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Anti Crisis Shield - i.e. Special Act in its final shape


10.04.2020

Anti Crisis Shield - i.e. Special Act  in its final shape

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1. CHANGES IN TAXES

  • Applications for reliefs in the payment of taxes and tax arrears
  • The Minister of Finance’s right to refrain from charging particular taxes
  • Tax loss deducted “retroactively”
  • Income tax advances charged in March and April 2020
  • Deduction of donations given to counteract COVID-19
  • PIT and CIT bad debt relief for the debtor
  • Payment to a bank account outside the White List
  • Limits of targeted exemptions in PIT
  • PIT exemptions
  • Postponing the deadline for “tax on revenue from buildings”
  • Single depreciation write-downs
  • Resignation from simplified tax advances in 2020
  • R&D relief
  • Change in the CIT-8 return filing deadline
  • Suspension of deadlines for transfer pricing information
  • Changes in VAT

 

Applications for reliefs in the payment of taxes and tax arrears

In the case of applications for tax payment reliefs being deferment of the payment deadline or division of tax liabilities or tax arrears into instalments, the legislator resigned from charging a prolongation fee (currently 4% of the amount of the tax or tax arrears). The fee exemption covers only the taxes that constitute the state budget income (PIT, CIT, VAT, excise tax). In the case of local taxes and fees, the prolongation fee will continue to be charged.

The prolongation fee exemption will also apply to social security contributions that are mandatorily charged by the Social Security Office (ZUS) for the period from January 2020 onwards (see below for more details).

In order to take advantage of the prolongation fee, an appropriate application must be submitted during the state of epidemic or within 30 days after it is cancelled.

 

The Minister of Finance’s right to refrain from charging particular taxes

The Minister of Finance was granted the right to refrain by way of a Regulation in full or in part the charging of default interests on tax arrears, bearing in mind the duration of the state of epidemic threat and the state of epidemic in connection with COVID-19 and consequences it caused. Currently there are no regulations in place.

 

Tax loss deducted “retroactively”

An opportunity was introduced to deduct the 2020 loss from the 2019 income, where the taxpayer’s 2020 revenues are lower by at least 50% than the revenues generated last year. In 2021, when the 2020 loss will have been known, taxpayers will be able to file adjusted returns for 2019 and make a single deduction of that loss - no more than PLN 5 million - from the 2019 income. If this opportunity is not taken, the loss may be settled based on the previous principles.

 

PIT advances charged in March and April 2020

Advances on account of PIT, charged in March and April 2020, will be payable by 1 June 2020. This rule applies to revenue derived from occupational relationship, employment relationship, home-based work, co-operative work relationship, revenue from business activity carried out personally under mandate contracts (umowa zlecenia) and specific-task contracts (umowa o dzieło), as well as revenues generated from copyright and neighbouring rights, and social insurance benefits.

 

Deduction of donations given to counteract COVID-19

An opportunity was introduced to deduct from the tax base the COVID-19 counteraction donations given from 1 January to 30 September 2020 to specific medical entities (e.g. hospitals), Material Reserves Agency (ARM), and the Central Base of Sanitary and Anti-Epidemic Reserves.

In the case of a donation given:

  • up to 30 April 2020 – 200% of the donation amount is deductible;
  • in May 2020150% of the donation amount is deductible;
  • from 1 June to 30 September 2020 100% of the donation amount is deductible.

In order to take advantage of the new preferences, donations should be granted only to medical facilities that are named on the lists of directors of particular National Health Fund’s Voivodship branches (made available on the branches’ websites).

 

PIT and CIT bad debt relief for the debtor

A possibility is given for debtors not to show unpaid liabilities while calculating income tax advances. Combined conditions to use it is a drop by at least 50% of revenues in relation to the corresponding period of the preceding year, as well as suffering adverse economic consequences caused by COVID-19. The bad debt relief available to the creditors is unchanged.

 

Payment to a bank account outside the White List

During the state of epidemic threat and the state of epidemic, the deadline of notification about a payment made to a bank account that is not included on the “White List” is extended to 14 days. It is counted from the date of the money transfer order.

 

New limits of targeted exemptions in PIT

New limits are introduced for targeted exemptions in PIT for:

  • allowances paid from company funds or intercompany trade organization to employees belonging to this organization - up to PLN 3,000 during 2020 (an increase from the previous limit of PLN 1,000);
  • allowances received from other sources following individual misfortunes, natural disasters, long-lasting illness or death – up to PLN 10,000 during 2020 (an increase from the previous limit of PLN 6,000);
  • cash and tangible benefits received by the employee in connection with the financing of social activity referred to in the regulations applicable to the Company Fund of Social Benefits (ZFŚS), financed in full from the resources of the Fund or from the trade unions’ funds – up to PLN 2,000 during 2020 and 2021 (an increase from the previous limit of PLN 1,000). The exemption does not cover vouchers, coupons and other media of exchange that entitle the holder to exchange them for goods or services;
  • additional payments from sources other than the social fund or the Company Fund of Social Benefits for the recreation of children and youth up to the age of 18 organized by entities carrying out business operations in this respect, in the form of holidays, summer and winter camps, including those combined with education, therapeutic treatment in spas, or in spa & therapeutic facilities, rehabilitation & training facilities, therapeutic & care facilities; as well as for travel connected with such recreation and therapeutic stay – up to PLN 3,000 during 2020 and 2021 (an increase from the previous limit of PLN 2,000).

 

Downtime benefit, lodging and board – PIT exempt

In the case of non-agricultural sole traders, individuals carrying out an agency contract, mandate contract or another service agreement, unless they are subject to social security under other titles, the downtime benefit paid out in 2020 will be exempt from income tax.

Similarly, income tax exemption will apply in the case of an employer’s performance consisting in providing the employee with lodging and board in 2020 needed to perform employment obligations.

 

Postponing the deadline for “tax on revenue from buildings”

The deadline for paying the tax on revenue derived from buildings is postponed for the months March-May 2020 until 20 July 2020. The combined conditions to take advantage of this possibility are as follows:

  • decrease by at least 50% of revenues relative to the corresponding period of the preceding year and
  • suffering adverse economic consequences caused by COVID-19.

 

Single depreciation write-downs

The possibility was introduced to make single depreciation write-downs on the initial value of fixed assets acquired for the production of goods connected with counteracting COVID-19, i.e. protective masks, ventilators, sanitizers, and they were introduced to the records of fixed asset and intangible assets in 2020.

 

Resignation from simplified tax advances in 2020

The possibility was introduced for small taxpayers to resign from the simplified method of paying advances on account of tax for the months March-December 2020. The basis for calculating the advances will be the revenue actually generated in 2020. The taxpayer should notify the authorities about his resignation from simplified advances in the annual return filed for 2020.

 

R&D relief

The R&D relief will be able to be settled as early as in the advances on account of income tax for businesses carrying out research and development work, the purpose of which is development of products to counteract COVID-19.

A preferential rate of 5% will apply for IP Box as early as in the advances on account of tax on income derived from qualified intellectual property rights used to counteract COVID-19.

 

Change in the CIT-8 return filing deadline

The deadline to file the CIT-8 return and to pay the tax by CIT payers is extended utill 31 May 2020. For taxpayers who only earned income subject to targeted exemptions or where the revenue earned from public benefit operations constitutes at least 80% of their total revenue, the filing and payment deadline is extended until 31 July 2020.

 

Change in the deadline to prepare and submit certain tax information

The deadline is extended until the fifth month after the tax year end for drawing up and submitting information about contracts executed with non-residents within the meaning of foreign exchange law (the extension applies in the period 31 March - 31 May 2020) and until the end of the fifth month of the year following the tax year for the remitters providing non-residents with information about the disbursements made and the fixed-rate income tax charged (the extension applies to entities whose tax year ended between 31 December 2019 and 31 January 2020).

 

Suspension of deadlines for transfer pricing information

The deadline for submitting transfer pricing information is extended until 30 September 2020 for related parties whose financial year (under the CIT Act) or tax year (under the PIT Act) started after 31 December 2018 and for whom the original 9-month deadline to file transfer pricing information passes on 29 September 2020.

For the other related parties, i.e. those whose financial year (for CIT) or tax year (for PIT) started after 31 December 2018 and for whom the original 9-month deadline to file transfer pricing information passed  on 30 September 2010  or later, the 9-month deadline is retained.

 

Changes in VAT

The direct amendments to the VAT Act and those introduced to the VAT Act in amendment Laws cover:

  • Deferment of the obligation to submit the new JPK_VAT file (return plus record) from 1 April 2020 to 1 July 2020 for all taxpayers.
  • Change in the date of introducing a new matrix of VAT rates into 1 July 2020. Until 30 June 2020 the to-date VAT Act and secondary regulations thereto will apply in respect of using decreased tax rates.
  • Postponement until 1 July 2020 of deadlines connected with the protective force of Binding Rate Information (WIS).
  • The possibility to issue a recorded sale receipt in the cash register in paper form or electronically (without the need to print it out).

 

2. CHANGES IN SOCIAL SECURITY OFFICE (ZUS)

  • Payment of contributions
  • Exemption from contributions
  • Contribution calculation basis
  • Prolongation fee
  • Others

Payment of contributions

Where benefits are granted to co-finance the remuneration of employees covered by economic downtime or shortened working time standard, the employer is entitled to funds from the Fund of Guaranteed Employment Benefits (FGŚP) to be used for payment of employees’ social security contributions (in the part financed by the employer) due on the performances they receive. A similar right is vested in entrepreneurs whose turnover dropped as a result of COVID-19, in non-governmental organizations, and in entities referred to in article 3 section 3 of the Act on Public Benefit Activity and Voluntary Service of 24 April 2003, provided they receive co-financing for part of the cost of employees’ remunerations.

 

Exemption from contributions

Entrepreneurs who:

  • filed as at 29 February 2020 for the insurance of fewer than 10 insured,
  • started their business operations before 1 February 2020,
  • in the first month for which an application is filed to be relieved from contributions - generated a revenue of no more than 300% of the forecast average gross remuneration in 2020 (in the case of sole traders who pay contributions only for their own insurance), i.e. no more than PLN 15,681 (PLN 5,227 x 3),

may apply until 30 June 2020 to the Social Security Office (ZUS) to be released from the obligation to pay the outstanding social security and health insurance contributions for the period 1 March - 31 May 2020.

 

Contribution calculation basis

The value of lodging and board needed for the employee to perform his employment obligations, which the employer is obliged to provide where:

  • the employees’ working time system or schedule is changed so as to ensure the continuity of functioning of a business entity or a station or an authority (this applies first of all to businesses ensuring the functioning of critical infrastructure systems and facilities, their key subcontractors and suppliers, and businesses ensuring the functioning of liquid fuel stations and natural gas stations) or,
  • employees are instructed to work overtime to the extent and within the time standard needed to ensure the continuity of functioning of a business entity or station (applies to the entities as above),

is not included in the basis of calculating social security contributions.

 

Prolongation fee

Where the payment of contributions is deferred or their amount is divided into instalments, in the case of contributions due from 1 January 2020 onwards, based on an application filed during the state of epidemic threat, state of epidemic, or within a period of 30 days following its cancellation - no prolongation fee is charged.

Others

  • If a deadline to issue decisions or pay benefits by ZUS falls during the state of epidemic threat, state of epidemic, or within a period of 30 days after its cancellation, then if this deadline is not kept ZUS will not have to pay statutory interest for the delay.
  • Individuals covered by pension and disability insurance within the meaning of the Act on Social Insurance of Farmers of 20 December 1990, are released from contributions payable for such insurance for the second quarter of 2020.
  • The following obligations are imposed on the remitters of contributions and natural persons ordering specific tasks:
    • to inform ZUS about the execution of each specific-task contract (umowa o dzieło) with an individual with whom they do not remain in an employment relationship, or where no work is provided under such contract to the employer with whom they remain in an employment relationship - within 7 days from such contract being executed (a model notice will be determined by way of a Regulation) and,
    • to record information concerning the executed specific-task contracts referred to above on the contribution remitter’s account.

 

3. TAX CODE

  • Individual tax rulings
  • MDR (obligations connected with submitting tax schemes)
  • Release from real estate tax
  • Suspension of deadlines applicable to tax proceedings

 

Prolongation of deadlines to issue tax rulings

Interpretation cases initiated by an application to issue a tax ruling before the Special Act entered into effect or before the epidemic ends will be prolonged by 3 months. The Minister of Finance is also entitled to extend the deadline to issue an individual tax ruling by subsequent periods, however no more than by 3 months (thus, de facto, taxpayers may have to wait for a new ruling for 6 months). Without a doubt, this change is not favourable from the perspective of taxpayers awaiting a ruling that has a material impact on a decision e.g. about adjusting a(n) (annual) return.

 

MDR (obligations connected with submitting tax schemes)

The deadlines connected with domestic tax schemes will not start running, and those commenced will be suspended from 31 March 2020 until the state of epidemic threat and the state of epidemic is cancelled, no later than on 30 June 2020.

 

Release from real estate tax

In terms of real estate tax, the legislator authorised municipalities to introduce exemption for part of 2020 from real estate tax charged on: land, buildings and structures connected with business operations, applicable to indicated groups of entrepreneurs whose financial liquidity deteriorated in connection with adverse economic consequences caused by COVID-19. Municipalities are to determine the exemption period at their discretion.

In addition, the Municipality Council may by resolution extend deadlines to pay real estate tax due in April, May and June 2020, no later than until 30 September 2020.

In the case of natural persons, this solution will apply to the tax instalments payable by 15 May, and in the case of legal persons - tax instalments payable by: 15 April, 15 May and 15 June 2020.

 

Suspension of deadlines applicable to tax proceedings

Statutorily, deadlines applicable to limitation periods are suspended for litigation and court proceedings, including inspections and proceedings carried out under the Tax Code, customs and fiscal audits, court and administrative proceedings, and penal fiscal proceedings.

Undoubtedly, for fear of the virus spread, actions such as hearing witnesses, site inspections, explanations provided by parties, would not be carried out anyway. However, this should not obscure the fact that a case that is not handled swiftly may be in some cases unfavourable for the taxpayer who might e.g. wait for a final decision favourable to him and is complaining about the lengthy/tardy proceedings.

 

4. LEGAL CHANGES - LABOUR LAW

  • Co-funded employment benefits
  • Co-funding provided contractually by the county head (starosta)
  • Admissibility to enter into special agreements on using less favourable employment conditions

 

Co-funded employment benefits

Entrepreneurs who as a result of COVID-19 show a drop in business turnover will be entitled to receive co-financing for employment benefits in order to retain places of work, provided from the Fund of Guaranteed Employment Benefits (FGŚP) in the case of:

1. economic downtime, i.e. a period during which the employee refrains from work due to reasons beyond his control and during which he remains ready for work;

2. shortened working time standard.

The drop in business turnover, being a condition for the support, is deemed to be decreased sales of goods or services in terms of the quantity or value (Note: these are alternative prerequisites; a month is also deemed to be 30 consecutive days):

1. by no less than 15% calculated as the ratio of the total turnover in any 2 consecutive calendar months falling between 1 January 2020 and the day preceding the submission of the co-financing application, to the total turnover of the corresponding 2 consecutive calendar months falling in the preceding year; or

2. by no less than 25% calculated as the ratio of the turnover in any indicated calendar month between 1 January 2020 and the day preceding the submission of the co-financing application, to the turnover in the preceding month.

Possible funding:

1. in the case of economic downtime (for a period of maximum 3 months from the date of the agreement on disbursement of the benefits, which term may be extended by a Council of Ministers Regulation):

  • the employer is entitled to decrease remuneration by no more than 50%,
    however to an amount not being lower than the minimum remuneration for work, i.e. PLN 2,600,
  • co-funding is possible from the Fund of Guaranteed Employment Benefits (FGŚP), at a level of 50% of the minimum remuneration for work, i.e. PLN 1,300,
  • FGŚP may cover social security contributions payable by the employer on the benefits granted, which in total means a total co-funding of PLN 1,533.09 per person;
  • there is no co-funding for an employee’s remuneration - earned in the month preceding the co-funding application filing date - the amount of which was higher than 300% of the average monthly remuneration in the previous quarter announced by the President of the Central Statistical Office (GUS) based on the regulations on old-age pensions and disability pensions from the Social Security Fund (FUS) and applicable as at the application filing date, which average remuneration was PLN 5,198.52 for the 4th quarter, this meaning that there is no co-funding for remunerations exceeding PLN 15,198.52.

2. in the case of shortened working time standard:

  • the employer may shorten the working time standard by 20%, no less than down to 0.5 of the full-time work, with this reservation that remuneration cannot be lower than the minimum remuneration for work, i.e. PLN 2,600,
  • co-funding is possible from FGŚP up to an amount being half the remuneration arising from the shortened working time standard, no more than by 40% of the average monthly remuneration in the previous quarter announced by the President of the Central Statistical Office and applicable as at the co-funding application filing date, i.e. bearing in mind the 4th quarter 2019 data - in a maximum amount of PLN 2,079.43,
  • FGŚP may cover social security contributions payable by the employer on the benefits granted, which in total means a total co-funding of PLN 2.452,27 per person;
  • there is no co-funding for an employee’s remuneration - earned in the month preceding the co-funding application filing date - the amount of which was higher than 300% of the average monthly remuneration in the previous quarter announced by the President of the Central Statistical Office (GUS) based on the regulations on old-age pensions and disability pensions from the Social Security Fund (FUS) and applicable as at the application filing date, which average remuneration was PLN 5,198.52 for the 4th quarter, this meaning that there is no co-funding for remunerations exceeding PLN 15,198.52.

For the purposes of the aforesaid solutions, the notion of an “employee” refers to:

  • individuals remaining in employment relationships under employment contracts,
  • individuals hired under home-based work contracts, mandate contracts or other service contracts (civil-law contracts),
  • individuals providing gainful work based on relationships different from the employment relationship, for employers being a farming production co-operative or another co-operative dealing with agricultural production.

 

Co-funding provided contractually by the county head (starosta )

As an alternative to the opportunity of using employees’ remunerations co-funded from FGŚP, micro, small and medium enterprises will be able to obtain co-funding from the county head (starosta) for a part of costs of employees’ remunerations and social security contributions payable on those remunerations.

The co-funding may be granted for a period not to be longer than 3 months where the economic turnover drops as a result of COVID-19.

If this funding is granted, the entrepreneur will be obliged to keep the employees in the contractual number over the co-funding period plus a period equal to that after the co-funding ends.

If this condition is violated, the entrepreneur will have to return the co-funding pro rata to the period during which the employee was not retained.

 

Admissibility to enter into special agreements on using less favourable employment conditions

The employer whose business turnover decreased as a result of COVID-19 may:

1. limit the uninterruptible rest time during 24 hours from 11 hours to 8 hours, and the
uninterruptible rest time during a week from 35 hours to 32 hours (guaranteeing at the same that an equivalent rest time will be awarded to the employee within a period of 8 weeks);

2. execute an agreement introducing an equivalent working time system, where it is admissible to prolong the 24-hour working time standard up to no more than 12 hours, within a reference period that does not exceed 12 months; the extended daily working time standard is balanced by a shorter daily working time standard on certain days or by non-working days;

3. execute an agreement on using less favourable employment conditions than those arising from the employees’ employment contracts, to the extent and for a term specified in the agreement.

The agreements referred to in points 2 and 3 above – provided there is no trade organization functioning at the employer’s place – are executed by the employer and representatives of the employees appointed in the manner accepted at the given employer's facility.

 

5. RENTAL OF SPACE IN SHOPPING CENTRES

 

  • Expiry of mutual obligations of parties to the rental agreement
  • Prolongation of the rental (lease or similar) agreement once the trading ban is lifted
  • Possibility to modify the aforesaid solutions based on the Civil Code
  • Others

 

Expiry of mutual obligations of parties to the rental agreement

During the time of the ban on business operations carried out in trading facilities having sale areas over 2,000 m2, the mutual obligations expire of the parties to the rental (lease or similar) agreement based on which the commercial area is provided for use. As a result, the tenants will not be obliged during the said period to make any performances to the landlord, which were provided in the tenancy agreement, which includes the rent, service charges and potential contractual penalties.

 

Prolongation of the rental (lease or similar) agreement once the trading ban is lifted

The tenant should place with the landlord an unconditional and binding declaration of intent to prolong the agreement term based on the to-date conditions by the period of the ban plus six months. The offer should be made within three months from the ban being lifted.

If no such declaration is made within the said period, the regulations concerning the expiry of the parties’ mutual obligations will cease to be binding on the landlord, i.e. - as should be concluded despite certain impreciseness of this regulation, which may give rise to interpretation doubts – the mutual receivables of the parties arising from the executed rental (lease or similar) agreement will have to be settled for the period of the ban on the operations in the given Shopping Centre.

 

Possibility to modify the aforesaid solutions based on the Civil Code

The said solutions that envisage the expiry of mutual obligations during the ban on business operations in shopping centres and an appropriate prolongation of the rental agreement do not prejudice the Civil Code regulations, which were specified as provisions governing the obligation relationship of the parties in situations in which certain legal restrictions are introduced on the freedom of business operations. This phrase is not explicit, however it should be concluded that it refers to the retention by the parties of their right to bring a court action for a claim under article 3571 of the Civil Code, which court may, having considered the parties' interests, in accordance with the principles of community life, designate the manner of performing the obligation, the value of the performance or even decide that the contract be dissolved.

 

Others

In addition, with respect to all the rental (lease) agreements, the following changes were introduced:

  • The possibility to prolong a rental agreement for residential or non-residential premises (executed before the anti-crisis shield entered into effect) until 30.06.2020 by way of the tenant’s unilateral statement, subject to exceptions where such prolongation is inadmissible.
  • Limited possibility to give to the tenant of residential or non-residential premises a notice of termination under a rental agreement in general or with respect to the rent, until 30.06.2020, subject to exceptions where such a notice will be admissible.
  • The possibility to extend the notice period under a residential premises rental agreement in general or with respect to the rent until 30.06.2020 where a notice terminating the residential premises rental agreement - in general or with respect to the rent - had been given by the landlord before the anti-crisis shield entered into effect and the notice period ends after that date but before 30 June 2020. The notice period is prolonged based on the tenant’s declaration of intent, which should be made at the latest on the date on which the termination notice period ends. The anti-crisis shield provides for certain cases where the notice period prolongation will not be possible.
  • Simplified procedure enabling the cancellation, deferment or division into instalments of the State Treasury receivables under legal relationships the subject of which are real properties comprising the State Treasury resources, due for leasing, renting or using real properties (as well as receivables due under the said titles to a local government unit or its organizational entities), for the period of the state of epidemic threat or the state of epidemic – at the request of an entity whose financial liquidity deteriorated in connection with suffering adverse economic consequences caused by COVID-19. This support will constitute state aid.
  • Prolongation of the deadline to pay an annual fee for perpetual usufruct / for transformation of perpetual usufruct of land into ownership - up to 30 June 2020. The anti-crisis shield extended the deadline for paying the annual perpetual usufruct fee for the year 2020 and the transformation fee for converting perpetual usufruct into ownership due for the year 2020, from 30 March 2020 to 30 June 2020. This extension was made statutorily and it does not require any applications to be filed or statements to be made. In addition, with respect to the annual perpetual usufruct fee, a possibility was introduced to extend the said period by way of a Council of Ministers Regulation.

 

6. CHANGES IN OPERATION OF BUSINESS ENTITIES

 

  • Electronic communication between company authorities and resolutions adopted remotely
  • Postponed deadline to adopt a resolution on the remuneration policy in public companies
  • Postponed deadline to implement employee capital plans (PPK) for medium enterprises
  • Postponed deadline of submissions to the Central Register of Beneficial Owners (CRBR)
  • Repealing to some extent regulations restricting trading on Sundays
  • Authorizations of the President of the Competition and Consumer Protection Office (UOKIK) to impose penalties on entrepreneurs violating regulations on maximum prices
  • Suspension of fees charged by organizations of collective management of copyright or neighbouring rights, and suspension of subscription fees
  • Suspension of substantive and procedural deadlines 
  • Possibility to modify loan repayment conditions for SMEs
  • Cancellation of the time limit to have financial statements audited by an auditing firm
  • Declarations of intent made by members of legal person’s authorities
  • Financial statements
  • Changes in the functioning of authorities in a co-operative

 

Electronic communication between company authorities and resolutions adopted remotely

The amended regulations of the Code of Commercial Companies (“CCC”) enable management board and supervisory board meetings, shareholders’ meetings and general meetings to be held electronically by way of means of distance communication. The new regulations will apply provided that such a possibility was not excluded in the articles of association; detailed principles of such communication will be specified in appropriately adopted rules of meetings of particular authorities.

With respect to shareholders’ meetings or general meetings convened before the Anti-Crisis Shield Law entered into effect together with the amendments to the CCC - they can be held electronically, in which case notifications should be given as appropriate for such a shareholders’ meeting or general meeting being convened, no later than 4 days prior to the planned meeting date.

 

Postponed deadline to adopt a resolution on the remuneration policy in public companies

The Minister of Finance may by way of a Regulation defer the deadline to adopt by the general meeting of a public company a resolution on the policy of remunerations for management board and supervisory board members.

 

Postponed deadline to implement employee capital plans (PPK) for medium enterprises

The deadline to execute an agreement on operating employee capital plans (PPK) is postponed by half a year for employers hiring between 50 and 249 individuals in accordance with the headcount as at 30.06.2019 (“2nd wave of PPK”). This means that the deadline to choose a financial institution and execute a management agreement therewith was postponed from 24 April to 27 October 2020, and the deadline to execute an agreement on operating PPK was postponed from 11 May to 10 November 2020.

 

Postponed deadline of submissions to the Central Register of Beneficial Owners (CRBR)

The deadline for submitting data about beneficial owners is to be prolonged for commercial companies entered in the Polish Court Register (KRS) before 13 October 2019 - by 3 months, i.e. until 13 July 2020.

 

Repealing to some extent regulations restricting trading on Sundays

The ban on trading activities consisting of unloading, accepting and displaying essential goods is temporarily lifted, which also means that such activities can be entrusted to an employee or a hired individual on Sundays other than working days.

 

Authorizations of the President of the Competition and Consumer Protection Office (UOKIK) to impose penalties on entrepreneurs violating regulations on maximum prices

Where an entrepreneur violates (even involuntarily) - multiple times or for multiple goods or services, or at a large scale - the ban on setting prices or margins higher than maximum, the UOKIK President may impose thereon a cash penalty of no more than 10% of the turnover.

 

Suspension of fees charged by organizations of collective management of copyright or neighbouring rights, and suspension of subscription fees

During the state of epidemic threat or the state of epidemic, the organizations ZPAV, ZAiKS, STOART, SAWP, SFP and ZASP will not charge from business entities fees determined as being directly dependent on the entity’s actual revenue or income for its provision of services within the given period. Nor will the RTV subscriptions be charged.

 

Suspension of substantive and procedural deadlines 

Certain periods provided for in administrative law or court and procedural periods will not start running, or if commenced will be suspended, for the period of the state of epidemic threat or the state of epidemic announced due to COVID-19.

 

Possibility to modify loan repayment conditions for SMEs

For bank loans and other loan facilities granted to micro, small and medium enterprises before 8 March 2020, the bank may change the loan conditions in consultation with the entrepreneur; such change being justified by the assessment of the borrower’s financial and business situation carried out by the bank no earlier than on 30 September 2019.

 

Cancellation of the time limit to have financial statements audited by an auditing firm

Auditing firms will be able to audit financial statements of public interest entities for longer than 5 years (however not longer than 10 years).

 

Declarations of intent made by members of legal person’s authorities

Meetings of legal persons’ authorities can be held by means of electronic communication without the need for the authorities’ members to be present simultaneously, while a declaration of intent of a member of a legal person's authority may be made in documentary form (e.g. by e-mail), however irrespective of specific regulations such declarations may be made without the authority member’s identity having to be additionally verified (e.g. by qualified or hand signature).

 

Financial statements

The Act on Counteracting and Combating COVID-19 (the Anti-Crisis Act) provides for the possibility to extend by way of a Minister of Finance Regulation the deadlines arising from the Accounting Act and concerning e.g. submissions of financial statements.

In accordance with the Minister of Finance Regulation of 31 March 2020 on the determination of other deadlines for performing recording obligations and on the preparation, approval, publication, and submission of financial statements or information to an appropriate register, unit or authority, the deadlines for preparing and approving financial statements are extended by 3 months; in the case of entities subject to supervision by the Polish Financial Supervision Authority - by 2 months.

 

Changes in the functioning of authorities in a co-operative

A member of the supervisory board or of the management board will be able to request convening a supervisory board or management board meeting giving the proposed agenda, or to request adopting a specific resolution in writing or by way of means of direct distance communication.

A resolution of a co-operative’s authority (management board or supervisory board) can be adopted if all the members in the authority were correctly notified about the authority being convened or about voting in writing and by way of means of direct distance communication. The quorum calculation should include the members participating by casting a vote in writing or with the usage of means of direct distance communication.

In addition, the deadline to convene a general meeting of a co-operative or a meeting of flat owners is extended by 6 weeks from the date of the state of epidemic being cancelled.

 

7. COMMERCIAL CONTRACTS

 

  • Contracts executed under the Public Procurement Law
  • Maximum prices
  • Tourism industry – trip organization contracts

 

Contracts executed under the Public Procurement Law

The parties to contracts executed under the Public Procurement Law may agree on changing performance deadlines and/or scope, temporarily suspending contract performance, increasing the economic operator’s fee by no more than 50% of the original contract value, due to adverse impact of COVID-19 on the capacity to perform the contract by either party.

Refraining from charging contractual penalties and from claiming compensation for undue performance of the contract will not constitute a violation of the discipline of public finances.

The contractual parties will be obliged to take a stance within 7 days about the other party’s position as to changing the contractual conditions.

Circumstances caused by the epidemic do not constitute independent grounds for exercising the contractual right of rescission.

 

Maximum prices

The minister appropriate for economic matters will be able to determine by way of a Regulation maximum prices or maximum wholesale and retail margins used in the sale of goods or services being of material importance for healthcare and/or security of humans and/or for costs of maintaining households.

The application by business entities of higher prices or margins will be prohibited, otherwise a penalty of up to PLN 5 million may be imposed by appropriate state inspection authorities, with the possibility of attaching to such decision a writ of instantaneous enforceability. 

 

Tourism industry – tourist event organization contracts

In the case of travel agents, both parties to the contract on organizing a tourist event will be able to rescind the contract.

Instead of cash return, the travel agent’s client may accept a voucher having at least the same value, which can be used for a period of 1 year after the date on which the original event was to take place.

The cash retained by travel agents on account of the vouchers is subject to protection against being seized in the case of the travel agent’s insolvency.

Business entities managing hotels and organizers of events or exhibitions will be obliged to return the amounts paid by their clients within 180 days.

The client may accept a voucher having at least the same value, which can be used for a period of 1 year after the date on which the original event was to take place.

 

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