The Polish Government recently adopted a draft act on the so-called Anti-Crisis Shield 4.0 (the Act) aimed at counteracting the negative effects of the COVID-19 pandemic. The Act includes provisions introducing, i.a., restrictions for certain foreign investments in Polish companies, and as such follows the trend taken by the European Union Commission and other member states.
The restrictions are to apply for 24 months from the date the Act enters into force. The Polish Parliament is expected to commence formal works on the Act on 27 May 2020. Below we present a brief summary of the restrictions.
Which investors are affected?
The Act introduces certain restrictions in relation to investments contemplated by investors from outside the EU/EEA
What kind of investments will be subject to the contemplated restrictions?
The Act introduces a comprehensive definition of investments whereby the restrictions are triggered as follows:
What type of companies will be protected?
The Act introduces a wide scope of investments in Polish companies which will be subject to the restrictions, provided that their annual turnover for each of the last two years exceeds EUR 10 million, which will include, i.a.,:
What is the screening procedure?
The screening procedure foreseen in the Act is modelled on the current procedure for antimonopoly clearance. As a rule, the relevant authority (the Polish Office of Competition and Consumer Protection) must be notified prior to any acquisitions triggering the restrictions.
The procedure consists of two stages:
What are the consequences of not following the new restrictions?
Apart from the acquisition being null and void, not complying with the procedures as foreseen in the Act may result in fines of up to PLN 50 million, or imprisonment of between six months and five years.