Transition Plan for Poland’s WIBOR Benchmark to a Waterfall Methodology Is Announced

Stock and shares digital boardWIBOR (Warsaw Interbank Offered Rate) is one of five critical financial benchmarks in the European Union (Commission Implementing Regulation (EU) 2019/482). WIBOR is the interest rate benchmark for the vast majority of złoty-denominated commercial loans, more than 98% of Polish mortgage loans, 26% of the total nominal value of Polish bonds, and € 366 billion in notional amount of OTC interest rate derivatives. It applies to financial instruments with a value greater than Poland’s gross national product.

As a critical benchmark, the methodology for determining WIBOR must be transitioned to comply with the Benchmarks Regulation (BMR – Regulation (EU) 2016/1011 of the European Parliament and of the Council), the same as the most prominent benchmarks subject to this process – EURIBOR®, EONIA® and LIBOR. Poland’s benchmark administrator, GPW Benchmark S.A., recently announced its proposed transition plan for the determination methodology for WIBOR, based on an analysis of the economic, statistical and legal consequences of transition.

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Another step forward towards the collective redress mechanism in the Czech Republic

Last year, the Czech Ministry of Justice published a draft Act on Class Actions (“Act”), which was created in the aftermath of European Commission’s proposal to enact a directive on representative actions. Although the European Commission’s proposal is aimed at boosting consumer protection in the European Union, the Czech draft Act goes one step further and aims to provide access to collective redress to a broader group of individuals. During the last few months, the draft Act was subject to an interdepartmental commenting procedure within the government as well as to the scrutiny of professionals in both public and private sectors. The Ministry of Justice received a considerable amount of criticism, which highlighted the possibility of the misuse of class actions for the purposes of competitive fights. As the legislative procedure continued, the Ministry reflected some of the concerns in the new draft Act, which is now being reviewed by the Government Legislative Council. The Ministry expects the draft Act to be presented in the current state to the Chamber of Deputies of the Czech Republic in October 2019. Continue Reading

Final Amended Version of Renewable Energy Sources Act in Poland is Now Pending the President’s Signature

On August 2, the Senate – the upper house of the Polish Parliament – passed the law amending the Renewable Energy Sources (RES) Act and certain other laws, which is now pending the President’s signature. We addressed this issue in our posts published on June 7, 2019 and June 11, 2019. Compared to the drafts discussed in the previous posts, there have been several material changes which may potentially have a bearing on the business. What is particularly hazardous for investors still using the green certificate support is the amendment, which briefly appeared at the commissions stage, introducing a maximum total price per MWh of energy and on property rights. Thankfully, it has been removed from the wording of the act in the course of the legislative process.

Once the act has been signed by the President and published in the Journal of Laws, it will come into effect within 14 days. Continue Reading

Data privacy update for Poland – July 2019

Recently the Polish regulator (UODO) published the updated list of processing operations which require a data protection impact assessment – the consequence of the EDPB’s objection to the original “black list” published by UODO back in 2018. Additionally, UODO prepared detailed guidelines on the duties of controllers in connection with data breaches under the GDPR, to be followed by controllers in case of data incidents. More about that in Magdalena Gad-Nowak’s post in the Data Privacy & Cybersecurity blog. The post also summarizes a very interesting, yet controversial, recent decision of the Supreme Administrative Court, which found that license plate numbers do NOT constitute personal data. Enjoy!

Dividing Companies by Separation – Divided Company Now Held Liable in Poland

Corporate SplitThe liability of divided companies for the obligations of acquiring or newly incorporated companies under division by separation has given rise to controversy and debate within the legal doctrine in Poland. The legislation in force before March 1, 2019, did not provide the creditors of dividing companies with much protection.

Since March 1, 2019, under amended Article 546(1) of the Code of Commercial Companies (CCC), it has been possible to attribute joint liability to the acquiring or newly incorporated companies as well as the divided company – a milestone for the legal transactions practice. It now provides sufficient protection for the divided company’s creditors, who previously had limited effective means to control asset shifts under division by separation, which caused creditors to doubt that the transactions were secure.

The ratio legis of the amended regulation was, according to the rationale for the bill, to guarantee that the interests of the divided company’s creditors are adequately protected. The previous wording of Article 546 of the CCC did not expressly provide for any liability on the part of the divided company for the acquiring companies’ obligations. Therefore, the dividing company could shift its liabilities (or debts) to less solvent entities, while leaving the assets with the dividing company. Given the absence of express joint liability on the part of the divided company for the debts transferred to the acquiring company, the so-called profit and loss centers could have materialized, thus rendering it impossible for creditors to satisfy their claims. As stipulated in the CCC, creditors have only limited participation in the company division procedure. In the legislator’s assessment, it was necessary to lay express legal foundations for joint liability on the part of the divided company for the obligations shifted to the acquiring companies, which will better protect creditors’ interests.

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Poland and the US Sign a Memorandum of Understanding Concerning Strategic Civil Nuclear Cooperation – What Can We Expect?

Poland and the US signed the Memorandum of Understanding (MoU) on strategic civil nuclear cooperation on June 12. The MoU emphasizes the desire to establish a deeper bilateral strategic relationship aiming at energy security and meeting Poland’s clean energy needs. These aims are to be achieved by:

  • Collaboration for developing Polish infrastructure for the responsible use of nuclear energy and technologies
  • Adoption of best practices in nuclear safety, security and independent regulatory oversight
  • Exploration of cooperation across the breadth of existing and future US reactor technologies, fuel, equipment and services
  • Identifying a pathway to Poland’s development of a civil nuclear program, including addressing commercial challenges such as financing and workforce development

In a prior post (Poland’s New Energy Policy Until 2040 Goes Nuclear), we described the development of nuclear energy as one of the key elements of the new Polish Energy Policy until 2040. This plan focused on the planned 6,000-9,000MW of generation by nuclear power plants (NPPs). Although we are still waiting for the final version of this Energy Policy until 2040, with the signing of the MoU, Poland appears to be taking further steps to follow the Polish Energy Policy 2040 goals. Continue Reading

Renewable Energy Sources Act Amendments in Poland – Additional Arrivals to Governmental Legislation Center in June, Continued

Things are gaining momentum. In our post of June 7, 2019, we wrote about the major changes to the draft Renewable Energy Sources Act (RES) posted on the government website on June 5. Not long thereafter, a new supplemented version 6 appeared. We believe one new development is worth our attention.

By Way of Introduction, Freezing Energy Prices in Poland in 2019

It is no secret that energy prices presented to entrepreneurs in Poland skyrocketed toward the end of 2018, and Parliament fast-tracked the law, “freezing” the prices for entrepreneurs for 2019. It may go without saying, but artificially affecting the energy sector in a free-market economy is futile for a very simple reason: the future reality check will be all the stronger. Continue Reading

Digital Constitution passes the first round in the Chamber of Deputies of the Czech Republic

Recently, legislators in the Czech Republic made an important step towards strengthening the rights of natural and legal persons as “clients of public authorities” to the provision of services by public authorities in the form of digital services. The draft Act on the Right to Digital Services (“ARDS”), also called “Digital Constitution”, presents a revolutionary approach to communication with the public authorities, and has been greeted with great acclaim by the general public. Continue Reading

Draft Amendments to the Renewable Energy Sources Act in Poland announced on Governmental Legislation Center

Mixed-race-man-checking-solar-panels

Under Pressure 

On 5 June, the draft amendments to the Renewable Energy Sources Act (RES Act) were posted on the Governmental Legislation Center website. It is no secret that Poland will not meet the RES energy production level targets imposed by EU Directives, regardless of the means undertaken. Despite this, one positive is that the government is at least trying to make the investors’ lives (and project performance) easier, save some of the ready-to-go projects and make the gap as small as it can be. Many of the draft amendments are rational and desirable to the industry. As a result, the volumes for the upcoming 2019 auctions have already been increased significantly.

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Employees go voting in CEE – what you need to know as HR professional

EU Question Mark

Between 23 and 26 May 2019, more than 400 million European citizens will have the right to vote in the European Parliament elections. This is where the similarities between the CEE countries seem to end. Voters in the Czech Republic will be voting on 24 and 25 May 2019, in Slovak Republic on 25 May and, finally, in Poland on 26 May 2019, as elections in Poland are organized on a typically non-working day.

In the 2019 elections, voters in Poland will elect 51 Parliament members, voters in Czech Republic 21 and voters in Slovakia will elect 13 Parliament members. These numbers may increase if the UK leaves the EU.

So what do you need to know about the elections as an HR professional in CEE? We have rounded up the most common questions below. Continue Reading

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