The arbitrability of corporate disputes has long been a controversial issue in Poland. Recent changes in Polish law introduced by the Act of 31 July 2019 aimed to resolve the issues surrounding and give the green light to arbitrating corporate disputes. Unfortunately, it seems that these amendments have failed to solve all of the problems and have even created additional uncertainties.
A recent Supreme Court case touched on the obligations of an arbitral tribunal which cannot base its award on party-appointed experts' opinions. In a controversial decision, the court clarified that in such cases, when both parties request a tribunal-appointed expert, the tribunal should allow such a motion and cannot merely decide against the motioning party, as this may cause it to violate its obligation to consider the case, which – according to the Supreme Court – is part of public policy.
It is obvious to arbitration practitioners that an arbitral award cannot deal with claims not brought before a particular tribunal. However, it is also clear that vacating an award due to a violation of public policy should be an exceptional measure. The Supreme Court recently dealt with these two principles and leaned towards the former, setting aside a domestic award granted for interest for a different period than the one demanded by the claimant in the proceedings.
In post-arbitral proceedings, parties challenging an unfavourable award or its enforcement often argue that they were deprived of the right to present their case or that the tribunal violated the rules of procedure or committed some other procedural error and often request the state courts to order the tribunal to present the arbitral case file. A recent Supreme Court decision evaluated the usefulness and necessity of granting such requests and clarified that such measures should be granted only rarely.
Parties unhappy with an arbitration award often try to question its enforcement based on public policy, raising numerous violations of law that do not amount to public policy. However, public policy is a tool that can also protect the legal system in certain situations. Two interesting Katowice Court of Appeals decisions made on the same day by the same judge in two non-related cases demonstrate how the courts deals with collusion cases.
Parliament recently introduced the simple joint stock company to the Commercial Companies Code. This change aims to provide a simpler and cheaper option than standard joint stock companies regarding company formation, operation and liquidation and a more modern and flexible company model with a legal personality that will be particularly attractive to start-ups. However, the introduction of this new type of company has provoked divergent opinions.
The legislature recently introduced a regulation on e-financial statements. As a result, all financial reports submitted by Polish companies (with the exception of entities preparing financial statements in compliance with the international accounting standards) must be drawn up electronically using files with an '.xml' extension as defined by the Ministry of Finance. Polish companies should take appropriate steps to mitigate the potential risks and comply with this revolutionary regulation as soon as possible.
The Commercial Company Code allows representation by a supervisory board or proxy appointed by a resolution of a shareholders' meeting in contracts or disputes between companies and their management boards. In this context, the Supreme Court recently examined whether a limited liability company should be represented by a general partner or its management board when amending a limited partnership agreement, despite the fact that the limited partner was a member of the company's management board.
Appealing against shareholders' resolutions is one of the most controversial areas of Polish company law. A recent Supreme Court resolution found that the shareholders' resolution of a limited liability company could not be annulled by the courts just because it was contrary to the company's articles of association. This resolution appears to put an end to many years of controversy.
The Code of Commercial Companies provides that the supervisory board of a limited liability company cannot give binding instructions regarding the management of the company's affairs to its managers. As there is no similar explicit provision prohibiting a shareholders' meeting from issuing such instructions, the question arises as to whether this was an intentional omission by the legislature and whether managers of limited liability companies must follow instructions given by shareholders.
The Supreme Court recently explained that the Office for Competition and Consumer Protection does not have to identify all of the parties to an anti-competitive vertical agreement in decisions issued in such cases. This matter has been the subject of debate in Poland for some time, with some commentators viewing it as a possible violation of an organiser's right to a defence. It is evident from this judgment that such arguments will be unsuccessful in the courts.
The Constitutional Tribunal recently analysed regulations regarding dawn raids carried out by the Office for Competition and Consumer Protection and ruled that the respective law is not in line with the Constitution insofar as it excludes the possibility to challenge rulings allowing searches to be conducted. As a result, the Competition Act will be amended to provide searched undertakings with the possibility to appeal against Circuit Court consent to conduct searches.
One year has passed since the Act on Counteracting the Unfair Use of Contractual Advantage in the Trade of Agricultural and Food Products entered into force. The act aimed to protect small farmers and grocery suppliers against the abuse of power by large supermarkets and chain stores. The government recently adopted an amendment to the act which will allow the Office for Competition and Consumer Protection to intervene in cases involving smaller farmers.
Merger control is one of the Polish Office for Competition and Consumer Protection's main areas of activity, as it deals with 170 to 220 filings annually. Recent notable developments in this regard include proceedings initiated against Gazprom and its five partners involved in the financing and construction of the Nord Stream 2 gas pipeline and the unconditional approval of Cyfrowy Polsat's takeover of Netia.
Almost eight months after the Act on Counteracting the Unfair Use of Contractual Advantage in Trade of Agricultural and Food Products came into effect, the Office of Competition and Consumer Protection (OCCP) issued a decision regarding Cykoria SA's abusive practices. The case was closed with a commitment decision, which is unlikely to be appealed. Therefore, the courts will not provide their assessment of the OCCP's interpretation of some of the vaguer terms used in the act.
The Act of 27 October 2017 amending the Personal Income Tax (PIT) Act, the Corporate Income Tax Act and the Flat Income Tax on Certain Revenues Performed by Individuals Act amended the PIT Act to introduce categories of creative activity which entitle authors to settle 50% of their tax deductible expenses and doubled the annual limit of tax deductible expenses. Following doubts over the shortcoming of the amendments, the legislature decided to remedy their scope.
The Act of 4 July 2019 – which amended the Code of Civil Procedure and other acts, including Poland's labour and social security law – has received significant attention. Among other things, these amendments have introduced pre-trial proceedings and permit the courts to order employers to continue to employ a worker until proceedings are concluded, not only if termination of employment is considered ineffective, but also when the worker has been reinstated in their job.
A number of significant changes to Polish labour law have been announced in recent months. This article examines these amendments in detail, including changes to the Labour Code, remuneration for vocational training and apprenticeships, an increase in the minimum wage rate, the abolition of limits on retirement and disability insurance contributions and changes to social benefit fund contributions.
Social security contributions in Poland are significant, particularly in the case of highly paid managers. As a result, it is common practice for managers to perform their duties as self-employed persons under management contracts. A recent Supreme Court decision confirmed that management contracts can still be performed by self-employed managers and that such business activity constitutes a basis for social security insurance if the manager is not a management board member.
The Supreme Court recently ruled that an employer can demand that an employee inform it of any additional activities that he or she undertakes during the employment period. If the employee fails to do so, this can justify his or her employment contract being terminated upon notice. The judgment confirms the court's existing position in this regard. However, the court's second conclusion concerning data protection is new and may raise doubts regarding its compliance with the Labour Code.
The Act Amending the Act on the Employment of Temporary Workers and Certain Other Acts recently entered into force. It introduces important changes and limitations concerning temporary work and aims to improve the temporary work market and counteract abusive practices. The amendment concerns all employers that hire temporary workers.