCC provides for the dissolution of a company due to causes stipulated in its articles of association, shareholders’ resolution on the dissolution of the company, a resolution on moving the company abroad, declaration of the company’s bankruptcy, and other causes provided for by the law.
The reform of the judiciary seems to have become a national sport of sorts. Subsequent ministers have grappled with it with little visible effects. We have asked several dozen law practitioners: judges, attorneys-at-law, counsels, court enforcement officers what, in their opinion, hindered the functioning of the courts and how to make them more efficient. Although their responses do differ in details, a very coherent and concrete diagnosis seems to be emerging from them. Court blockages are due to: poor organisation, the non-existence of an IT system supporting the functioning of the courts, and low activity of judges.
A debate is ongoing in the US whether the next President should appoint a special advisory body composed of historians. All this is due to a Scottish-born historian, Harvard Professor Niall Fergusson, hailed by The Times to be among one hundred of the most influential people in the world. Yet, the Scottish scholar’s proposal has nothing in common with what is termed as ‘historical policy’ (or ‘policy of remembrance’) in Poland. It rather aims to engage historians into advising the President of the US in adopting current internal and foreign policy decisions.
Small amounts from mass claims, e.g. consumer, could be pursued in actions where a group would be formed automatically, the Ministry of Development suggests. The Ministry has drafted assumptions of a reform extending the scope of group proceedings, which in July 2016 were passed for pre-consultations to, among others, legal circles.
In its judgment of 13 May 2015, the Court of Justice of the European Union confirmed the exclusion of arbitration from the scope of application of the EC regulation and gave the green light for anti-suit injunctions. An anti-suit injunction is an instrument known in common law jurisdictions. Its aim is to grant the effectiveness of an arbitration agreement, as well as to direct the parties to arbitration. The party which seeks to prevent the other party from conducting legal proceedings before state courts, often lengthy and expensive, may, in some jurisdictions, motion the court to prohibit such actions, thus “forcing” the opponent to conduct arbitration. Such an instrument is certainly unknown in the Polish – or even continental – legal orders.
The question seems to be gaining in significance in connection with the well-known matter concerning owners of vehicles manufactured by Volkswagen AG. In some models, including: Golf, Passat, and Audi A3, manufactured in the years 2009-2015 software allowing users to understate NO and CO2 emission level readings was installed. Volkswagen Group Polska confirmed that almost 140 thousand of such defective vehicles were introduced on the Polish market. Lawyers drafting statements of claims against Volkswagen AG have indicated provisions on the implied warranty as the most important legal basis of the claims.
The year 2015 has brought two important changes pertaining to arbitration in Poland. The first has been introduced by the Act of 15th May 2015 – the Restructuring Law (hereinafter: RestrLaw). The second of the mentioned changes is an amendment of 24th July 2015 on the amending of certain acts in connection with supporting alternative dispute resolution and it is presently awaiting the President’s signature. Both will enter into force on 1st January 2016.
A negative economic assessment carried out by shareholders does not suffice to effectively challenge a merger. Specific prerequisites should be fulfilled. The merger of corporations, and also of corporations and partnerships, constitutes a frequently used tool for increasing performance and reducing costs, a tool allowing for various synergies to be achieved.
The Ministry of Economy estimates that disputes in commercial matters cost entrepreneurs around PLN 40 billion annually, court proceedings last 480 days on average and the wait for the enforcement of the verdict – another 145 days. For this reason, the team appointed by the Ministry of Economy and the judicial sector is working on solutions which are aimed at facilitating and popularizing medication and amicable dispute resolution. Financial incentives are to be of key importance.
The reason for resigning from specific amounts in group proceedings is the mechanism of standardizing the claims, which are to take the “mutual circumstances of the case” into consideration. Most of the problems occur with the formulation alone. The question arises as to which mutual circumstances are being referred to. Those, which impact the amount of the claim of a given group member, meaning the damaging events as well as its effects: the type and scope of damage, should certainly be taken into effect. The simplification of this mechanism would allow group proceedings to be used more efficiently.
Are there rules in force in Poland for the appointment of arbitrators in arbitration proceedings which reflect international standards? Kamil Zawicki, attorney at law YES. At present, the Polish rules – both code regulations as well as regulations of the leading arbitration institutions, for example SAKIG or Confederation Lewiathan Arbitration Court – reflect the assumptions of the Model Act (UNCITRAL Model Law from 1986, amended in 2006), giving the predominance of the will of the parties in first order.
Does the current wording of the provisions of the Code of Civil Procedure hamper the acceptance of the thesis that disputes on the validity of resolutions in commercial companies can be settled in arbitration? Rafał Kos, attorney at law, partner at KKG Kubas Kos Gaertner: No. Which does not mean that the current wording facilitates motioning on the lack of limitations of arbitrability of all corporate disputes.
The popularization of alternative dispute resolution methods allows the number of traditional civil proceedings with the participation of entrepreneurs to be reduced (…). Kamil Zawicki, attorney at law, Chairman of the Allerhand Institute’s Dispute Resolution Section and partner at KKG Kubas Kos Gaertner, cites the results of a report prepared for the European Commission in 2012 on alternative dispute resolution (ADR) mechanisms.
The draft of the amendment to the Act on the National Court Register (hereinafter “NCR” Act) accepted by the Council of Ministers in July is to facilitate the conducting of business activities for entrepreneurs. The assumptions to the act forecast revolutionary changes in the scope of the functioning of the “single window”.
Most importantly, the act on amending the act on the issuance of the Court and Commercial Gazette as well as the act on the European Grouping of Territorial Cooperation (hereinafter: Act) implements the principle of publishing the Court and Commercial Gazette in electronic format. This means the resignation, on the part of the legislator, from receiving the paper version of the publication.
Competition is the driving force of a free market economy. Entrepreneurs competing for clients are constantly working on new, better and more effective solutions and products. It is competition that has resulted in e.g. laptops, smart phones, previously tools of only the most affluent, reaching a wide range of consumers. Indeed, a question arises whether it is something bad for an entrepreneur to take over the clients of their counterparty? Under the Polish law – yes, but only when this violates the generally accepted market regulations.
Maciej Durbas, associate at Polish law firm KKG Kubas Kos Gaertner, tells ACQ Magazine why there’s less emphasis on the ‘alternative’ part of ADR these days as it continues to challenge the more traditional court litigation. In many cases the advantages of ADR, when used effectively, appear to be beyond dispute. The use of the word “alternative” in the term Alternative Dispute Resolution seems to presuppose that methods, different from the state court litigation, are unusual or constitute a “backup” for what was considered to be “normal”. The reality of cross-border commercial disputes proves to the contrary. Contemporary business is getting closer and closer to the moment when it is litigation that will be treated as exceptional.
What was 2010 like for the markets in Poland? Back in 2010, which was called “a year of transition”, many investors were looking towards 2011 as the first year of “normality” in the global economics. Evidence of these beliefs in 2010 could be seen in the IPO’s of the Warsaw Stock Exchange and PKO Bank Polski (the biggest retail bank in Poland), which both had spectacular success. These expectations turned out to be correct, since almost all macroeconomic factors returned to the levels preceding the worst moments of the crisis, even though the Polish economy did not in fact suffer as much as our European neighbors.
Where does this thin line run that a defender must by no means cross to avoid being branded “a mafia advocate”. In speaking about themselves they maintain that they do not defend angels, however, they are outraged at the label of a “devil’s advocate”. They are to take care of their client’s right to defence; however, they are frequently accused of breaking the law for their client’s sake. Recently, attorneys have been experiencing a bad run, being targeted by the media, or even by the prosecutor’s office.
In connection with the planned decrease in the OFE contributions, an idea to file a class action against the government has been suggested. Is it possible to conduct class action proceedings in such a case? The chances for an effective lodgement of a class action for damages on the grounds of the changes planned in the OFE system are very faint for several reasons. Appearing before a common court of law within a class action with a claim concerning the damage resultant from the adoption of an act introducing changes to the OFE system would require that the said act be recognised unconstitutional by the Constitutional Tribunal. This follows from the regulation of Article 4171.1 of the Civil Code which in the case of damage inflicted by an issuance of a normative act renders the possibility of demanding the repair thereof conditional on the ascertainment of the non-compliance of such an act with the constitution, a ratified international agreement, or an act.
The provision of pro bono services is the fundamental form of the Corporate Social Responsibility in law firms. Corporate Social Responsibility (CSR) is a concept, gaining in popularity in developed countries, in keeping with which profit-oriented enterprises, including huge corporations, in their operations they ought to take into account social interest, environmental requirements, and their employees’ needs. Such an approach is already becoming a business standard also in international law firms which implement energy and paper saving programmes, get involved in charity actions, or ensure friendly work conditions.
Entrepreneurs who paid ZUS contributions along with interest for the period during which they had unregistered from the insurance will pursue damages from the institution before the court. They seek the return of the paid interest. Krakow’s Kubas Kos Gaertner law firm wants to lodge a class action against the ZUS before a civil court on behalf of the entrepreneurs. They will seek damages for having been misled by the ZUS officers who had allowed them not to pay the contributions during the period over which, in their opinion, they had unregistered their business activity. Now, ZUS demands them to pay the contributions from before 20 September 2008, i.e. from before the date of entry into force of the provisions formally allowing for the suspension of business activity, along with the accrued interest.
We can make use of other people’s photographs within the frames of fair use whereas using a photograph as information does not require notification of its author. Preparing Internet publications on a famous photographer, we frequently include in them photos taken by the author at issue. Posting photographs of our favourite artist in the Internet may, however, constitute a breach of the law. “It is a rule that to distribute a work, including posting it in the Internet, the consent of the party with the title to the copyright is required. Situations when works can be used without the author’s consent are so-called fair use situations,” Kamil Zawicki, a partner of the Kubas, Kos, Gaertner law firm points out.
A person buying presents online may withdraw from such a transaction (return the present) within 10 days from the delivery of the item. An unpacked CD cannot be returned. Each Christmas, many Poles receive gifts that fall far from their tastes. A specific problem can appear when a top size too small or a faulty gadget were purchased online. “One should remember that e-shopping is not only the convenience of shopping without leaving your house and avoiding crowds, but also a risk of encountering a dishonest seller who instead of delivering the ordered goods sends us trash,” Kamil Zawicki, partner at the Kubas, Kos, Gaertner law firm points out.
The receiver in bankruptcy examination will not contain an oral part and no points will be taken of for a wrong answer in the test. Persons acting as receivers in bankruptcy without a licence will be able to appear in bankruptcy proceedings for additional nine months counting from the entry of the new provisions into force. Such an amendment to the draft of the act on the receiver in bankruptcy licence was adopted on Friday by the Justice and Human Rights Committee. The new provisions will be subject to voting at the nearest session of the Sejm. “The planned changes constitute an obvious simplification for people applying for the licence of a receiver in bankruptcy,” Paweł Sikora, and attorney-at-law of the Kubas, Kos, Gaertner Law firm indicates.
A client of a bankrupt developer cannot count on the return of the advanced payment. “The lack of regulations in terms of so-called Developer Agreement that would protect clients against developers’ unfair practices constitutes a significant flaw of the real estate market,” emphasises Rafał Kos, attorney at law and partner at the Kubas, Kos, Gaertner law firm. The problems of Krakow’s Leopard with debts amounting to PLN 140 million or of Wrocław’s company Architect 21 come as only several examples of the bankruptcy wave on the market which took place within last year. A purchase entails a debt for several dozen years. This is why while purchasing real estate particular attention should be paid to the traps waiting for clients in developer agreements. As a rule, their provisions protect the interest of the selling party only.
This month ACQ Magazine looks at professional negligence in the UK and class action in Poland. Rafal Kos is from Kubas Kos Gaertner, a Polish law firm based in Warsaw. The recently passed Act on the collective pursuit of claims is a revolutionary change in the disputable proceedings system in Poland. The Act is purported to transplant the institution known in the American law as class action and in the European law model as collective claim to the Polish civil litigation system.
Litigation usually increases in bad economic times. When money is tight, the stakes in commercial disputes are much higher, as is the importance of securing a fast and cost-efficient resolution to a client’s disputes. In the fallout from the financial crisis, have you seen an increase in commercial disputes? What is the nature of this conflict?
Last month a regulation constituting a breakthrough change in the provisions on civil proceedings was passed in Polish parliament. Mr Gałkowski, Partner from Polish law firm Kubas Kos Gaertner Adwokaci, told ACQ Magazine about the new regulation. According to Mr Gałkowski, the act foresees the possibility, in certain cases, of the joint pursuit of claims in matters of claims of one type, based on the identical factual or legal basis. These can now be pursued by at least 10 people, provided the significant factual circumstances substantiating the demands are common for all the claims.
Polish stock-exchange companies misleading investors by publishing unreliable information have the most to fear from class actions. Investors can collectively file actions with claims for the drop in value of stocks. Moreover, also damages for losses suffered in the past can be pursued collectively as in the US where actions brought forth by stockholders against companies disseminating unreliable information constitute the most popular class action category.
It is difficult to imagine a more spectacular court case than the first class action suit in Poland. Entrepreneurs who lost their assets as a result of flooding versus the state which failed to look after the flood banks and did not warn its citizens of the impending danger in time. The motion is to be filed this week. The demands amount to several million PLN.
The class action will facilitate the pursuit of claims in cases even from several years ago. The victims of the collapse of the Katowice trade fair hall will be the first to file a suit. In the US, the most class actions are conducted against stock-exchange companies. The families of the Smoleńsk crash victims are also considering filing a class action. As “DGP” was informed by the proxy of the injured parties, Rafał Rogalski, it is yet too early to make a final decision. It is not known who the suit should be filed against or whether this would prove more advantageous than conducting separate cases.
The Polish economy is developing dynamically. It is an example of an economy in transition, in which structural changes have been effectively implemented since 1989. In order to free the market and promote competition Poland introduced legal regulations, a privatisation program, currency exchange market regulations, income tax breaks for enterprises and opened financial markets. Poland has also opened up to foreign greenfield investment.
Ten injured parties suffice to start a class action suit. Passengers will be able to jointly demand compensation for cancelled train connections. 60% of companies think that class action suits will remain without influence on their operations.
Additional pensions will be paid against mortgage-secured loans (so-called reverse mortgage). Not everyone, however, will obtain such a loan. Banks will verify the applicant’s creditworthiness. If someone’s debt is too high, they will have to forget about the additional pension. In the event the loan is granted, they will be faced with the real estate insurance expenses which, in keeping with the provisions of the act, is to be mandatory.
A consumer who concluded a remote agreement and destroyed or damaged the purchased item, is obligated to return the unjust enrichment. In the case of the consumer remote sales, i.e. for example in an online shop, or sales outside the company’s seat, e.g. from a canvasser, the consumer is entitled to withdraw from the sale agreement. Consumers can do so within the 10-day-period and they are not obligated to provide the cause of their withdrawal from the transaction. In the case of remote sales, the said period runs from the date of the delivery of the item whereas in the case of sales outside the company’s seat, from the day of the conclusion of the agreement.
The Polish Government intends to privatise 802 State Treasury companies from various economic sectors between 2008 and 2011. For this purpose, the Ministry of Treasury has prepared the “Privatisation plan for the years 2008 – 2011”, which was adopted by the Council of Ministers in April 2008 and further updated in early 2010. The Privatisation plan also provides for the sale of 54 companies viewed as strategic from the perspective of the Polish economy that are to be privatised between 2009 and 2010, with 15 companies undergoing the process by the end of 2009 and 39 companies by the end of 2010…
The Ministry of Justice wants to speed up the course of hearings before courts. With that in view, court proceedings will no longer be recorded on paper, but videoed. Court hearings are to be recorded in the audio-visual format. Such amendments to the Code of Civil Procedure come as the Ministry’s of Justice bid at modernising court procedures.
What trends are you expecting to see in international business law in the coming year? “I don’t think we will see many new trends this coming year. We will continue to observe the efforts of governments and parliaments to overcome the world economic crisis, as, despite the fact that it has been ongoing for some time now, new issues continue to emerge. These are significantly hampering the forecasting and neutralisation of threats.”
The closer the date of admitting class action suits in pursuit of claims, the less enthusiastic the opinions of this instrument. Practice will surely verify this. Yesterday, the editor office of “Rzeczpospolita” daily provided the venue for an expert discussion on the strengths and weaknesses of this institution, new to the Polish law.
Three questions for Rafał Kos, a partner of the Kubas, Kos, Gaertner Law Firm – So far class action suits in Europe, contrary to opinions of many sceptics, have not turned out to be a tool for legal blackmail used against entrepreneurs. The conducted research has not demonstrated that they resulted in a drop in the number and scale of foreign investments in other countries.
President Lech Kaczyński’s proxy seeks the rejection of Lech Wałęsa’s statement of claims for the apology and payment of PLN 100 thousand for the head of the state’s reference to his person as to the SB [Secret Service] agent code-named Bolek. Wałęsa’s proxy deems the motion to be aimed at protracting the proceedings which commenced today. The trial was adjourned until December 18th.
The new institution may not only change the system of administration of justice, but also the legal services market, thus providing law firms with an opportunity for new earnings. The [newly-]passed Act on the pursuit of claims in class action suits will introduce the possibility of the joint pursuit of compensation. The Act’s provisions may provide a weapon for consumers involved in a struggle against manufacturers of defective products or small shareholders injured by companies.
An important amendment of the Polish Commercial Companies Code was introduced on 1st August 2009 regarding the rights of stockholders of public companies. Particularly important for foreign stockholders of Polish public companies is the new possibility of participating in annual general meetings through electronic communication means and possession of the right vote through a proxy.
Within the worst of a recession, predicted to be over and the grass snoots of many economies re emerging. ACQ talks to the expert about emerging from a downturn. ACQ talks to Mr. Dominik Gałkowski a partner at Kubas, Kos, Gaertner about how Poland emerged from a downturn.
The prolixity of broadly understood court or preparatory proceedings is an unfortunate affliction of the Polish justice system with an adverse effect on the way the entire State is perceived. The said prolixity is a feature, which after many years of neglect the Polish legislator is attempting to combat on numerous fronts starting from the reorganisation of the courts and prosecutor offices through numerous complex changes to the provisions regulating the proceedings.
Information on arrears in payment of amounts due resulting from agreements concluded with banks is protected by bank secrecy under which, as regards the principle, the bank is unable to disclose any such information to any third parties without the consent of the secrecy’s beneficiary. However, in specific situations, the safety of economic transactions requires that access to such data is granted to a wider circle of entities.
Polish case law has made a significant turn as regards the assessment of premises, from which the possibility to call make managerial staff liable towards the company by a company dissatisfied with the quality of the exercised management depends on. What was the standard mechanism operating up to now? For a company to hold a manager liable, such a manager must have acted in an unlawful way, i.e. they must have breached their specific duties resultant from the provisions of the act or the company’s articles of association.
A pledge on rights from securities, and in particular on dematerialised securities functioning in the form of records on suitable accounts kept by investment companies constitutes one of the most popular collateral on liabilities in the banking practice.
Since 1st July 2009, new principles for the recognition of judgements of foreign state have come into force. The introduced changes are undoubtedly of a fundamental character. Hitherto, as regards the principle, a foreign court judgement acquired the force of law equal to a Polish court judgement only upon being recognised in a final manner. This required Polish courts to issue a decision after conducting special proceedings on the recognition of a foreign court judgement.
It is a frequent occurrence that liabilities acquired by banks as part of factoring are insured against the risk of the debtor’s failure to satisfy them. A bank financing a factoring agent often also wants the factoring agent, as means of securing the bank’s liabilities resulting from the factoring agreement, to transfer onto the bank also liabilities for the payment of an insurance performance resulting from such insurance.
A legislative tendency to increasingly apply modern technologies in civil proceedings has recently been observed. The latest solution favouring broader computerisation of civil proceedings concerns the introduction of electronic writ-of-payment proceedings. These provisions shall take effect as of 1st January 2010.
Both the bank as well as its clients ought to bear in mind the restrictions which the provisions providing for the protection of bank secrecy introduce in the scope of transfer by banks of claims resultant from banking operations.
Professional proxies and entrepreneurs have welcomed with relief another verdict of the Constitutional Tribunal “standardising” the level of formalism in civil proceedings in commercial cases.
When attempting to obtain from a counterparty, a collateral of a claim in the form of a bank guarantee, it should be taken into consideration whether this guarantee is to be a transferrable one, i.e. a guarantee the claims from which are subject to transfer onto another entity and which possible entities such a transfer could be made to.
In face of the present tendency to tighten civil procedure provisions, it is worth recalling the regulation contained in Article 162 of the CCP. Although it is not a new provision, over the recent years, the courts have been more and more frequently resorting to this “device” for an easy dismissal of claims raised by parties in appeals and complaints. Hence, it is not only worthwhile but virtually indispensable to bear this regulation in mind.
Year 2008, despite the onset of the crisis, was successful for our office. The established brand, confirmed in practice in annual rankings both in Poland as well as abroad, comes as an effect of the constant development, appropriate strategy and effective and honest co-operation with our clients.
In practice, in a situation when a bank gives a loan for the purchase of shares in a limited liability company, the same bank frequently requires that the borrowing party establishes a collateral on their claims on acquired shares which frequently is a collateral of a basic character.
On 5th December 2008, the Sejm passed another Act systematically modifying the Code of Civil Procedure. In the mentioned act, the legislator continues the reform of Part IV of the Code of Civil Procedure related to international civil proceedings and enroots in the Code the regulations to be found in the regulations of the European Parliament and Council.
On 24th January 2009, an amendment of the provision of Article 358 of the Civil Code came into force. Prior to that date, the mentioned provision introduced the rule that with the reservation of statutory exceptions, pecuniary liabilities on the territory of the Republic of Poland could be expressed exclusively in the Polish currency. From the present contents of this provision it follows that it is admissible to specify liabilities in foreign currency.
In the decision of 17th October 2008 (file ref. no. I CSK 552/07), the Supreme Court stated that the plaintiff may abandon a statement of claims at the defendant’s consent at any stage of the case – also in the course of cassation proceedings before the Supreme Court. In the case in which the decision above was issued, one of the parties lodged a cassation complaint against the judgement of a court of second instance.
Polish case law has made a significant turn as regards the assessment of premises, from which the possibility to call make managerial staff liable towards the company by a company dissatisfied with the quality of the exercised management depends on. What was the standard mechanism operating up to now? For a company to hold a manager liable, such a manager must have acted in an unlawful way, i.e. they must have breached their specific duties resultant from the provisions of the act or the company’s articles of association.
As of 17th October 2005 (since the coming into force of an amendment to the Code of Civil Procedure), the Act provides for the possibility to secure claims pursued before a Polish court of arbitration both by a common court of law (Article 1166 of the CCP) as well as by a court of arbitration (Article 1181 of the CCP), whereby the parties to the arbitration may deprive the court of arbitration of the competence to adjudicate on the injunction.
The most fundamental amendments to the act on registered pledges which came into force on 11th January 2009 shall be presented below. The amendment abolishes a one month period for the submission of an application for entry of a pledge in the register. In case when the pledger, pledgee, or the debtor’s permanent residence (registered seat) is located outside of Poland, the address for service in Poland is also provided in the application.
Poland’s lack of exposure to the sub prime market means that the current global financial crisis bears only a limited influence on the economic situation in Poland as banks do not possess a portfolio of bad credits that could threaten their liquidity. In accordance with the published data, the banking sector in Poland is characterised by a surplus of deposits over credits. Furthermore, banks operate as joint-stock companies, which limits the influence of potential problems of foreign owners on the situation of their Polish subsidiaries.
On 5th September 2008, an amendment to the act on registered pledges and the pledge register as well as on the amendment of other acts was passed to come into force on 11th January 2009 (“Amendment”). The amendment removes a number of previous doubts as well as modernises the over 10-year old institution of the pledge register adjusting it to modern practice needs. Further two papers shall present the most fundamental amendments to the act on registered pledges.…
For entrepreneurs submitting disputes for settlement by courts of arbitration, extremely important issues arise on the border of the arbitration proceedings and the bankruptcy law. These issues are visible in the specification of the effects which a bankruptcy of one of the parties to the dispute has for arbitral awards issued still prior to the declaration of bankruptcy.
In banking, a pledge on rights from securities is one of the more popular methods of securing claims. Presently, due to the financial market’s constant development, a pledge on dematerialised securities, existing in the form of records on appropriate accounts (registers), is of substantial significance.
In practice, securing of a claim in the form of a registered pledge on a creditor’s machinery and equipment, production hall furnishings, or stock inventory is popular. In light of the Act on Registered Pledge and Pledge Register, it is a pledge on a collection of items designated as regards their type or on a collection of movables constituting an economic whole even should its composition be variable (The Act, Article 7. 2.2 and 3).
Proverbs that where there is no pain there is no gain. The same source provides us with another adage, namely that if you sow wind you reap the whirlwind. These two proverbs carrying a universal message also aptly present a key aspect of the issue of substantive law liability of management board members for their actions related to the discharge of a function within the frames of a company’s body: since on one hand, managers are obligated to multiply company’s assets which sometimes requires taking economic risks while on the other, their actions may not be entirely random and arbitrary and exempt from any verification whatsoever as regards their legality.
A conclusion may be derived from Article 207 of the Commercial Companies Code that members of limited liability company’s management board are under the obligation to execute resolutions of shareholders containing instructions related to the conducting of company’s affairs insofar as the company’s formation deed does not provide otherwise. The correctness of this thesis is unequivocally confirmed by the provision of Article 219.2 of the Commercial Companies Code which contrary to the rules appropriate for the joint-stock company (Article 3751 of the Commercial Companies Code) addresses a ban on giving instructions in the scope of a limited liability company management only to the supervisory board without referring it to the meeting of shareholders.
Confidentiality is the foundation of arbitration. Its objective is to ensure the speed of the proceedings, protection of trade secrets and good names of parties and to curtail the risk of another dispute arising. The said principle has been created along with the development of arbitration which, however, pertained to private disputes. Presently, also the State happens to appear as a party in arbitration proceedings; it is particularly visible in the event of cases related to bilateral investment treaties (BIT)
Many banks offer products called “an escrow account”. No regulation uses this term. In practice, it is a bank account usually set up on the basis of a trilateral agreement – most often concluded between a seller, a buyer, and a bank, for the needs of settlement of accounts as part of a sale agreement.
The professional ethics code prohibits the advertising of law firm services. However, information on provided legal assistance is admissible. Lawyers are reluctant to publish their operation-related data, and the data related to revenues of law firms in particular.
The use of Polish law by courts of arbitration is not mandatory since the basis for their operation is the agreement between parties, therefore, it is precisely the parties who decide on the grounds of which provisions their affairs should be settled. However, the freedom given to courts of arbitration is not absolute since its limits are established by the public policy clause.
The Sejm is presently looking at two bills on the amendment of the act on the land and mortgage registers and mortgage (http://orka.sejm.gov.pl/projustall6.html). Their prompt introduction has already been decided in practice. Therefore, they are worth taking a look at now in order to be able to make suitable preparations related to them. Future changes of the highest significance for the practice shall be presented below.
In setting aside awards of courts of arbitration, state courts present legal opinions and guidelines pointing out the errors made by the courts of arbitration. Nonetheless, neither the law in force nor the case-law of the Supreme Court provide a direct answer to the fundamental question whether the guidelines of state courts are binding for courts of arbitration.
The Sejm is presently looking at two bills on the amendment of the act on the land and mortgage registers and mortgage (http://orka.sejm.gov.pl/projustall6.html). Both projects enjoy the support of the government and the opposition, therefore, their prompt introduction seems to have already been decided. Therefore, they are worth taking a look at now in order to be able to make suitable preparations related to them.
Companies today are increasingly realising the financial benefits of establishing operations outside their own country and the growing use of setting up a foreign /offshore holding company for tax purposes.
Stretching from the Baltics in the North to the Balkans in the South, the Central and Eastern European region spans a vast geographical area. Although the term CEE provides a convenient shorthand to describe the former Communist states that fall between western Europe and Russia, it overlooks the fact that the countries that make up the region di!er dramatically in terms of culture as well as economic makeup. One uniting factor however is the economic restructuring and mass privatization wave that has taken place, to a greater or lesser extent, in each country since the early 1990s.
The fundamental task of management board members is the due discharge of the tasks they have been entrusted. However, many a time it so happens that through their actions they may inflict damage to the company itself or to its counterparties or creditors. This incurs a threat of a dismissal from the function held as well as being held accountable for their actions.
Looking for possibilities of development, Polish entrepreneurs are more and more often interested in foreign markets. A conclusion of a trade agreement with a counterparty from another country is, however, very time-consuming and encounters multiple obstacles. It can be avoided by making use of so-called soft law, i.e. a collection of quasi-legal standards.
One of the most fundamental decisions to be made by each entrepreneur concerns the legal form of conducted business activity. Until only recently, the choice was only between private and capital companies. Nowadays, the choice is a lot wider – Polish entrepreneurs may recourse to modern, complex legal forms which allow risks to be minimised and profits to be increased.