While the Act on Electromobility is still in preparation, the Polish Minister of Energy brings a Policy for the Deployment of Alternative Fuels Infrastructure in its Easter egg basket. The goals for electricity, along with natural gas (CNG, LNG), are set out for 2020 and 2025.
With effect from 1 March 2017, Czech Act No. 284/2009 Coll. on Payment System (the Act) has been amended in accordance with the Directive No. 2014/92/EU on the comparability of fees related to payment accounts, payment account switching and access to payment accounts with basic features (the Directive).
One of the purposes of the Directive is to provide consumers with non-discriminatory access to payment accounts in any EU member state. According to European Commission, there are more than 3 million people in the EU to whom opening of the payment account has been denied. Moreover, more than 20 million people in the EU would be interested in opening the payment account but do not even attempt to do so, since they are afraid it would be connected with high costs.
In this article, I will describe one of the most significant innovations introduced by the amended Act: the payment account with basic futures (the Basic Account). Continue Reading
The commentators will certainly qualify the following court judgments as landmark rulings since by these judgments the courts shed light on crucial and highly controversial aspects of competition law.
On 28 March 2017, the Ministry of Digital Affairs (the “Ministry”) presented a preliminary draft of some of the provisions of the new Personal Data Protection Act. The remaining part of the Act that is not included in the presented project – which concerns regulations on the new data protection authority’s system position, transitional rules, and regulations changing sectoral regulations – is still being prepared.
The project presented by the Ministry aims at implementing the General Regulation of the European Parliament and of the Council (EU) 2016/679 of 27 April 2016 on the protection of data (the “GDPR”) in national law. It is worth remembering that the GDPR is, in principle, an effective act of EU law, but in some cases requires national legislative action.
According to the information provided by the Ministry advisor, the Ministry plans to present a final draft of the new Personal Data Protection Act, along with the amendments to the detailed law, in June 2017. The submission of the draft law to the Parliament is planned for autumn 2017, and the completion of its legislative process at the beginning of 2018. The new Data Protection Act should enter into force on May 25, 2018 when the GDPR begins to apply.
Below is an overview of the most important issues with regard to the currently released version of the project. Please note that it is not a final version of the draft so it may be changed.
Protection of female workers continues to be a topical problem, especially in a retail sector where women account for a considerable share of the total workforce. Workers who combine their paid employment with parental functions enjoy a number of entitlements. Most of such entitlements pertain to both employed women and employed men, e.g. parental or child-care leave. Additionally, women are subject to protection against excessively strenuous working conditions throughout their entire working life, which is further strengthened during the period of pregnancy and breastfeeding.
The Polish Labour Code was amended in 2016 by replacing the general prohibition of
the employment of women in strenuous and harmful work with the prohibition that is applicable only to expectant and breastfeeding women. Continue Reading
An amendment of the Czech Insolvency Act was published in the Collection of Laws on 3 March 2017 and becomes effective on 1 July 2017. It brings important changes for personal bankruptcies, as well as regulation of corporate insolvencies. Two issues that might be of interest to corporations, regulation of forum shopping and prohibition of voting by the group creditors, are discussed in this article on our Insolvency and Restructuring blog.
If you are or will be doing business with Slovak state, local government, municipality or a legal entity financed or controlled by the state, or you are receiving EU funds, as of February 1, you must be registered in the new Register of Public Sector Partners (the “Register”) and disclose your ultimate beneficial owners (UBO). The purpose of this new law is to enhance transparency in the use of public funds. This should be achieved by disclosing the ownership structure and ultimate beneficial owner(s). The Register replaced the Register of Beneficial Owners that was established for purpose of public procurements.
Public Sector Partner
So who is a public sector partner? Basically anyone (being a Slovak entity or foreigner) who entered into or will enter into any agreement with public sector institution such as ministries, municipalities, health insurance companies etc. and value of their contract exceeds €100,000; or in case of multiple payments, €250,000 in a calendar year (“Partners”). But the list of entities subject to registration does not stop here. It also includes subcontractors of such Partners, if they also meet the financial thresholds.
If you are considered to be the Partner, you have to register (at least for the duration of the contract) in the Register. If you have already been registered in the Register of Beneficial Owners, you are automatically registered in the Register. However, by July 31, 2017, you must submit a verification document confirming your UBO. The Register will be maintained by the District Court Žilina and is publically available on the website of the Ministry of Justice of the Slovak Republic.
Ultimate Beneficial Owner
So who is your UBO? Definition of UBO is given in the Anti-money laundering Act. UBO is:
For legal entities (other than publicly traded entities and trusts), a person:
- Having at least 25% direct or indirect share on the voting rights or at least 25% direct or indirect shareholding of bearer’s share.
- Having a right to appoint or recall a statutory, managing, supervisory or controlling body of an entity or any member thereof.
- Controlling the entity in any other way than described under (1) and (2) above.
- Having at least 25% share on the positive economic result of the entity or from its other activities.
For entrepreneurs, a person having at least 25% share on the positive economic results of the entity or from its other activities.
For a trust, a person that:
- Is a founder of the trust; or where a founder is a legal entity, a person covered under the legal entities criteria above.
- Has a right to appoint or recall a statutory, managing, supervisory or controlling body of an entity or any member thereof or is a member of a body that has a right to recall a statutory, managing, supervisory or controlling body of an entity or any member thereof.
- Is a statutory, managing, supervisory or controlling body or a member of such body.
- Receives at least 25% of funds provided by the trust, where recipients have been determined; or where recipients have not been determined, beneficial owners are persons that significantly benefit from activities of the trust or its foundation.
If no person meets criteria described above, then top management is deemed to be ultimate beneficiaries, i.e., directors, proxy holder and manager on level “Board-1”. A UBO is also a person that does not meet any of the criteria above, but meets them when acting together with other person or in concert with other person.
Don’t worry – You are not the one responsible for investigating and verifying who your UBO really is (although the Act assumes you know it and should have no problem disclosing it). This will be verified by a Slovak lawyer, auditor, a notary, or a bank (a so-called “authorized person”). If you already have a Slovak legal counsel, they should be able to do it for you but there are rumors on the market that not all lawyers will actually do so given the liability related to it.
And not just that. An authorized person will also register you in the Register and verify at the end of each year whether your UBO is still the same. If the UBO has changed, then the authorized person must update the registration within 60 days from when the change occurred. Of course, if you know your UBO has changed, you should inform your authorized person without delay. So you rather do not plan any vacation over that time of the year, as your cooperation will be needed.
One can expect that the authorized person would charge for this service. The more complicated the ownership structure is, and more foreign jurisdictions are involved, the more expensive it would get.
If the registered information regarding your UBO is not accurate or you fail to update it as required a fine can be imposed on either:
(a) the Partner in the amount equal to the economic benefit under the contract with a public institution; or, if the economic benefit cannot be determined, a fine in the amount of €10,000 up to €1 million .
(b) a statutory body or each member of the statutory body (i.e. a director) holding the office when the breach occurred, in the amount of €10,000–€100,000.
In addition, once a fine is imposed on the Partner, the Partner is removed from the Register and can no longer contract with public institutions or receive EU funds and the existing contract can be terminated by the public institution. If a director is fined, they are automatically removed from a director position and disqualified from holding such position for a period of three years from the effective date of the decision.
One thing to note in this respect is that anyone can raise doubts as to the accuracy of information of UBO (yes, your competitors as well!) and, thus, initiate proceedings at the Žilina court. This is yet another tool that should prevent companies from hiding information on their UBOs. However, even if it proves true that you information is correct; facing any investigation can shed a negative light on a company which might be just negotiation its contract with a public institution.
When to Register
July 31, 2017, is still a little way off, but given the complexity of the verification process, as well as the lack of clarity as to how this verification should be done in foreign jurisdictions, we would suggest that you don’t leave compliance with this obligation to the last moment.
The leader of Poland’s ruling party, Jarosław Kaczyński, has come out strongly in favor of construction of a new mega-airport outside of Warsaw.
The new mega-airport proposal was initially vetted as part of Poland’s plan for constructive development, announced by the Law & Justice Party when it won Poland’s parliamentary elections and gained control of Parliament a year and half ago.
Despite strong support for the project by the management of LOT Polish Airlines, the proposal has been subject to much discussion and criticism as being uneconomic, too expensive and a waste of resources already invested in the two Warsaw airports, Chopin Okęcie and Modlin.
Legislation recently passed by the Polish Parliament grants a Parliamentary Commission the right to rescind reprivatization decisions previously issued with respect to real property in the city of Warsaw. Such a rescission would remove the legal grounds for return of the property to the ex-owner or its legal successor, which could lead to seizure of the real property by the government.
In this Article, I will share with you some legal insights regarding investment in the Czech Republic and summarize important points characterizing legal environment here in 2017.
If you are thinking about investing in the Czech Republic you will need to consider a wide range of factors from technical to tax. It is likely that you will be focused on particular business opportunities and whether they are worth your money or not. You will be dreaming about high returns, multiplied EBITDAs and, with this in mind, you will use your imagination to compile the perfect plan to increase the value of your investment. I honestly believe that legal matters may be some of the last aspects you consider – particularly as they deal with the least pleasant pictures of conflicts, stress and gradual devastation of the investment.
But wait a moment and consider a different angle: Everybody likes to be protected, right? Well, this is exactly what the law is for!
Let’s look at the investment environment in the Czech Republic in 2017 through our brand new glasses and try to summarize the most important points. Continue Reading