In the twenty-eight years since Poland discarded communism and the fourteen years since it joined the European Union (EU), Poland’s investment climate has continued to grow in attractiveness to foreign investors, including U.S. investors. Poland’s economy has experienced a long period of uninterrupted economic expansion since 1992. In 2017, Poland’s economy gained momentum as consumption continued to grow and spending of EU funds accelerated public investment. However, some controversial economic legislation dampened optimism in some sectors (e.g. retail, renewable energy, healthcare), and investors have pointed to the outsized role of state-owned and state-controlled companies in the Polish economy as an impediment to dynamic growth. There have been allegations of the government favoring state-owned or state-controlled companies in sectors it views as strategic.
Prospects for future growth, driven by domestic demand and inflows of EU funds from the 2014-2020 financial framework, will likely continue to attract investors seeking access to Poland’s dynamic market of over 38 million people, and to the broader EU market of nearly 500 million. Poland’s well-diversified economy reduces its vulnerability to external shocks, though it depends heavily on the EU as an export market. Foreign investors also cite Poland’s well-educated work force and competitive wages as a major reason to invest, as well as its proximity to major markets such as Germany.
U.S. firms represent one of the largest groups of foreign investors in Poland. The volume of U.S. investment in Poland is estimated at USD 11.6 billion, although including indirect investment flows through subsidiaries may place it as high as USD 43 billion, according to the American Chamber of Commerce in Poland. Historically FDI was largest in the automotive and food processing industries, followed by machinery and other metal products and petrochemicals. However, “back office” services such as accounting, legal, and information technology services, including research and development (R&D), are Poland’s fastest-growing sectors. The government seeks to promote domestic production and technology transfer opportunities in awarding military tenders. There are also some investment and export opportunities in the energy sector (nuclear and natural gas) as Poland seeks to diversify its energy mix and reduce air pollution. Defense is another promising sector for U.S. exports, as Poland will spend between USD 35-45 billion through 2022 on military modernization, including the signing in March 2018 of the first phase for the purchase of a Patriot missile defense system. Information technology and infrastructure also show promise, as Poland’s municipalities focus on smart city networks.
The government seeks to expand the economy by supporting high-tech investments, increasing productivity and foreign trade, and supporting entrepreneurship, scientific research, and innovation through the use of domestic and EU funding. Recent legislation increased tax benefits for entrepreneurs investing in R&D and innovation.
Some organizations, notably private business associations and labor unions, have raised concerns that policy changes have been introduced quickly and without broad consultation, increasing uncertainty about the stability and predictability of Poland’s business environment. Some examples include the recently introduced ban on Sunday trade; abolishment of the earnings cap for paying pension and disability contributions; legislation restricting ownership of pharmacies; and hospital reform favoring large public networks. Laws passed in 2016 regulating wind farm construction caused sharp valuation drops in wind energy sector assets–more than half of which are owned by foreign investors—and curbed new investments in wind energy infrastructure.
The Polish tax system underwent many changes in 2016 and 2017 with the aim of increasing budget revenues, including more aggressive tax auditing and collection. Significant reforms to Poland’s Corporate Income Tax law became effective January, 1, 2018, and include substantial changes to taxpayer’s required transfer pricing documentation. The new rules, effective January 1, 2017, reflect harmonization with EU directives. Country- by- country (CBC) reporting obligations started in 2016. Some U.S. investors have expressed concern that Poland’s tax authorities do not always consistently uphold presumably binding tax decisions, sometimes seeking retroactive payments after a reversal.
As the largest recipient of EU funds (which contribute an average 1 percent to Poland’s GDP per year), any significant decrease in EU cohesion spending, potentially caused by BREXIT or strict rule-of-law conditionality in future EU perspectives, would have a large negative impact on Poland’s economy. As such, observers are closely watching the European Commission’s proceedings under Article 7 of the Lisbon Treaty, initiated in December 2017, regarding rule of law and judicial reforms. These include the introduction of an extraordinary appeal mechanism in the recently enacted Supreme Court Law, which could potentially affect economic interests, in that final judgments issued since 1997 can now be challenged and overturned in whole or in part, including some long-standing judgments on which economic actors have relied.
|TI Corruption Perceptions Index||2018||36 of 180||http://www.transparency.org/
|World Bank’s Doing Business Report “Ease of Doing Business”||2017||27 of 190||http://www.doingbusiness.org/rankings|
|Global Innovation Index||2017||42 of 128||https://www.globalinnovationindex.org/
|U.S. FDI in partner country (M USD, stock positions)||2016||USD 11,600||http://www.bea.gov/
|World Bank GNI per capita||2016||USD 12,680||http://data.worldbank.org/
1. Openness To, and Restrictions Upon, Foreign Investment
Policies Towards Foreign Direct Investment
Poland welcomes foreign investment as a source of capital, growth, and jobs, and as a vehicle for technology transfer, research and development (R&D), and integration into global supply chains. The government’s Strategy for Responsible Development identifies key goals for attracting investment, including improving the investment climate, a stable macroeconomic and regulatory environment, and high quality corporate governance, including in state-owned companies. By the end of 2016, according to IMF and National Bank of Poland data, Poland attracted over USD 185 billion (cumulative) in foreign direct investment (FDI), principally from Western Europe and the United States. In 2016, reinvested profits dominated the net inflow of FDI to Poland. The greatest reinvestment of profits occurred in manufacturing. For the first time NBP included in its report for 2016 a completely new category – FDI in innovative industries.
Foreign companies generally enjoy unrestricted access to the Polish market. However, Polish law limits foreign ownership of companies in selected strategic sectors, and limits acquisition of real estate, especially agricultural and forest land. Additionally, the current government has expressed a desire to increase the percentage of domestic ownership in some industries such as banking and retail which have large holdings by foreign companies, and has employed sectoral taxes to advance this aim. Two new laws in the healthcare sector have been alleged to discriminate against foreign firms, namely hospital reform favoring large public hospitals for public reimbursement contracts, and a law introduced in 2017 aimed at restricting ownership of pharmacies to licensed pharmacists in an effort to force out pharmacy chains. In March 2018, Sunday trade ban legislation went into effect, which will gradually phase out Sunday retail commerce in Poland. There are concerns the restrictions will be expanded to include logistics centers and warehousing in the future based on the original draft of the bill.
There are a variety of Polish agencies involved in investment promotion:
- The Entrepreneurship and Technology Ministry has two departments involved in investment promotion and facilitation: the Investment Development and the Trade and International Relations Departments .
- The Foreign Affairs Ministry (MFA) promotes Poland’s foreign relations including economic relations , and along with the Polish Chamber of Commerce (KIG), organizes missions of Polish firms abroad and hosts foreign trade missions to Poland .
- In February 2017, the Polish Investment and Trade Agency (PAIH) replaced the Polish Information and Foreign Investment Agency (PAIiIZ) as the main institution responsible for promotion and facilitation of foreign investment. The agency is responsible for promoting Polish exports, for inward foreign investment and for Polish investments abroad. The agency operates as part of the Polish Development Fund, which integrates government development agencies. PAIH coordinates all operational instruments, such as commercial diplomatic missions, commercial fairs and programs dedicated to specific markets and sectors. The Agency has opened offices abroad including in the United States (San Francisco and Washington D.C.) with plans to open additional locations possibly in Los Angeles, Chicago and New York. PAIH’s services are available to all investors. .
- In April 2018, the Polish government announced the formation of the Polish Chamber of Commerce in the United States, which will be based in Washington, D.C. While still organizing its operations, the chamber will encourage U.S. investment in Poland and advocate for Polish investors in the United States. .
The Polish Investment and Trade Agency (PAIH) also serves as an ombudsman for foreign investors. Also the Ministry of Entrepreneurship and Technology invites investors, including foreign ones, to discuss issues of general concern and/or related to a particular sector of Poland’s economy.
Limits on Foreign Control and Right to Private Ownership and Establishment
Poland allows both foreign and domestic entities to establish and own business enterprises and engage in most forms of remunerative activity per the Entrepreneurs’ Law which went into effect on April 30, 2018. Forms of business activity are described in the Commercial Companies Code. Poland does place limits on foreign ownership and foreign equity for a limited number of sectors. Polish law limits non-EU citizens to 49 percent ownership of a company’s capital shares in the air transport, radio and television broadcasting, and airport and seaport operations sectors. Licenses and concessions for defense production and management of seaports are granted on the basis of national treatment for investors from OECD countries.
Pursuant to the Broadcasting Law, a television broadcasting company may only receive a license if the voting share of foreign owners does not exceed 49 percent and if the majority of the members of the management and supervisory boards are Polish citizens and hold permanent residence in Poland. In January 2017, a team comprised of officials of the Ministry of Culture and National Heritage, the National Broadcasting Council (KRRiT) and the Office of Competition and Consumer Protection (UOKiK) was created in order to review and tighten restrictions on large media, and limit foreign ownership of the media. While no legislation has been introduced, there is concern that future proposals may limit foreign ownership in the media sector.
In the insurance sector, at least two management board members, including the chair, must speak Polish. The Law on Freedom of Economic Activity (LFEA) requires companies to obtain government concessions, licenses, or permits to conduct business in certain sectors, such as broadcasting, aviation, energy, weapons/military equipment, mining, and private security services. The LFEA also requires a permit from the Ministry of Entrepreneurship and Technology for certain major capital transactions (i.e., to establish a company when a wholly or partially Polish-owned enterprise has contributed in-kind to a company with foreign ownership by incorporating liabilities in equity, contributing assets, receivables, etc.). A detailed description of business activities that require concessions and licenses can be found here: .
Polish law restricts foreign investment in certain land and real estate. Land usage types such as technology and industrial parks, business and logistic centers, transport, housing plots, farmland in special economic zones, household gardens and plots up to two hectares are exempt from agricultural land purchase restrictions. Citizens from countries other than the EU, Iceland, Liechtenstein, Norway, and Switzerland are allowed to purchase an apartment, 0.4 hectares (4,000 square meters) of urban land without restriction, or up to one-half hectare of agricultural land with building restrictions and restrictions on eligibility for government support programs. However, in order to make large commercial real estate purchases, foreign citizens must obtain a permit from the Ministry of Interior (with the consent of the Defense and Agriculture Ministries), pursuant to the Act on Acquisition of Real Estate by Foreigners. A foreign business intending to buy real estate in Poland may apply for a provisional permit from the Ministry of Interior, which is valid for two years from the date of issue, during which time the company is expected to assemble documents demonstrating it is a viable business. Permits may be refused for reasons of social policy or public security. Laws to restrict farmland and forest purchases came into force April 30, 2016 and are addressed in more detail in Section 6: Real Property.
Since Poland’s EU accession in 2004, foreign citizens from EU member states, Iceland, Liechtenstein, Norway, and Switzerland do not need permission to purchase non-agricultural real estate, or to acquire or receive shares in a company owning non-agricultural real estate in Poland.
Since September 2015 the Act on the Control of Certain Investments has provided for the national security-related screening of acquisitions in high-risk sectors including: energy generation and distribution; petroleum production, processing and distribution; telecommunications; media and mining; and manufacturing and trade of explosives, weapons and ammunition. Poland maintains a list of strategic companies that can be amended at any time. The national security review mechanism does not appear to constitute a de facto barrier for investment, and does not unduly target U.S. investment. According to the Act, prior to the acquisition of shares of strategic companies (including the acquisition of proprietary interests in entities and/or their enterprises) the purchaser must notify the controlling government body and receive approval. The obligation to inform the controlling government body applies to transactions involving the acquisition of a “material stake” in companies subject to special protection. The Act stipulates that failure to notify carries a fine of up to PLN 100,000,000 (+/- USD 25,575,542) or a penalty of imprisonment between six months and five years (or both penalties together) for a person acting on behalf of a legal person or organizational unit that acquires a material stake without prior notification.
Other Investment Policy Reviews
In March 2018 the OECD published a Rural Policy Review on Poland. According to this review, Poland has seen impressive growth in recent years, and yet regional disparities in economic and social outcomes remain large by OECD standards. The review is available at: .
The Polish government has continued to implement reforms aimed at improving the investment climate with a special focus on the SME sector and innovations. The so-called “small law” on innovation entered into force January 1, 2017, and the “big law” on innovation came into force in January 2018. Please see section 5 of this report for more information.
A package of five laws referred to as the “Business Constitution”—intended to facilitate the operation of small domestic enterprises—is expected to become effective in May 2018. The Acts were drafted over the past two years and are meant to facilitate companies’ ability to conduct business. The main principle of the Business Constitution is the presumption of innocence of business owners in dealings with the government. Additionally, the process of obtaining a building permit has been streamlined.
Despite these reforms and others, investors have expressed serious concerns regarding over-regulation, over-burdened courts and prosecutors, and overly-burdensome bureaucratic processes. To improve effectiveness, the customs and tax administrations were merged into one body—the National Revenue Administration—which became operational in 2017. The way tax audits are performed has changed considerably. For instance, in many cases the appeal against the findings of an audit now must be lodged with the authority that issued the initial finding rather than a higher authority or third party.
In Poland, business activity may be conducted in forms of a sole proprietor, civil law partnership, as well as commercial partnerships and companies regulated in provisions of the Commercial Partnerships and Companies Code. Sole proprietor and civil law partnerships are registered in the Central Registration and Information on Business (CEIDG), which is housed by the Ministry of Entrepreneurship and Technology: .
Commercial companies are classified as partnerships (registered partnership, professional partnership, limited partnership, and limited joint-stock partnership) and companies (limited liability company and joint-stock company). A partnership or company is registered in the National Court Register (KRS) and kept by the competent district court for the registered office of the established partnership or company. Local corporate lawyers report that starting a business remains costly in terms of time and money, though KRS registration in the National Court Register averages less than two weeks according to the Ministry of Justice and four weeks according to the World Bank’s 2018 Doing Business Report.
Polish lawmakers are gradually digitalizing the services of the National Court Register (KRS). The first change, which entered into force on March 15, 2018, was the obligation to file financial statements with the Repository of Financial Documents via the Ministry of Finance website. There is also a new requirement for representatives and shareholders of companies to submit statements on their addresses. A requirement to file financial statements exclusively in electronic form will enter into force on October 1, 2018, and from March 2020, all applications will have to be filed with the commercial register electronically.
- General information, National Court Register (KRS): ;
- Forms in English, National Court Register (KRS): ;
- Electronic KRS access: .
Forms and Agencies a business will need to file with in order to register in the KRS:
- Central Statistical Office:
(Note: this registration will not be required after passage of the Constitution for Business);
- ZUS – Social Insurance Agency:
- Ministry of Finance:
Both registers are available in English and foreign companies may use them.
According to the accounting firm Pricewaterhouse Coopers (PWC)’s Women in Work Index, Poland rose from 12th to 9th position from 2016 to 2017. In the ranking, Poland stands out for achieving the largest annual improvement among European countries, and is expected to converge the 6.8 percent gender pay gap within the next 20 years. The biggest challenge is increasing the number of women on company boards – currently at 11 percent.
The Polish Agency for Investment and Trade (PAIH) under the umbrella of the Polish Development Fund, plays a key role in promoting Polish investment abroad. More information on PFR can be found in section 7 and at its website: .
The Minister of Foreign Affairs and the Minister of Entrepreneurship and Technology are carrying out a reform of Poland’s economic diplomacy. The Polish Information and Foreign Investment Agency (PAIiIZ) was rebranded in February 2017 to Polish Agency for Investment and Trade (PAIH); existing Trade and Investment Promotion Sections in embassies and consulates around the world are being replaced by PAIH offices and new PAIH offices are being established (San Francisco, Los Angeles and Washington, D.C.) with a goal of 70 PAIH offices worldwide.
PAIH offices offer a range of services to include: finding potential partners for Polish manufacturers/exporters; providing information on business opportunities; assisting in the organization of business trips and study tours; and assisting in initiating first contacts between interested local importers, distributors or wholesalers and Polish manufacturers or service providers. PAIH has a number of investment/export-oriented government programs specially developed to promote Polish companies abroad such as Go China, Go India, Go Africa or Go Arctic. Poland aspires to become a logistics hub for Chinese goods in Western Europe and actively supports the One Belt One Road initiative. Poland is a founding member of the Asian Infrastructure Investment Bank (AIIB). Vietnam and Iran are also priority investment and export destinations for Poland.
The national development bank BGK (Bank Gospodarstwa Krajowego) offers support for goods with a Polish component and depending on the credit can be a minimum of 30-40 percent of net contract revenue. BGK offers a number of short-term credit instruments like documentary letters of credit for post-financing. BGK offers direct credit for importers to purchase investment goods and services. KUKE insures the BGK-issued credit, including for companies from countries with higher trade risk.
2. Bilateral Investment Agreements and Taxation Treaties
Poland has concluded bilateral investment agreements with the following countries: Albania (1993); Argentina (1992); Australia (1992); Austria (1989); Azerbaijan (1999); Bangladesh (1999); Belgium and Luxembourg (1991); Belarus (1993); Bulgaria (1995); Canada (1990); Chile (2000); China (1989); Croatia (1995); Cyprus (1993); the Czech Republic (1994); Denmark (1990); Egypt (1998); Estonia (1993); Finland (1998); France (1990); Germany (1990); Greece (1995); Hungary (1995); India (1997 – terminated its treaty w/Poland; a 15 year sunset clause applies); Indonesia (1993); Iran (2001; although Poland supports international sanctions regimes); Israel (1992); Jordan; Kazakhstan (1995); Kuwait (1993); Latvia (1993); Lithuania (1993); Macedonia (1997); Malaysia (1994); Moldova (1995); Mongolia (1996); Morocco (1995); the Netherlands (1994); Norway (1990); Portugal (1993); Romania (1995); Serbia and Montenegro (1997); Singapore (1993); Slovenia (2000); Slovakia (1996); South Korea (1990); Spain (1993); Sweden (1990); Switzerland (1990); Thailand (1993); Tunisia (1993); Turkey (1994); Ukraine (1993); United Arab Emirates (1994); the United Kingdom (1988); the United States (1994); Uruguay (1994); Uzbekistan (1995); Vietnam (1994).
The United States and Poland signed a Treaty Concerning Business and Economic Relations in 1990 that was amended and ratified in October 2004. A current list of all Poland’s BITs, including the documents themselves, can be found at: .
In February 2016, Poland’s government announced its intention to terminate intra-EU bilateral investment treaties (BITs) as requested by the European Commission. As of March 2018, Poland had unilaterally terminated BITs with Portugal and France; a list of termination projects with other EU members awaits approval by Poland’s Lower House of Parliament. The March 6, 2018 European Court of Justice (ECJ) decision on the Slovak Republic v. Achmea case underscored the Commission’s position that arbitration clauses in BITs are not compliant with EU law; this development should support Poland’s efforts to move forward with terminations.
Bilateral Taxation Treaties
Poland has signed Double Tax Treaties with over 80 countries. The United States shares a double taxation treaty with Poland; an updated bilateral tax treaty was signed in February 2013 and is awaiting U.S. ratification. The Agreement between the United States of America and the Republic of Poland on Social Security (“Totalization Treaty”) prevents double taxation, enables resumption of payments to suspended beneficiaries, and allows transfer of benefit eligibility.
In 2017, Poland’s Corporate Income Tax law underwent significant reform. The amendments became effective January, 1, 2018, and include the following key changes:
- New thin capitalization rules (also covering third-party financing);
- Disallowance of interest on debt-push-down strategies (leveraged buy-outs followed by tax consolidation of the acquirer with the target);
- Majority of royalties and service fees become non-deductible (restrictions go much further than the Organization for Economic Co-operation and Development Base Erosion and Profit Shifting recommendations);
- Introduction of income baskets;
- Minimum levy on certain commercial real estate;
- New controlled foreign company rules.
The reforms also include substantial changes to taxpayer’s required transfer pricing documentation. The new rules, effective January 1, 2017, reflect harmonization with EU directives. Country- by- country (CBC) reporting obligations started in 2016. Some U.S. investors have expressed concern that Poland’s tax authorities do not always consistently uphold presumably binding tax decisions, sometimes seeking retroactive payments after a reversal. The double taxation treaty does not cover stock options as part of remuneration packages, according to some investors.
3. Legal Regime
The Polish Constitution contains a number of provisions related to administrative law and procedures. It states administrative bodies have a duty to observe and comply with the law of Poland. The Code of Administrative Procedures (CAP) states rules and principles concerning participation and involvement of citizens in processes affecting them, the giving of reasons for decision, and forms of appeal and review.
As a member of the EU, Poland complies with EU directives by harmonizing rules or translating them into national legislation. Rule-making and regulatory authority exists at the central, regional, and municipal levels. Various ministries are engaged in rule-making that affects foreign business, such as pharmaceutical reimbursement at the Ministry of Health or incentives for R&D at the Ministry of Entrepreneurship and Technology. Regional and municipal level governments can levy certain taxes and affect foreign investors through permitting and zoning.
Polish accounting standards do not differ significantly from international standards. Major international accounting firms provide services in Poland. In cases where there is no national accounting standard, the appropriate International Accounting Standard may be applied. However, investors complain of regulatory unpredictability and high levels of administrative red tape. Foreign and domestic investors must comply with a variety of laws concerning taxation, labor practices, health and safety, and the environment. Complaints about these laws, especially the tax system, center on frequent changes, lack of clarity and strict penalties for minor errors.
Poland has substantially improved its regulatory policy system over the last years. The government introduced a central online system to provide access to the general public to regulatory impact assessment (RIA) and other documents sent for consultation to selected groups such as trade unions and business. Proposed laws and regulations are published in draft form for public comment, and ministries must conduct public consultations. Poland follows OECD recognized good regulatory practices, but investors say the lack of regulations governing the role of stakeholders in the legislative process is a problem. Participation in public consultations and the window for comments are often limited.
New guidelines for RIA, consultation and ex post evaluation were adopted under the Better Regulation Program in 2015, providing more detailed guidance and stronger emphasis on public consultation. Like many countries Poland faces challenges to fully implement its regulatory policy requirements and to ensure that RIA and consultation comments are used to improve decision making. The OECD suggests Poland extend its online public consultation system and consider using instruments such as green papers more systematically for early-stage consultation to identify options for addressing a policy problem, but considers steps taken to introduce ex post evaluation of regulations are encouraging.
Bills can be submitted to the parliament for debate as “citizen’s bills” if authors can collect 100,000 signatures. NGOs and private sector associations most often take advantage of this avenue. Parliamentary bills can also be submitted by a group of parliamentarians, a mechanism that bypasses public consultation and which both domestic and foreign investors have criticized. Changes to the government’s rules of procedure introduced in June 2016 reduced the requirements for RIA for preparations of new legislation.
Administrative authorities are subject to oversight by courts and other bodies (e.g., Supreme Audit Chamber – NIK), the Office of the Ombudsman, special commissions and agencies, inspectorates, the Prosecutor and parliamentary committees. Polish Parliamentary committees utilize a distinct system to examine and instruct ministries and administrative agency heads. Committees’ oversight of administrative matters consists of: reports on state budgets implementation and preparation of new budgets, citizens’ complaints, and reports from the external audit agency (NIK) reports. In addition, courts and prosecutors’ offices sometimes bring cases to parliament’s attention. The Ombudsman’s institution works relatively well in Poland. Polish citizens have a right to complain and to put forward grievances before administrative bodies.
International Regulatory Considerations
Since Poland’s EU accession (May 2004) Poland has been transposing European legislation and reforming its regulations in compliance with the EU system. Poland sometimes disagrees with EU regulations related to renewable energy and emissions due to its important domestic coal industry.
Poland participates in the process of creation of European norms. There is strong encouragement for non-governmental organizations, such as environmental and consumer groups, to actively participate in European standardization. In areas not covered by the European normalization the Polish Committee for Standardization (PKN) introduces norms identical with international norms i.e., PN-ISO i PN-IEC. PKN actively cooperates with international and European standards organizations and with standards bodies from other countries. PKN is a member-founder of International Organization for Standardization (ISO) and a member of International Electro-technical Commission (IEC) since 1923.
PKN also cooperates with ASTM International (American Society for Testing and Materials) (ASTM) International and the World Trade Organization’s WTO Agreement on Technical Barriers to Trade (WTO/TBT). Poland has been a member of WTO since 1 July 1, 1995 and was a member of GATT since 18 October 18, 1967. All EU member states are WTO members, as is the EU in its own right. While the member states coordinate their position in Brussels and Geneva, the European Commission alone speaks for the EU and its members in almost all WTO affairs. PKN runs the WTO/TBT National Information Point in order to apply the provisions of the Agreement on Technical Barriers to Trade with respect to information exchange concerning national standardization.
Legal System and Judicial Independence
The European Commission, the Council of Europe’s Venice Commission, and some legal observers have argued that recently enacted judiciary reform laws affecting the Common Courts, Supreme Court, and National Judiciary Council infringe judicial independence and could risk breaching European rule of law standards. Some observers have criticized in particular the introduction of an extraordinary appeal mechanism in the recently enacted Supreme Court Law, which they believe could affect economic interests, in that final judgments issued since 1997 could be challenged and overturned in whole or in part, including some long-standing judgments on which economic actors have relied.
In December 2017, the European Commission triggered a disciplinary proceeding under Article 7 of the Lisbon Treaty for what it considered “systemic threats” to the independence of the Polish courts. The key concerns focused on the Polish government’s ability to remove up to 40 percent of the Supreme Court’s judges and the justice minister’s power to discipline judges. Separately, the Commission has sought redress through the European Court of Justice. The government has countered that its reforms do not infringe judicial independence and are intended to make court operations more efficient and transparent.
The Polish legal system is code-based and prosecutorial. The main source of the country’s law is the Constitution of 1997. The legal system is a mix of Continental civil law (Napoleonic) and remnants of communist legal theory. Poland accepts the obligatory jurisdiction of the International Court of Justice (ICJ), but with reservations. In civil and commercial matters first instance courts sit in single-judge panels, while courts handling appeals sit in three-judge panels. District Courts (Sad Rejonowy) handle the majority of disputes in the first instance. When the value of a dispute exceeds a certain amount or the subject matter requires more expertise (such as in intellectual property right matters), Circuit Courts (Sad Okregowy) serve as first instance courts. Circuit Courts also handle appeals from District Court verdicts. Courts of Appeal (Sad Apelacyjny) handle appeals from verdicts of Circuit Courts as well as generally supervise the courts in their region.
The Polish judicial system generally upholds the sanctity of contracts. Foreign court judgements, under the Polish Civil Procedure Code and European Community regulation, can be recognized. However, there are many foreign court judgments which Polish courts do not accept or accept partially. One of the reasons for delays in the recognition of judgments of foreign courts is an insufficient number of judges with specialized expertise. Generally, foreign firms are wary of the slow and over-burdened Polish court system, preferring other means to defend their rights. Contracts involving foreign parties often include a clause specifying that disputes will be resolved in a third-country court or through offshore arbitration (More detail in section 4, Dispute Settlement)
Laws and Regulations on Foreign Direct Investment
Foreign nationals can expect to obtain impartial proceedings in legal matters. Polish is the official language and must be used in all legal proceedings. It is possible to obtain an interpreter. The basic legal framework for establishing and operating companies in Poland, including companies with foreign investors, is found in the Commercial Companies Code. The Code provides for establishment of joint-stock companies, limited liability companies, or partnerships (e.g., limited joint-stock partnerships, professional partnerships). These corporate forms are available to foreign investors who come from an EU or European Free Trade Area (EFTA) member state or from a country that offers reciprocity to Polish enterprises, including the United States.
With few exceptions, foreign investors are guaranteed national treatment. Companies that establish an EU subsidiary after May 1, 2004, and conduct, or plan to commence business operations in Poland must observe all EU regulations. However, in some cases they may not be able to benefit from all privileges afforded to EU companies. Foreign investors without permanent residence and the right to work in Poland may be restricted from participating in day-to-day operations of a company. Parties can freely determine the content of contracts within the limits of European contract law. All parties must agree on essential terms, including the price and the subject matter of the contract. Written agreements, although not always mandatory, may enable an investor to avoid future disputes. Civil Code is the law applicable to contracts.
Useful websites (in English) to help navigate laws, rules, procedures and reporting requirements for foreign investors:
- Polish Investment and Trade Agency:
- Polish Financial Supervision Authority (KNF):
- Office of Competition and Consumer Protection (UOKIK):
Competition and Anti-Trust Laws
Poland has a high level of nominal convergence with the EU on competition policy in accordance with Articles 101 and 102 of the Lisbon Treaty. Poland’s Office of Competition and Consumer Protection (UOKiK) is well within EU norms for structure and functioning, with the exception that the Prime Minister both appoints and dismisses the head of UOKiK. The Organization for Economic Cooperation and Development (OECD) has repeatedly recommended Poland reverse this 2006 policy which is not in keeping with OECD norms. All multinational companies must notify UOKiK of a proposed merger if any party to it has subsidiaries, distribution networks or permanent sales in Poland. UOKiK’s website: .
Examples of competition reviews can be found at:
The December 2016 Act on Counteracting the Unfair Use of Contractual Advantage in Trade of Agricultural and Food Products came into force July 12, 2017. The law confers additional powers on the President of UOKiK to investigate asymmetrical relationships between suppliers and buyers of agricultural and food products. The April 2017 Act on Claims for Compensation for Damage Caused by Infringement of Competition Law facilitates obtaining compensation for infringement of competition law.
Expropriation and Compensation
Article 21 of the Polish Constitution states: “expropriation is admissible only for public purposes and upon equitable compensation.” The Law on Land Management and Expropriation of Real Estate provides property may be expropriated only in accordance with statutory provisions such as construction of public works, national security considerations, or other specified cases of public interest. The government must pay full compensation at market value for expropriated property. Acquiring land for road construction investment has been liberalized and simplified to accelerate property acquisition. Most acquisitions for road construction are resolved without problems. However, there have been a few cases in which inability to reach agreement on remuneration has resulted in disputes. Post is not aware of any recent expropriation actions against U.S. investors, companies, or representatives.
ICSID Convention and New York Convention
Poland is not a party to the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (Washington Convention). Poland is a party to the convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958 New York Convention);
Investor-State Dispute Settlement
Poland is party to the following international agreements on dispute resolution, with the Ministry of Finance acting as the government’s representative: The 1923 Geneva Protocol on Arbitration Clauses; The 1961 Geneva European Convention on International Trade Arbitration; The 1972 Moscow Convention on Arbitration Resolution of Civil Law Disputes in Economic and Scientific Cooperation Claims under the U.S.-Poland Bilateral Investment Treaty (BIT) (with further amendments).
Post is aware of seven U.S. investment disputes (eight claimants) within the past 10 years. Some details of past disputes may be found at this . The majority of Poland’s investment disputes are with other EU member states. According to the UNCTAD database, over the last decade, there have been some 14 known disputes with other foreign investors.
There is no distinction in law between domestic and international arbitration. The law only distinguishes between foreign and domestic arbitral awards for the purpose of their recognition and enforcement. The decisions of arbitration entities are not automatically enforceable in Poland, but must be confirmed and upheld in a Polish court. Under Polish Civil Code, local courts accept and enforce the judgments of foreign courts, however, in practice; the acceptance of foreign court decisions varies. Investors say the timely process of energy policy consolidation has made the legal, regulatory and investment environment for the energy sector uncertain in terms of how the Polish judicial system deals with questions and disputes around energy investments by foreign investors, and in foreign investor interactions with state owned or affiliated energy enterprises.
A Civil Procedures Code amendment in January 2016 implements internationally recognized arbitration standards, and creates an arbitration-friendly legal regime in Poland. The amendment applies to arbitral proceedings initiated on or after January 1, 2016, and introduced one-instance proceedings to repeal an arbitration award (instead of two-instance proceedings). This change encourages mediation and arbitration to solve commercial disputes and aims to strengthen expeditious procedure. The Courts of Appeal (instead of District Courts) handle complaints. In cases of foreign arbitral awards, the court of appeal is the only instance. In certain cases it is possible to file a cassation (or extraordinary) appeal with the Supreme Court of the Republic of Poland. In the case of a domestic arbitral award, it will be possible to file an appeal to a different panel of the court of appeal.
International Commercial Arbitration and Foreign Courts
Poland does not have an arbitration law, but provisions in the Polish Code of Civil Procedures of 1964, as amended, which is based to a large extent on UNCITRAL Model Law. Under the Code of Civil Procedure, an arbitration agreement must be concluded in writing. Commercial contracts between Polish and foreign companies often contain an arbitration clause. Arbitration tribunals operate through the Polish Chamber of Commerce, and other sector-specific organizations. A permanent court of arbitration is also at the Confederation Lewiatan in Warsaw.
In 2017 there were two major changes in the Polish arbitration landscape. Firstly, a new set of rules for consumer arbitration was introduced. These changes involve the form of an arbitration agreement as well as grounds for challenging an arbitral award and questioning the recognition or enforcement of an arbitral award. The amendments are aimed at reinforcing consumers’ rights in arbitration. Secondly, the Polish state became more active in the field of commercial and investment arbitration. The new law on the General Counsel to the Republic of Poland affected several issues. The General Counsel to the Republic of Poland (GCRP) took over arbitral cases from external counsels. Moreover, an arbitration court was established at the GCRP. Finally, the law broadened the scope of representation of the Polish state entities by the GCRP and introduced representation of the state-owned commercial companies.
The new act of December 15, 2016, on the General Counsel to the Republic of Poland is based on the rationale that the legal representation of the state in Poland is effective and can be reinforced and extended to other state-connected entities. The rule that the GCRP, in principle, represents the state in all domestic and non-domestic arbitrations and all post-arbitral cases in Poland has not changed under the new regulation. The new law, however, introduced the possibility of the GCRP representing certain entities – e.g., in litigations and arbitrations for amounts in dispute over 5 million zloty (approx. USD 1.5 million). The list of these entities includes major Polish state-owned enterprises in the airline, energy, banking, chemical, insurance, military, oil and rail industries as well as other entities such as museums, state-owned media and universities.
Poland’s bankruptcy law has undergone significant change and modernization in recent years. There is now a bankruptcy law and a separate, distinct restructuring law. Poland ranks 22 for ease of resolving insolvency in the World Bank’s Doing Business report 2018. Bankruptcy in Poland is criminalized if a company’s management does not file a petition to declare bankruptcy when company becomes illiquid for an extended period of time, or if a company ceases to pay its liabilities.
“Grupa BIK” is the main source of credit and economic information in Poland and covers the entire banking system. Grupa BIK consists of the Biuro Informacji Kredytowej S.A. (a credit information agency) and Biuro Informacji Gospodarczej InfoMonitor S.A. (an economic information agency) .
4. Industrial Policies
Poland’s Plan for Responsible Development identifies eight industries for development and incentives: aviation, defense, automotive parts manufacturing, ship building, information technology, chemical, furniture manufacturing and food processing. The full text of the plan can be found .
Poland encourages energy sector development through its energy policy. Supporting measures are explained in the document “Energy Policy of Poland until 2030. . The government is currently working on a new energy policy.
Poland’s financial support for foreign investors is generally sectoral in structure, and regional support is provided in the context of sectoral investments. A company investing in Poland, either foreign or domestic, may receive assistance from the Polish government. Foreign investors have the potential to access certain incentives such as: income tax and real estate tax exemptions in Special Economic Zones (SEZ); investment grants of up to 50 percent of investment costs (70 percent for small and medium-sized enterprises); grants for research and development; grants for other activities such as environmental protection, training, logistics, or use of renewable energy sources.
Large priority sector investments may qualify for the “Program for Supporting Investment of Considerable Importance for the Polish Economy for 2011-2020” which provides grants to large investments that create jobs in sectors including automotive, electronics, aviation, biotechnology, R&D, agriculture and food processing, and services (finance, information and communication, professional business services). Companies can learn more at: .
Regulations for special economic zones and public assistance to entrepreneurs provide the basis for exemptions from income tax or other incentives. Assistance (e.g., tax exemptions, grants) available for investments outside of SEZs vary with the development needs of each region. The government produces a regional aid map which specifies an assistance ceiling for each region, expressed as a percentage of a project’s new investment or employment costs. In early 2018 the government was preparing to overhaul Poland’s SEZ regime. Led by the Ministry of Entrepreneurship and Technology, the proposal envisions creation of one Polish Economic Zone streamlining of the process for applying for investment support. Individual SEZs are to become contact points for investors and will coordinate the process of approving state support such as grants and tax exemptions, but the ministry will make the final decision. The ministry intends to support companies located in SEZs not only on the basis of quantitative criteria (i.e. amount of investment or number of jobs created) but also qualitative criteria like compliance with the government’s export strategy. Small and medium-sized companies will be particularly favored in the new support scheme.
Poland does not have restrictions on government financed or subsidized national research and development programs. U.S. firms can participate in these programs if their company is registered in Poland.
U.S. Companies may apply for European funds through a Polish subsidiary or partner. EU Funds support investment in: e-administration, e-economy (Digital Poland Operational Plan); R&D support (Smart Growth Operational Plan); transport infrastructure, water and waste management and renewable energy systems (Infrastructure & Environment Operational Plan); Eastern region development (Eastern Poland Operational Plan); and support for education and training (Knowledge, Education and Development Operational Plan) and 16 Regional Operational Programs (for each voivodship).
Research and Development
The Polish government is seeking to increase Poland’s economic competitiveness by shifting toward a more knowledge-based economy. The government has targeted public and private sector investment in research and development (R&D) to increase to 1.7 percent of GDP by 2020. During 2014 – 2020 Poland will receive approximately USD 88.85 billion in EU Structural and Cohesion funds dedicated to R&D. Polish government programs such as the Responsible Development Plan focus on promoting an innovation-friendly business environment and improving R&D support system financing with better financial instruments and tax incentives. Businesses may also take advantage of the EU primary research funding program, Horizon 2020.
- Ministry of Investment and Economic Development:
- Ministry of Entreprenuershi and Technology:
- Ministry of Science and Higher Education:
The Second Law on Innovation (commonly referred to as the “Big Law on Innovation”) entered into force on January 1, 2018. Some of its provisions include:
- Tax credits for R&D raising the level of tax benefits up to 100 percent for both personal costs and for SMEs and large companies (raised from 50 percent in 2017);
- The extension of the catalog of eligible costs of non-durable materials;
- Clarification of labor costs and expert opinions as well as consulting services;
- Extension of the partial exemption from double taxation of limited partnerships and joint-stock limited companies (for the period of 2016-2023);
- Enabling the use of concessions by companies also taking advantage of incentives of Special Economic Zones;
- A tax credit of 150 percent for enterprises with Research and Development Center (RDC) status. The enterprises with this status can also benefit from additional eligible deductions (depreciation of buildings, places and expert reports made by entities other than research units – up to 10 percent of revenues).
Number 4 above is an important incentive for potential investors because it gives startups better access to financing from venture capital funds. The Ministry of Entrepreneurship and Technology, along with the Ministry of Science and Higher Education, is additionally working on a so-called Innovation Box (a.k.a Patent Box, IP box or knowledge box) which will allow companies to pay a lower tax on the revenues from commercialization of the new technologies, devices or solutions which contain IP intangibles.
Foreign Trade Zones/Free Ports/Trade Facilitation
Foreign-owned firms have the same opportunities as Polish firms to benefit from foreign trade zones (FTZs), free ports, and special economic zones. The 2004 Customs Law regulates operation of FTZs in Poland. The Minister of Finance and the Minister of Economy, establish duty-free zones. The Ministers designate the zone’s managing authorities, usually provincial governors who issue operating permits to interested companies for a given zone.
Most activity in FTZs involves storage, packaging, and repackaging. As of April 2016, there were seven FTZs: Gliwice, near Poland’s southern border; Terespol, near Poland’s border with Belarus; Mszczonow, near Warsaw; Warsaw’s Frederic Chopin International Airport; Szczecin; Swinoujscie; and Gdansk. Duty-free shops are available only for travelers to non-EU countries.
There are fourteen bonded warehouses: Bydgoszcz-Biale Blota; Krakow-Balice; Wroclaw-Strachowice; Katowice-Pyrzowice; Gdansk-Trojmiasto; Lodz; Braniewo; Poznan-Lawica; Rzeszow-Jasionka, Warszawa-Modlin, Lublin, Szczecin-Goleniow; Radom, Olsztyn-Mazury. Commercial companies can operate bonded warehouses. Customs and storage facilities must operate pursuant to custom authorities’ permission. Only persons established in the EU can receive authorization to operate a customs warehouse.
Performance and Data Localization Requirements
Poland has no policy of “forced localization” designed to force foreign investors to use domestic content in goods or technology. Investment incentives apply equally to foreign and domestic firms. Over 40 percent of firms in Special Economic Zones are Polish. There are very few data localization requirements in Poland and no requirements for foreign information technology (IT) providers to turn over source code and/or provide access to surveillance (backdoors into hardware and software or turn over keys for encryption). Exceptions exist in sectors where data are important for national security such as critical telecommunications infrastructure, and in gambling. In Poland, the national law on data retention is still in force despite the ECJ ruling invalidating the Data Retention Directive. The data retention period is 24 months. Poland previously required e-commerce entities to store customer details in Poland. After intervention by the European Commission, Poland was forced to lift the requirement and it is now sufficient the servers are located in one of the EU countries.
In the telecommunication sector, the Office of Electronic Communication (UKE) ensures telecommunication operators fulfill their obligations. In radio and television, National Broadcasting Council (KRRiT) acts as the regulator. Polish regulations protect an individual’s personal data that are collected in Poland regardless of where the data are physically stored. The Bureau of the Inspector General for Personal Data Protection (GIODO) enforces personal data regulation.
Poland is consulting legislation to implement the EU’s General Data Protection Regulation (GDPR). The Bureau of the Inspector General for the Protection of Personal Data (GIODO) will be replaced by the new Office for Personal Data Protection; it will be supported in its tasks by the Council for the Protection of Personal Data, which will act as a consultation and advisory body.
Post is not aware of excessively onerous visa, residence, work permit, or similar requirements inhibiting mobility of foreign investors and their employees. Generally Poland does not mandate local employment, but there are a few regulations that place de facto restrictions e.g. a certain number of board members of insurance companies must speak Polish.
Polish law limits non-EU citizens to 49 percent ownership of a company’s capital shares in the air transport, radio and television broadcasting, sectors as well as airport and seaport operations. There are also legal limits on foreign ownership of farm and forest lands as outlined in section 2 of this report under Limits on Foreign Control and Right to Private Ownership and Establishment. Pursuant to the Broadcasting Law, a TV broadcasting company may only receive a license if the voting share of its foreign owners does not exceed 49 percent and if they hold permanent residence in Poland. In the insurance sector, at least two members of management boards, including the chair, must speak Polish.
5. Protection of Property Rights
Poland recognizes and enforces secured interests in property, movable and real. The concept of a mortgage exists in Poland, and there is a recognized system of recording such secured interests. There are two types of publicly available land registers in Poland: the land and mortgage register (ksiegi wieczyste), the purpose of which is to register titles to land and encumbrances thereon, and the land and buildings register (ewidencja gruntow i budynkow), whose function is more technical as it contains information concerning physical features of the land, class of land and its use. Generally, real estate in Poland is registered and legal title can be identified on the basis of entries in the land and mortgage registers which are maintained by relevant district courts. Each register is accessible to the public and excerpts are available on application, subject to a nominal fee. The registers are available online.
Poland has a non-discriminatory legal system accessible to foreign investors that protects and facilitates acquisition and disposition of all property rights, including land, buildings, and mortgages. Many investors, foreign and domestic, complain the judicial system is slow in adjudicating property rights cases. Under the Polish Civil Code, a contract to buy real property must be made in the form of a notary deed. Foreign companies and individuals may lease real property in Poland without having to obtain a permit.
Widespread nationalization of property during and after World War II has complicated the ability to establish clear title to land in Poland, especially in major municipalities. While the Polish government has an administrative system for reviewing claims for the restitution of communal property, former individual property owners must file and pursue claims in the Polish court system in order to receive restitution. There is no general statute of limitations regarding the filing or litigation of private property restitution claims, but there are exceptions for specific cases. For example, in cases involving the communist-era nationalization of Warsaw under the Bierut Decree, there were claims deadlines that have now passed, and under current law, those who did not meet the deadlines would no longer be able to make a claim for either restitution or compensation. During 2017, Warsaw city authorities began implementing a 2015 law that critics stated might extinguish potential claims by private individuals of public properties seized during the Second World War or the communist era if no one comes forward to pursue a restitution claim within six months after publication of the affected property. Any potential claimants who come forward will have an additional three months to establish their claim after the initial six-month period. The city began publishing lists in February 2017, and is expected to continue to publish similar property cases going forward. The city’s website contains further information on these cases and the process to pursue a claim: .
It is sometimes difficult to establish clear title to properties. There are no comprehensive estimates of land without clear title in Poland.
On October 11, 2017, the Ministry of Justice announced comprehensive private property restitution draft legislation that would block any physical return of former properties, provide compensation of 20-25 percent of the property’s value at the time of taking in cash or government bonds, and set a one-year claims filing period. The legislation drew intense media coverage and public scrutiny, and critics argued the legislation would exclude potential foreign claimants, many of whom are Holocaust survivors or their heirs. As of March 2018, the Justice Ministry had not submitted the draft legislation to the Council of Ministers (cabinet) for review and approval to send to parliament.
The agricultural land law bans sale of Agricultural Property Agency (APA) (state-owned) farmland for five years. The impact of the five-year ban is not significant, as at present more than 90 percent of all agricultural land is already privately owned. State-owned farm land will be available only under long-term lease for farmers who want to enlarge their farms, to a maximum of 300 hectares (new and old land combined size). Foreigners can (and do) lease agricultural land. The agricultural land law also imposed restrictions on the sale of privately owned farm land, and gives the APA preemptive right to purchase in case of land sales by a private owner. Official statistics on the impact of the new law on prices and turnover of land is not available. Recently, the government announced plans to loosen these regulations. The Law on Forest Land similarly prevents Polish and foreign investors from purchasing privately-held forests and gives state-owned forestry agency (Lasy Panstwowe) preemptive right to buy privately-held forests.
Intellectual Property Rights
Polish intellectual property rights (IPR) law is stricter than European Commission directives require. Enforcement is good and improving across all IP types. Physical piracy (e.g., optical discs) is not a problem in Poland. However, online piracy continues to be widespread, despite progress in enforcement. .Poland does not appear in the USTR’s Special 301 or Notorious Markets reports.
Polish law requires a rights holder to start the prosecution process. In Poland, authors’ and creators’ organizations and associations track violations and present motions to prosecutors. Rights holders express concern that penalties for digital IPR infringement are not high enough to deter violators. In an effort to address these concerns, the Polish government established a national IPR strategy for 2015-2017 to address penalties.
The Polish Council of Ministers adopted a draft law on the collective management of copyright and related rights on January 30, 2018. The draft Act will implement EU Directive 2014/26/EU on the collective management of copyright and related rights and the granting of multi-territorial licenses regarding rights to music for online use on the internal market. The purpose of the bill is comprehensive regulation of the activities of collective management organizations in Poland. It will replace the existing provisions in this area, ex. chapters 12 and 12 (1) of the Copyright and Related Rights Act.
EU Regulation No 2015/2424 amends EU trademark regulation and entered into force on March 23, 2016 and harmonizes EU members’ laws on trademarks. EU members including Poland have three years to implement the regulation and up to six years for annulment and termination of trademarks. See the European Union Investment Climate Statement for details. As of March 23, 2016 it is not possible to apply for the European Union Trademark EUTM through the Patent Office of the Republic of Poland. The certification marks were introduced October 1, 2017. A trade mark may be filed to EUIPO individually or by a representative using: .
Polish customs tracks seizures of counterfeit goods, but failed to provide this information for the reporting period.
6. Financial Sector
Capital Markets and Portfolio Investment
The Polish regulatory system is effective in encouraging and facilitating portfolio investment. Both foreign and domestic investors may place funds in demand and time deposits, stocks, bonds, futures, and derivatives. Poland has healthy equity markets that facilitate the free flow of financial resources. Poland’s stock market is the largest and most developed in central Europe. Its capitalization amounted to 36 percent of GDP in 2017. The Warsaw Stock Exchange (WSE) is itself a publicly traded company with shares listed on its own exchange after its privatization in 2010. WSE has become a hub for foreign institutional investors targeting equity investments in the region. In addition to the equity market, Poland has a wholesale market dedicated to the trading of treasury bills and bonds (Treasury BondSpot Poland). This treasury market is an integral part of the Primary Dealers System organized by the Finance Ministry and part of the pan-European bond platform. Wholesale treasury bonds and bills denominated in PLN and some securities denominated in Euros are traded on the Treasury BondSpot market. Non-government bonds are traded on Catlyst, a WSE managed platform. The capital market is an important source of funding for Polish companies. The Polish government acknowledges the capital market’s role in the economy in its development plan. Foreigners may invest in listed Polish shares, but they are subject to some restrictions in buying large packages of shares. Liquidity remains tight on the exchange.
High-risk venture capital funds are becoming an increasingly important segment of the capital market. Polskie Stowarzyszenie Inwestorow Kapitalowych (Polish Association of Capital Investors) has calculated that PE/VC investments in Poland in 2017 exceeded EUR 2.2 billion. Poland is the leader in this respect in Central and Eastern Europe.
Poland provides full IMF Article VIII convertibility for current transactions. Banks can and do lend to foreign and domestic companies. Companies can and do borrow abroad and issue commercial paper, but the market is less robust than in Western European countries or the United States. The Act on Investment Funds allows for open-end, closed-end, and mixed investment funds, and the development of securitization instruments in Poland. In general, no special restrictions apply to foreign investors purchasing Polish securities.
Credit allocation is on market terms. The government maintains some programs offering below-market rate loans to certain domestic groups, such as farmers and homeowners. Foreign investors and domestic investors have equal access to Polish financial markets. Private Polish investment is usually financed from retained earnings and credits, while foreign investors utilize funds obtained outside of Poland as well as retained earnings. Polish firms raise capital in Poland and abroad. Inflation remained below the National Bank of Poland’s medium-term target rate of 2.5 percent in 2017. The Monetary Policy Council maintains a dovish tone, saying they expect to raise raises in late 2019 at the earliest.
Money and Banking System
The banking sector plays a dominant role in the financial system, accounting for about 70 percent of sector assets. The sector is predominantly privately owned. Poland had 63 commercial banks in 2017, according to the Central Statistical Office. The 553 cooperative banks play a secondary role in the financial system, but are widespread. The state owns eight banks (up from five in February 2016). The banking sector is liquid, profitable and major banks are well capitalized. Profitability decreased slightly in 2017 and remains at a reasonable level (ROE at 7.3 percent in mid-2017). Profits are likely to be under pressure due to record low interest rates, an unsolved issue of conversion of Swiss Francs mortgage portfolios into PLN, and a possible revision to the tax on financial sector assets that entered into force in February 2016. The financial sector assets tax is a monthly 0.0366 percent tax on lenders’ assets which is not deductible from income tax calculations. In 2017, banks paid PLN 3.7 (approx. USD 1.0 billion). Many new regulations (including PSD2, MiFID II, AML IV, RODO) are expected to further squeeze profit margins within the banking sector.
In general, supervision and risk management contained excessive risk-taking. Since 2015, the Polish government established an active campaign aiming to increase the market share of national financial institutions. The State share of direct and indirect controlled banks has reached almost 55 percent of the sector’s total assets, leading to domestic ownership for the first time exceeding the foreign share in the sector. The two largest banks are under state control. At the end of 2017, total assets of the five biggest banks in Poland amounted to approx. USD 230.0 billion, representing almost 48 percent of total assets of the sector. Poland’s strong fundamentals and the size of its internal market mean that many foreign banks will want to retain their positions. Five of six foreign owners of large Polish banks increased their profits in 2017. Some international banks use Poland as an offshoring location.
The Polish National Bank (NBP) is Poland’s central bank. At the end of 2017, most banks met regulatory capital adequacy ratios. Poland’s banking sector meets European Banking Authority regulatory requirements. The share of non-performing loans is close to the EU average and recently has been falling. Between January-September 2017 non-performing loans were six percent of portfolios.
The national bank (NBP) currently has correspondent banking relationships with 25 banks commercial and central banks, and uses TARGET2-NBP solution for EUR clearing. While NBP monitors and evaluates relations with corresponding banks, they have not recently lost nor do they anticipate losing any correspondent banking relationships.
The EU’s Digital Scoreboard study for 2017 reports that consumers in Poland are increasingly using the internet for banking transactions and shopping, with Poland closing the gap with its EU peers; 53 percent and 56 percent of internet users in Poland turned to the internet for banking and shopping, respectively, compared with EU averages of 59 percent and 66 percent.
In April 2018 Poland and 21 other EU countries signed a Declaration to create a European Partnership intended as a vehicle for cooperation amongst Member States to exchange experience and expertise in technical and regulatory fields, and to prepare for the launch of EU-wide blockchain applications across the Digital Single Market for the benefit of the public and private sectors. While there is no official government strategy regarding development and application of blockchain in the banking sector, a number of additional initiatives have taken place in recent years. The Special Task Force for Financial Innovation in Poland (FinTech) was created by KNF, the Ministry of Finance and the former Ministry of Economic Development (currently it is the Entrepreneurship and Technology Ministry) in response to the dynamic development of new technologies on the financial services market. The Task Force identifies legal, regulatory and supervisory barriers to the development of financial innovations in Poland and proposes solutions. For more information see: .
In March 2018, a major state-controlled bank PKO Bank Polski announced a partnership with company to provide a -based storage and verification system for documents. Banks have become more interested in using Blockchain for document management systems, as existing tools have security vulnerabilities. Lender BZ WBK, whose main shareholder is Santander, in April 2018 launched its quick international payment service based on blockchain technology. The pilot implementation includes both individual and business clients transferring funds to the UK. The bank is also planning on blockchain-based quick transfers to Spain.
Foreign Exchange and Remittances
Poland is not a member of the Eurozone; its currency is the Polish Zloty. The Polish Zloty (PLN) is a floating currency; it has largely tracked the euro (EUR) at approximately PLN 4.2-4.3 to EUR 1 in recent years. Foreign exchange is available through commercial banks and exchange offices. Payments and remittances in convertible currency may be made and received through a bank authorized to engage in foreign exchange transactions, and most banks have authorization. Foreign investors have not complained of significant difficulties or delays in remitting investment returns such as dividends, return of capital, interest and principal on private foreign debt, lease payments, royalties, or management fees. Foreign currencies can freely be used for settling accounts.
Poland provides full IMF Article VIII convertibility for current transactions. Polish Foreign Exchange Law, as amended, fully conforms to OECD Codes of Liberalization of Capital Movements and Current Invisible Operations. In general, foreign exchange transactions with the EU, OECD, and European Economic Area (EEA) are accorded equal treatment and are not restricted.
Except in limited cases which require a permit, foreigners may convert or transfer currency to make payments abroad for goods or services and may transfer abroad their shares of after-tax profit from operations in Poland. Foreign investors may freely withdraw their capital from Poland. Full repatriation of profits and dividend payments is allowed without obtaining a permit. However, a Polish company (including a Polish subsidiary of a foreign company) must pay withholding taxes to Polish tax authorities on distributable dividends unless a double taxation treaty is in effect, which is the case for the United States. The United States and Poland signed an updated bilateral tax treaty in February 2013, that the United States has not yet ratified. As a rule, a company headquartered outside of Poland is subject to corporate income tax on income earned in Poland, under the same rules as Polish companies.
Foreign exchange (FX) regulations require non-bank entities dealing in foreign exchange or acting as a currency exchange bureau to submit reports electronically to the National Bank of Poland (NBP) at . An exporter may open foreign exchange accounts in the currency it chooses.
Poland does not prohibit remittance through legal parallel markets utilizing convertible negotiable instruments (such as dollar-denominated Polish bonds in lieu of immediate payment in dollars). As a practical matter, such payment methods are rarely, if ever, used.
Sovereign Wealth Funds
The Polish government does not maintain a Sovereign Wealth Fund. However, the government established the Polish Development Fund (PFR), an umbrella organization pooling resources of several governmental agencies and departments, including EU funds. A strategy for the Fund was adopted in September 2016, and it was registered in February 2017 at which point the Ministry of Economic Development took supervision over the Fund (since 2018 it is the Investment and Development Ministry). The PFR can also count on support from the finance ministry via treasury bonds. PFR supports the implementation of the Responsible Development Strategy. About a quarter of initiatives outlined as part of the Strategy is correlated with the objectives of the PFR.
The PFR operates as a loose financial group of state-owned banks and insurers, investment bodies and promotion agencies. The budget of PFR group reaches PLN 14 billion, which managers estimate will be sufficient to raise capital worth PLN 90-100 billion. Various actors within the organization can invest through acquisition of shares, through direct financing, seed funding, and co-financing venture capital. Depending on the instruments, PFR expects different rates of return. PFR intends to launch a new fund of funds in 2018 with the aim of financing capital investments valued at PLN 50-100 million (USD 14.7 – 29.4 million).
7. State-Owned Enterprises
Some U.S. investors have recently expressed concern that the government favors SOEs by offering loans from the national budget as a capital injection, preferential treatment in government tenders, and unfairly favoring SOEs in investment disputes. Since Poland’s EU accession, government activity favoring state-owned firms has received careful scrutiny from Brussels. Since the Law and Justice government came to power in 2015, there has been a considerable increase in turnover in managerial positions of state-owned companies. SOEs are governed by a board of directors and most pay an annual dividend to the government, as well as prepare and disclose annual reports.
In January 2017, the government passed a law abolishing the Ministry of State Treasury. At its dissolution, the Treasury managed a diverse portfolio of several hundred active and inactive companies with total or partial state ownership. The portfolio has since been broken up, with the firms transferred to other government entities. State owned enterprises (SOEs) still exist mainly in the chemical, defense, energy and financial sectors. The government intends to keep majority share ownership and/or state-control of economically and strategically important firms.
Among them are companies of “strategic importance” whose shares cannot be sold, including among others: Grupa Azoty SA, Grupa LOTOS SA, KGHM Polska Miedz SA, Energa SA.
The government sees SOEs as drivers and leaders of its innovation policy agenda; in 2017 state ownership in the banking and energy sectors was significantly increased. For example, several energy SOEs established a company to develop electro mobility. So far the SOEs’ performance remained overall strong and broadly similar to that of private companies. However, international evidence suggests that a dominant role of SOEs can pose fiscal, financial, and macro-stability risks.
As of April 2018, there were over 400 companies in partnership with state authorities. Among them there are companies under bankruptcy, in liquidation and companies where Treasury held residual shares. Here is a link to the list of companies, including information under the control of which ministry they fall: .
The value of stock owned by the state in publicly-held companies, many of which are the biggest companies in their sectors, was worth over USD 30 billion (PLN 113 billion) in 2017. The same standards are generally applied to private and public companies with respect to access to markets, credit, and other business operations such as licenses and supplies. Government officials occasionally exercise discretionary authority to assist SOEs. In general, SOEs are expected to pay their own way, finance their operations, and fund further expansion through profits generated from their own operations.
OECD Guidelines on Corporate Governance of SOEs
In Poland, the same rules apply to SOEs and publicly listed companies unless statutes provide otherwise. In 2016, the newly formed Ministry of Energy started to supervise state-owned power utilities, oil and gas firms, as well as coal mining companies. The State exercises its influence through its rights as a shareholder in proportion to the number of voting shares it holds (or through shareholder proxies). In some cases, a SOE is afforded special rights as specified in the company’s articles, and in compliance with Polish and EU laws. In some non-strategic companies, the state exercises special rights as a result of its majority ownership but not as a result of any specific strategic interest. Despite some of these specific rights, the state’s aim is to create long-term value for shareholders of its listed companies by adhering to the OECD SOE Guidelines. State representatives who sit on supervisory boards must comply with the Commercial Companies Code and are expected to act in the best interests of the company and its shareholders.
SOE employees may designate two fifths of the Supervisory Board’s composition. In addition, according to Poland’s privatization law, in wholly state-owned enterprises with more than 500 employees, the employees are allowed to elect one member of the Management Board. SOEs are subject to a series of additional disclosure requirements above those set forth in the Company Law. The supervising ministry prepares specific guidelines on annual financial reporting to explain and clarify these requirements. SOEs have to prepare detailed reports on management board activity, plus a report on previous financial year activity, and a report on the result of the examination of financial reports. State representatives to supervisory boards have to go through examinations to be able to apply for a board position. Many major state owned companies are listed on the Warsaw Stock Exchange (WSE) and are subject to the “Code of Best Practice for WSE Listed Companies.”
On September 30, 2015, the Act on Control of Certain Investments entered into force. The law creates mechanisms to protect against hostile takeovers of companies operating in strategic sectors (gas, power generation, chemical, petrochemical and defense sectors) of the Polish economy (see section 2 on Investment Screening), most of which are SOEs or state-controlled.
The new SOE governance law of 2017 is being implemented gradually. The framework formally keeps the oversight of the SOE supervision centralized, while transferring the responsibilities from the Ministry of the Treasury to the Prime Minister’s Office (PMO). However, the supervision has been delegated to line ministries, some of which (e.g. the Ministry of Energy) set their own supervisory guidelines. In October 2017, the PMO issued supervisory guidelines as a reference framework for line ministries. The PMO is additionally preparing a revision to the law which increases its supervisory rights. The objective of the SOEs’ management is defined as sustainable growth in share values, considering an economic policy of the state.
A merger of two major energy sector companies (PKN Orlen and Lotos) was announced in March 2018. The Polish government has completed the privatization of most of the SOEs it deems not to be of national strategic importance. With few exceptions, the Polish government has invited foreign investors to participate in major privatization projects. In general, privatization bidding criteria have been clear and the process transparent. There are nearly 50 SOEs classified as “economically important” and over 20 as “strategically important”, most in the energy, mining, and financial sectors. The government intends to keep majority share ownership of these firms, or to sell tranches of shares in a manner that maintains state control. The government is currently focused on consolidating and improving the efficiency of the remaining SOEs.
8. Responsible Business Conduct
Starting from 2018, around 300 Polish companies will be obligated to publish to a non-financial information statement alongside their business activity report – this is tied to the 26 January 2017 amendment of the Act on Accounting, which implements directive 2014/95/UE into Polish law. The rules of the act concern companies that fulfill two out of the three following criteria: the average annual number of employed persons numbers over 500 individuals; the company’s balance sheet totals to over 85 million Polish zlotys (approx. USD 30 million), or the gross earnings from the sale of commodities and products for the fiscal year amount to 170 million zlotys (USD 46 million). Despite this new requirement, companies often voluntarily compile CSR activity reports based on international reporting standards.
Poland’s Ministry of Investment and Development (formerly the Ministry of Economic Development) supports implementation of responsible business conduct (RBC) and corporate social responsibility (CSR) programs. A working group responsible for CSR issues has existed since 2015 to provide recommendations concerning the implementation directions of CSR standards with regards to the Strategy for Responsible Development. The group consists of representatives of federal and local governments, trade unions and employer organizations and representatives of social organizations and scientific institutions.
In May 2017, the Council of Ministers adopted the National Action Plan (NAP) for the Implementation of the United Nations Guiding Principles on Business and Human Rights 2017-2020 (UNBHR-GPs). In October 2017 the Ministry of Economic Development hosted a conference on Poland’s NAP as set out by the UNBHR. The Working Group for CSR Strategy is developing a NAP implementation framework on the basis of the Strategy for Sustainable Development, UN Sustainable Development Goals (SDGs), and relevant OECD guidelines, as well as determining how its implementation may be measured in the future.
In November 2017, the Minister of Economic Development and Finance adopted the new stakeholder cooperation program titled Program of partner cooperation between the Ministry of Economic Development and stakeholders for 2018-2019, which encompasses cooperation not only with non-governmental organizations, but also with trade unions, commerce chambers, and academic institutions. Cooperation takes the form of long-term, voluntary, and active participation by the Ministry and partners in co-implementation of sustainable development activities. Independent organizations including non-governmental organizations (NGOs), business and employee associations promote CSR in Poland. The Responsible Business Forum (RBF), founded in 2000, is the oldest and largest NGO in Poland to focus on corporate social responsibility: . CSR Watch Coalition Poland, part of the OECD Watch international network aims to advance respect for human rights in the context of business activity in Poland in line with the spirit of the UNBHR-GPs and the OECD Guidelines for Multinational Enterprises (MNEs): .
The NCP promotes the OECD MNE Guidelines through seminars and workshops. Investors can obtain information about the Guidelines and their implementation through Regional Investor Assistance Centers.
Poland has issued a green bond for EUR 750m to finance a range of climate-related projects. Proceeds will finance projects that contribute to Poland’s progress in meeting its greenhouse gas emission (GHG) reduction targets and promote the country’s transition to a low carbon economy. Poland’s government plans to spend up to PLN 30 billion (approx. USD 8.8 Billion) over the next decade on a new subsidy program “Stop Smog.” A “fuel emission tax” is to be introduced to raise funds for fighting air pollution.
Poland is not a member of the Extractive Industries Transparency Initiative (EITI) or the Voluntary Principles on Security and Human Rights. The primary extractive industries in Poland are coal, lignite and copper mining. Onshore, there is also hydrocarbon extraction, primarily conventional natural gas production, with limited exploration for shale gas. The Polish government exercises legal authority and receives revenues from the extraction of natural resources and from infrastructure related to extractive industries such as oil and gas pipelines through a concessions-granting system, and in most cases through shareholder rights in state-owned enterprises. The GOP has two revenue streams from natural resources: 1) from concession licenses; and 2) from corporate taxes on the concession holders. License and tax revenues apply equally to both state-owned and private companies. Natural resources are brought to market through market-based mechanisms by both state-owned enterprises and private companies.
Poland has laws, regulations, and penalties aimed at combating corruption of public officials and counteracting conflict of interest. Anti-corruption laws extend to family members of officials and to members of political parties who are members of parliament. There are also anti-corruption laws regulating the finances of political parties. According to a local NGO, an increasing number of companies are implementing voluntary internal codes of ethics. In 2017, the Transparency International (TI) index of perceived public corruption ranked Poland as the 36th least corrupt among 180 countries/territories. Due to the downward trend of corruption in Poland, Transparency International closed its Polish chapter in 2011.
UN Anticorruption Convention, OECD Convention on Combatting Bribery
The Polish Central Anti-Corruption Bureau (CBA) and national police investigate public corruption. The Justice Ministry and the police are responsible for enforcing Poland’s anti-corruption criminal laws. The Finance Ministry administers tax collection and is responsible for denying the tax deductibility of bribes. Reports of alleged corruption most frequently appear in connection with government contracting and the issuance of a regulation or permit that benefits a particular company. Allegations of corruption by customs and border guard officials, tax authorities, and local government officials show a decreasing trend. If such corruption is proven, it is usually punished.
Overall, U.S. firms have found that maintaining policies of full compliance with the U.S. Foreign Corrupt Practices Act (FCPA) is effective in building a reputation for good corporate governance and that doing so is not an impediment to profitable operations in Poland. Poland ratified the UN Anticorruption Convention in 2006 and the OECD Convention on Combating Bribery in 2000. Polish law classifies the payment of a bribe to a foreign official as a criminal offense, the same as if it were a bribe to a Polish official.
At its March 2018 meeting, the OECD Working Group on Bribery urged Poland to make progress on carrying out key recommendations that remain unimplemented more than four years after its Phase 3 evaluation in June 2013.
Resources to Report Corruption
Centralne Biuro Antykorupcyjne (Central Anti-Corruption Bureau – CBA)
al. Ujazdowskie 9, 00-583 Warszawa
+48 800 808 808
; link: Zglos Korupcje (report corruption)
The Batory Foundation, Public Integrity Program serves as a non-governmental watchdog organization. The foundation can be reached by whistleblowers at +48 (22) 536 0257 or email@example.com.
10. Political and Security Environment
Poland is a politically stable country. Constitutional transfers of power are orderly. The last presidential elections took place in May 2015 and parliamentary elections took place in October 2015; observers considered both elections free and fair. The new government formed in November 2015, however, there was a change of the Prime Minister in December 2017 and a major government reshuffle in January 2018. The next elections are scheduled for the fall of 2019 for the national parliament and in May 2020 for the presidency. Local and regional elections will be held in November 2018, and elections to the European Parliament will be held in spring 2019.
There have been no confirmed incidents of politically motivated violence toward foreign investment projects in recent years. Poland has neither insurgent groups nor belligerent neighbors. The Overseas Private Investment Corporation (OPIC) provides political risk insurance for Poland but it is not frequently used, as competitive private sector financing and insurance are readily available.
11. Labor Policies and Practices
Poland has a well-educated, skilled labor force. Productivity remains below OECD standards but is rising rapidly, and unit costs are competitive. In the last quarter of 2017, the average gross wage in Poland was PLN 4,517 (approx. USD 1,330 per month), according to the Central Statistical Office (GUS), compared to 4,219 (approx. USD 1,240) in the last quarter of 2016. Poland’s economy employed roughly 16.510 million people in the third quarter of 2017. Eurostat measured total Polish unemployment at 4.5 percent, with youth unemployment at 14.5 percent in December 2017. GUS reports unemployment rates differently and tends to be higher than EU figures. Unemployment varied substantially between regions, the highest rate (11.8 percent (GUS rate) in north-eastern part of Poland (Warmia and Mazury), and the lowest at 4 percent (GUS rate) in the western province of Wielkopolska, in the third quarter of 2017. Unemployment was lowest in major urban areas. Polish workers are usually eager to work for foreign companies, in Poland and abroad. Since Poland joined the EU, up to two million Poles have sought work in other EU member states.
A January 2018 revision of the law on promoting employment and labor market institutions introduced greater regulatory control over the “simplified procedure” of hiring foreigners from six countries (Ukraine, Belarus, Georgia, Armenia, Moldova and Russia), which allows foreigners from these countries to work in Poland without a work permit for six months. According to Ministry of Family, Labor and Social Policy, 1.8 million “simplified procedure” work declarations were registered in 2017. Under the revised procedure, local authorities may verify if potential employers have actual job positions for potential foreigner workers. The law also authorizes local authorities to refuse declarations from employers with a history of abuse, as well as to ban employers previously convicted of human trafficking from hiring foreigners. During the last year there has been a gradual increase in the number of Ukrainian migrant workers. The Ministry of Family, Labor and Social Policy statistics show that in 2017, 192,000 Ukrainians received a work permit, and the Polish authorities registered 1.7 million work declarations for Ukrainians. 1.3 million Ukrainians undertook employment in Poland. There is anecdotal evidence that additional Ukrainians are employed without work permits.
Despite this influx of foreign workers, Polish companies suffer from a shortage of qualified workers. The most sought-after specialists are engineers, IT specialists, salespersons, project managers, and technical advisors. Manufacturing companies seek welders, bricklayers, and machinery operators. Employment has expanded in service industries such as information technology, manufacturing, administrative and support service activities. The business process outsourcing industry in Poland has experienced dynamic growth. The state-owned sector employs about a quarter of the work force, although employment in coal mining and steel are declining.
In October 2017, a retirement law entered into force that lowered the retirement age for men (from 67 to 65) and for women (from 67 to 60). The Parliament passed a bill on December 7, 2018 abolishing the limit beyond which Poles do not pay pension or disability contributions, a move which will increase social insurance contributions by 5.4 billion PLN/year (USD 1.5 billion). The measure will significantly increase HR costs for employers of high-skilled workers and workers’ own contributions to social insurance. The law is in a one year vacatio legis. Labor laws differentiate between layoffs and firing. In the case of layoffs (when workers are dismissed for economic reasons in companies which hire more than twenty employees), employers are required to offer severance pay; in the case of firing, the labor law does not require severance pay.
Most workers hired under labor contracts have the legal right to establish and join independent trade unions and to bargain collectively. However, workers hired on civil contracts and the self-employed do not have the right to join a trade union. In June 2015, the Constitutional Court ruled the limitation on establishing and joining a trade union is unconstitutional, and a revision to the law to this effect has been drafted and is now going through the parliament. Trade union influence is declining, though unions remain powerful in coal-mining and shipyards.
The Polish labor code outlines employee and employer rights in all sectors, both public and private, and has been gradually revised to adapt to EU standards. However, employers tend to use temporary and contract workers for jobs that are not temporary in nature. Employers use short-term contracts because they allow firing with two weeks’ notice and without consulting trade unions on the decision. Employers also tend to use civil instead of labor contracts because of ease of hiring and firing, even in situations where work performed meets all requirements of a regular labor contract.
The law requires equal pay for equal work and equal treatment with respect to signing labor contracts, employment conditions, promotion, and access to training. The law defines equal treatment as nondiscrimination in any way, directly or indirectly on the grounds of gender, age, disability, race, religion, nationality, political opinion, ethnic origin, denomination, sexual orientation, whether or not the person is employed temporarily or permanently, full time or part time.
The 1991 law on conflict resolution defines the mechanism for labor dispute resolution. It consists of four stages: first, the employer is obliged to conduct negotiations with his employees; the second stage is a mediation process, including an independent mediator; if an agreement is not reached through mediation, the third stage is arbitrage, which takes place at the regional court; the fourth stage of conflict resolution is a strike.
The Polish government adheres to the ILO’s core conventions and generally complies with international labor standards. However there are several gaps in enforcing the law, including legal restrictions on the rights of workers to form and join independent unions. Cumbersome procedures make it difficult for workers to meet all of the technical requirements for a legal strike. The law prohibits collective bargaining for key civil servants, appointed or elected employees of state and municipal bodies, court judges and prosecutors. There were some limitations with respect to identification of victims of forced labor. Despite prohibitions against discrimination with respect to employment or occupation, such discrimination occurs. Authorities do not consistently enforce minimum wage, hours of work and occupational health and safety, either in the formal or informal sectors.
The National Labor Inspectorate (NLI) is responsible for identifying possible labor violations; it may issue fines and notify the prosecutor’s office in cases of severe violations. According to the trade unions, however, the NLI does not have adequate tools to hold violators accountable and the small fines imposed as punishment are an ineffective deterrent to employers.
The United States has no FTA or preference program (such as GSP) with Poland which includes labor standards.
12. OPIC and Other Investment Insurance Programs
The Overseas Private Investment Corporation (OPIC) provides political risk insurance for U.S. companies investing in Poland against political violence, expropriation, and inconvertibility of local currency. OPIC offers medium and long-term financing in Poland through its direct loan and guarantee programs. Direct loans are reserved for U.S. businesses or cooperatives. Loan guarantees are issued to U.S. lending institutions.
13. Foreign Direct Investment and Foreign Portfolio Investment Statistics
Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
*In Poland the National Bank of Poland (NBP) collects data on FDI. Annual FDI report/data are published at the end of the following year. GDP data are published by the Central Statistical Office. Final annual data are available at the end of May of the following year.
**Data are suppressed to avoid disclosure of data of individual companies.
Table 3: Sources and Destination of FDI
|Direct Investment from/in Counterpart Economy Data|
|From Top Five Sources/To Top Five Destinations (US Dollars, Millions)|
|Inward Direct Investment||Outward Direct Investment|
|Total Inward||187,322||100%||Total Outward||29,723||100%|
|“0” reflects amounts rounded to +/- USD 500,000.|
Results of table are consistent with the data of the National Bank of Poland (NBP). NBP publishes FDI data in October/November.
A number of foreign countries register businesses in the Netherlands, Luxemburg and Cyprus hence results for these countries include investments from other countries/economies.
Table 4: Sources of Portfolio Investment
|Portfolio Investment Assets|
|Top Five Partners (Millions, US Dollars)|
|Total||Equity Securities||Total Debt Securities|
|All Countries||32,883||100%||All Countries||21,061||100%||All Countries||11,820||100%|
Note: NBP publishes only total amounts of portfolio investment assets.
Results of table are consistent with the data of the National Bank of Poland (NBP). NBP publishes FDI data in October/November.
A number of foreign countries register businesses in the Netherlands, Luxemburg and Cyprus hence results for these countries include investments from other countries/economies.
14. Contact for More Information
Trade and Investment Officer
Ul. Ujazdowskie 29/31, 00-540, Warsaw, Poland
+48 22 504 2000