POLISH UPDATE – Polish protection of strategic companies and new rules of administering state assets
Legal restrictions concerning companies operating in certain strategic sectors of the economy and state companies were enacted in Poland. The Polish regulations track similar limitations already functioning in some other countries in the European Union and elsewhere. Under these restrictions, the Polish authorities can object to numerous transactions involving companies deemed to be key entities. A planned transaction was blocked for the first time on this basis in late 2016. On 1 January 2017, new rules also entered into force concerning trading in shares belonging to companies in which the State Treasury holds an ownership stake, providing among things for a requirement to include limitations on alienation of share rights in the articles of association of the companies in question. The scope of these limitations is broad and the consequences of violating them are severe. First and foremost, failure to follow the procedure provided for a transaction involving a key company will render the transaction void. Violation of restrictions on alienation of shares held by state companies included in the company’s articles of association will not invalidate the transaction but will expose the persons involved in the transaction to liability in damages.