Poland's legal system is based on the civil law tradition. The Polish legal system underwent substantial changes between 1989 and 2004, to accommodate the transition to a free-market economy and the implementation of EU legislation, and has continued to evolve.

The basic legislative framework for business activities in Poland is currently provided by the Civil Code of 1964, the Commercial Companies Code of 2000 and the Act on Entrepreneurs of 2018. The Act on Rules of Foreign Entrepreneurs' and Other Foreign Persons' Involvement in Trading in Poland of 2018 covers foreign investment.

Courts

The Polish Constitution of 2 April 1997 vests judicial powers in:

• the Supreme Court;
• the common courts (district, regional and appeal courts;
• the administrative courts (provincial administrative courts and the Supreme Administrative Court); and
• military courts.

The judicial order is based predominantly on the common courts. The role of the administrative courts is to control the activity of the public administration.

Proceedings before a common court generally consist of two stages (although extraordinary cassation appeals to the Supreme Court are available in certain circumstances). The first stage of civil proceedings is conducted in a district court, whose rulings may be appealed before a regional court. However, where a case is heard by a regional court in the first instance, it is appealed before an appeal court.

The Supreme Court's role is to ensure uniformity and accuracy of interpretations of the law, and to issue opinions on statutes.

In general, foreign investment in Poland does not require special approval from the authorities. As a member state of the EU, Poland applies the principles of free movement of capital and non-discrimination. Therefore, investors from EU, European Economic Area (EEA) or European Free Trade Association (EFTA) member states may invest according to the same principles as Polish citizens, and are not treated as foreigners.

However, in order to enjoy the same rights as Polish citizens, foreign investors need to meet certain criteria – eg, obtain a residence permit in Poland. Otherwise (save for where international treaties provide differently), an investor may only participate in a limited liability company, joint stock company, limited partnership or partnership limited by shares.

Moreover, there are limitations on foreign equity participation with regard to some sectors of the economy, such as aviation and radio and television broadcasting.

Limitations

Certain limitations apply regardless of the investor's origin, with regard to certain regulated activities where a concession, licence or registration in the register of regulated activities may be required. If so, the relevant regulatory bodies may be authorised to revoke licences for state security interest reasons. In some sector regulations, the regulators have the express right to revoke a licence upon change of control.

Consents

Some consents (eg, antitrust approval or consent of the Polish Financial Supervisory Authority to acquire certain stakes in a bank or certain other, regulated financial institutions) may be required, regardless of whether the investor is foreign or domestic.

The government may also veto investment in specific strategic Polish companies in protected sectors (the regulation currently applies to 24 named companies but may change at the government's discretion). The same restrictions apply to domestic investors investing in strategic Polish companies on the list, so this is not a typical foreign direct investment (FDI) regime.

FDI Regime

The FDI regime was introduced in response to the COVID-19 pandemic and applies to foreign investors as follows:

• in the case of natural persons – persons who are not citizens of an EU/EEA/OECD country; or
• in the case of other entities – entities that do not have their registered office in an EU/EEA/OECD country and/or entities that have not had their registered office in an EU/EEA/OECD country for at least two years.

This regime also applies to indirect acquisitions by foreign investors. The list extending the application of the rules is broad and includes the following in particular:

• acquisitions made through subsidiaries;
• acquisitions made at the request of a foreign investor (including acquisitions by investment portfolio managers made for their clients); and
• acquisitions made by entities acting in concert with a foreign investor.

An FDI transaction is one that results in a foreign investor acquiring:

• a stake equal to or greater than 20% or 40% of the total number of votes in a Polish company or, in the case of a Polish partnership, making a contribution to a Polish partnership equal to or greater than 20% or 40% of the total contributions in the partnership;
• a participation in the profit of a Polish company equal to or greater than 20% or 40%; or
• a significant participation in, or a dominant position over, a Polish company – eg, via the acquisition or lease of an organised part of the enterprise from a Polish company, entering into a control (management) agreement and/or a profit transfer agreement in relation to a Polish company or acquisition of a majority of votes in a Polish company.

If the FDI transaction concerns a company that operates in any “strategic” sectors or conducts “strategic” activities, it is subject to the FDI regime and requires prior clearance from the Polish Competition Authority (PCA) for filings made before 24 July 2025, or from the ministry responsible for economic affairs for filings from 24 July 2025 onwards.

The regime affects the following:

• companies that conduct economic activity across a wide range of sectors, including energy, science, technology, telecommunications, medicine and food produce;
• companies active in the development or modification of software across sectors including energy, water, science, technology and commerce, food supply, and all software – regardless of sector – that is used for data gathering and processing;
• companies that own “critical infrastructure” (as defined in a separate act); and
• all Polish public companies listed on the Warsaw Stock Exchange, regardless of the sector in which they operate.

A de minimis exemption applies for Polish target companies with Polish revenue below EUR10 million in either of the two financial years preceding the notification. Furthermore, the Polish government is entitled to introduce additional exemptions.

Permit to Acquire Real Property

The acquisition of real property (including the so-called perpetual usufruct right in real property) by foreigners requires a permit from the minister of the interior and administration. This restriction also applies to the acquisition of shares by a foreigner where this results in the takeover of control over a company owning real property and to the purchase of shares in a company owning real property that is a controlled entity. In general, agricultural land may only be purchased by individual farmers; all other entities must first obtain permission from the president of the National Agriculture Support Centre, and this is subject to the fulfilment of strict requirements.

Therefore, regulatory requirements, if any, must always be double-checked at an early stage of the preparations for a proposed investment.

General

Where a permit issued by the minister of the interior and administration is required for the acquisition of real property or shares in companies that own real properties, acquisition without such a permit will be null and void. It may take several months to obtain a permit; the actual duration of the proceedings may vary depending on the circumstances.

In respect of certain sectors, where the formal consent of the regulator is not required but a change in the shareholding would trigger certain rights for the regulator, it is usually recommended, where feasible and practicable, for the proposed investor to introduce itself to the regulator before making the investment in order to determine whether the investment would raise any concerns for the regulator.

In addition, a failure to notify the acquisition of a dominant/significant participation in protected Polish companies listed by name in the governmental regulation could lead to both criminal sanctions (from six months to five years of imprisonment) and financial penalties (PLN100 million).

FDI Regime

Procedure

The approval of the relevant authority is generally required prior to the completion of an FDI transaction (although in some instances the filing can be made only by the target entity after completion of the acquisition). The notification procedure should be commenced prior to:

• entering into any agreement resulting in an obligation to acquire or achieve a significant participation/dominance;
• the acquisition of a Warsaw Stock Exchange-listed company, prior to announcement of the tender offer; or
• any other event resulting in the acquisition or achievement of a significant participation/domination.

However, in a multi-stage transaction, notifications are accepted before the signing of the last agreement resulting in the acquisition or achievement of a significant participation/domination, on the basis of, for example, a conditional/preliminary agreement or a letter of intent.

Following the notification, the authority has 30 business days to complete the initial proceedings and approve the FDI transaction or initiate additional control proceedings, which may last up to 120 calendar days. However, the authority may extend this deadline substantially by asking questions, as the clock stops ticking each time the authority sends out its question, to resume only when the response is actually delivered to it. There is no pre-notification procedure.

Sanctions

Any FDI transaction made in breach of the FDI regime will be null and void, and the investor will not be able to exercise its rights attached to the acquired shares (including any voting rights).

Non-compliance with the FDI regime constitutes a criminal offence subject to a penalty of imprisonment from six months to five years and a fine of PLN50 million. A penalty of imprisonment from six months to five years and a fine of PLN5 million may also be imposed on managers of target companies who fail to notify the authority of the shareholders’ non-compliance with the FDI regime, and on those who attempt to exercise voting rights in breach of the FDI regime.

While the authorities do not make approval conditional upon certain commitments, some commitments will usually be required if an investor (whether foreign or domestic) applies for state aid for its investment.

Certain regulators (eg, the Polish Financial Supervisory Authority) expect various specific commitments from both foreign and domestic investors who wish to acquire large stakes in regulated financial institutions.

There is no specific authorisation procedure; however, where licences, concessions and permits are required, they are granted in administrative proceedings and any unsatisfactory decision may be challenged.

In contrast to regular competition law proceedings before the PCA (where one may appeal to a special court), the FDI regime will follow the standard administrative appeal route; appeals will be decided by administrative courts.

Foreign investors usually operate in Poland through one of the available domestic entities. However, it is not uncommon for investors (especially from the EEA) to register an overseas company as having a branch or representative office in Poland, without incorporating a new Polish legal entity.

The choice of an appropriate legal form usually depends on the nature of the contemplated business.

Most Common Forms of Legal Entities in Poland

Limited liability company

A limited liability company (spółka z ograniczoną odpowiedzialnością, or sp. z o.o.) is the most popular form of corporate vehicle in Poland, which can be established for nearly all business purposes, except in situations where the applicable law requires another form of legal entity (only a joint stock company can be listed on the stock exchange). The minimum share capital of a limited liability company is PLN5,000, and the nominal value of one share may not be less than PLN50. There is no minimum number of shareholders, so the company may have only one shareholder. However, the company may not be formed by another sole-shareholder limited liability company.

The governance structure includes the following corporate bodies.

Management board

The management board manages the affairs of the company and consists of at least one member appointed from among the shareholders or outsiders. Unless the articles of association provide otherwise, the members of the management board are appointed and dismissed by way of a resolution passed by the shareholders' meeting.

Shareholders' meeting

The shareholders' meeting makes the decisions on the company's most crucial affairs, as stipulated in the articles of association or in the Commercial Companies Code, which distinguishes between “ordinary” and “extraordinary” shareholders' meetings. The first must be held within six months of the end of each financial year and should adopt resolutions to approve:

• the management board report;
• the financial statement for the previous financial year;
• the distribution of profits or financing of losses; and
• the discharge of duties by members of the company's corporate bodies.

Supervisory board

A supervisory board or audit committee is optional as long as the company's share capital does not exceed PLN500,000 and there are no more than 25 shareholders; if appointed, it must be composed of at least three persons. The role of the supervisory board is to exercise day-to-day supervision over all areas of the company's activity. It may give the management board instructions, but they are not binding. The audit committee's duties are limited to reviewing the financial statements and the management board's motions to distribute profit and cover loss.

The shareholders of a limited liability company are not personally liable for the company's liabilities. The company is treated as a legal entity separate from its shareholders, so the shareholders may lose only their investment in the company.

A limited liability company is quite a flexible vehicle, suitable for numerous purposes.

Joint stock company

In general, a joint stock company (spółka akcyjna, or S.A.) is quite similar to a limited liability company in its three corporate bodies (the general meeting, the management board and the supervisory board), which share most characteristics and competences. The fundamental difference is that a joint stock company may raise its capital by public subscriptions and issue shares in the form of securities, so the form is usually used by businesses intending to raise capital through an IPO or when Polish law requires this form of company (eg, in the case of financial institutions, banks, pension funds and insurers).

Boards

The management board deals with the company's affairs, and members are appointed and removed by the supervisory board, unless the statutes provide otherwise. Some issues listed in the Commercial Companies Code or the statutes require resolutions adopted by the general meeting.

A supervisory board is a requirement in a joint stock company. Its role is to monitor the company's activities and review the financial statement and management report on company activity. Its members are appointed by the general meeting, but the statutes may provide otherwise. In principle, the supervisory board acts collegially, but it may also delegate certain activities.

Shareholders

Shareholders are not liable for the company's liabilities. The minimum share capital of a joint stock company is PLN100,000, and the nominal value of one share may not be less than PLN0.01. All shares in joint stock companies are dematerialised (ie, no share certificates are in place going forward). Each share transfer becomes effective upon registration in the shareholders' register, and shareholders are no longer able to remain anonymous.

There is no minimum number of shareholders, so the joint stock company may have only one shareholder. However, it may not be formed by a sole-shareholder limited liability company.

Simple joint stock company

A simple joint stock company (prosta spółka akcyjna, or P.S.A.) is a new type of corporate vehicle. It is intended to be suitable for start-ups, as the founder will not be obliged to obtain the amount needed for share capital and the shares can be subscribed for in exchange for any contribution that has economic value, in particular the provision of labour or services (prohibited for other companies). It cannot, however, undergo an IPO. 

Governing bodies

Corporate governance in a simple joint stock company may be based on either the two-tier model (similar to a limited liability company) or the one-tier model (only a board of directors is appointed, on which there are executive and non-executive directors).

Shareholders

The minimum share capital is PLN1 and all shares are dematerialised (ie, there are no share certificates). The shares have no par value, do not form part of the share capital and are indivisible. There is no minimum number of shareholders, so the simple joint stock company may have only one shareholder. However, similar to other Polish companies, it may not be formed by a sole-shareholder limited liability company. The shareholders are not liable for the company's liabilities.

Subject to a few exceptions (eg, a change in the statutes, mergers and demergers), shareholders’ meetings may take place outside Poland, and minutes do not need to be drawn up by a notary public. Therefore, holding a shareholders’ meeting is less burdensome than for joint stock companies.

Less Common Types of Corporate Vehicles in Poland

General partnership

A general partnership (spółka jawna, or sp.j.) is a basic type of partnership. Although it does not have a legal personality, it has the capacity to acquire rights, incur debts, sue and be sued.

It is managed and represented by its partners. In principle, each of the partners is entitled to deal with the general partnership's affairs and represent it; however, the partnership deed or a resolution of the partners may provide that the partnership is managed by one or several partners. Moreover, the management of the partnership may be entrusted to third parties, but not in a way that excludes all the partners.

Decisions on matters beyond the ordinary scope of the partnership's business require the consent of all the partners (including those with a limited right to manage it). Regardless of such limitations, all the partners have the unlimited right to be informed of the state of the partnership's assets and its business, and the right to review its books and documents. All the partners are jointly and severally liable for the general partnership's debts, but this liability is subsidiary – ie, the partnership's creditors should first seek satisfaction from the partnership's assets. If that proves ineffective, they may institute enforcement against a partner's assets. The partners' liability may not be limited.

There is no minimum share capital requirement in a general partnership, but it must have at least two partners. Most often, a general partnership is used when a large amount of capital is not required, the partners wish to have a personal impact on the business and the business itself is not risky.

Professional partnership

A professional partnership (spółka partnerska, or sp.p.) is designed for certain groups of freelancers (such as lawyers, doctors, tax advisers and architects) for the purpose of exercising their professions in a partnership. Only natural persons licensed to practise their professions may be partners in a professional partnership, which must have at least two partners.

Each partner has the right to manage the partnership's affairs individually. In addition, the professional partnership may be managed and represented by a management board, modelled on the one in a limited liability company. At least one of the partners must sit on the board.

The partners' liability is similar to that in a general partnership, but the partners are not liable for the partnership's obligations arising in relation to the practice of professions by the other partners or resulting from acts or omissions of the partnership's employees who are supervised by another partner. As in a general partnership, there is no minimum share capital requirement.

Limited partnership

In a limited partnership (spółka komandytowa, or sp.k.), there are two groups of partners:

• general partners who have unlimited liability; and
• limited partners whose liability is limited.

The status of the general partners is similar to the status of partners in a general partnership; they represent the limited partnership and manage its affairs. Limited partners may represent the partnership only on the basis of a power of attorney granted by the partnership; although management of the partnership is the general partners' right and duty, decisions on matters exceeding the ordinary scope of the partnership's business activity require the consent of the limited partners as well.

The general partners are liable for the partnership's obligations to the extent of all their personal assets, whereas the limited partners are liable up to the declared limited contribution (suma komandytowa). There is no minimum share capital requirement. A limited partnership must have at least one partner who is the general partner and at least one partner who is the limited partner.

Partnership limited by shares

A partnership limited by shares (spółka komandytowo-akcyjna, or S.K.A.) is a combination of a joint stock company and a limited partnership, and has two corporate bodies:

• the general meeting; and
• the supervisory board.

A partnership limited by shares does not have a management board; instead, it is managed and represented by the general partners. However, certain matters listed in the Commercial Companies Code or partnership deed require the resolution of a general meeting.

Both the general partners and the shareholders participate in the general meeting, but only the latter are entitled to vote. A supervisory board is not mandatory unless the partnership has more than 25 shareholders, and must have at least three members. Once appointed, the supervisory board exercises permanent supervision over the partnership's activities.

The general partners' liability is unlimited, whereas the shareholders are not liable for any of the partnership's debts and may lose only their investment in the partnership. The minimum share capital of a partnership limited by shares is PLN50,000, and the nominal value of one share may not be less than PLN0.01. From 1 March 2021, all shares in a partnership limited by shares are dematerialised. A partnership limited by shares must have at least one general partner and at least one shareholder. Most often, a partnership limited by shares is used in atypical venture capital/private equity investments.

Other forms

Other forms are also available, such as a co-operative (spółdzielnia), a European company (Spółka Europejska, or Societas Europea) or foundations (fundacja).

The family foundation (fundacja rodzinna) was introduced in May 2023, and should be considered as a mechanism of succession by owners of medium and large family businesses or owners of private assets of significant value. A family foundation may carry out business activities such as joining commercial companies, taking out loans or buying and selling shares or securities.

All legal entities must be registered in the National Court Register. There are two ways of establishing the companies – ie, traditional and electronic. Family foundations are registered in a separate register.

Traditional Establishment

The process begins with signing the articles of association or deed of formation. For companies and limited partnerships or partnerships limited by shares, the articles of association or statutes must be executed before a Polish notary public in the form of a notarial deed.

The next step is to file an application to enter the company in the National Court Register, which usually takes several weeks. A partnership is established upon registration. Companies come into existence upon the conclusion of the articles of association, but receive legal personality upon registration.

Electronic Establishment

General partnerships, limited partnerships and companies may be established electronically through a special internet portal, in which case there is no requirement to draft the articles of association in the form of a notarial deed. Instead, they are concluded based on the template provided in the system.

However, the template has basic wording and any amendments to it must be in the form of a notarial deed and must be registered with the court. This method of incorporation is usually simpler and faster than the standard procedure, especially for SPVs, but it is not always suitable for more complex investments,.

Polish private companies and partnerships are subject to disclosure obligations, which are of an informational nature.

Companies are obliged to notify the registry court of any changes to information disclosed in the register, such as:

• the composition of their decision-making bodies;
• rules of representation;
• registered office and address;
• the amount of share capital; and
• the names of their shareholders or partners.

Companies must also report any amendments made to the articles of association. Applications to the registry court are filed electronically.

After the end of each financial year, a company must file approved financial statements, the management board's report on the company's activity and the auditor's opinion (if required). Currently, these financial documents are only filed electronically.

Companies are obliged to electronically file declarations with the Central Register of Beneficial Owners to record or update the company's beneficial owners.

Reporting Duties

Ongoing tax and employment-related reporting duties will also apply (eg, in respect of taxes and various social security contributions). Certain additional reporting duties vis-à-vis the National Bank of Poland may apply regarding foreign exchange transactions and other financial matters, for example. The company will usually be expected to provide certain data to the statistical authorities, on a periodic basis.

Depending on the type of business, certain other ongoing duties will apply (eg, waste disposal or other duties related to the environment). If regulated, other regulatory duties may also apply.

Under Polish law, there is a two-tier management structure. The management board manages a company's affairs and has executive directors, whereas the supervisory board (with non-executive directors) or, less commonly, the audit committee monitors its activities. Please see 3.1 Most Common Forms of Legal Entity for more details.

Each officer of the company is obliged to act in its interests and is liable to the company for any damage caused by acts or omissions in breach of the law or articles of association. Members of the corporate bodies are liable for any damage caused by lack of required diligence in the course of performance of their functions or a breach of the duty of loyalty towards the company, resulting in the damage.

The members of the management board (and directors of the simple joint stock company) may be jointly and severally liable for the company's debts in terms of all their assets if enforcement against the company proves ineffective (ie, if the company's assets are insufficient to cover the claims). However, a member of the management may be released from this liability in certain circumstances – for example, if they can prove that a petition to have the company declared bankrupt was filed in due time (or delayed without their fault).

As the burden of proof will rest entirely with the management board member, it may sometimes be very difficult for the member to succeed in being released from liability. Similar rules regarding the personal liability of management board members apply to taxes and certain other public charges. Finally, a breach of certain duties (eg, reporting duties) may also trigger criminal liability.

In practice, the members of the management board (as executive directors) are more exposed to each type of liability than the members of the supervisory board (as non-executive directors), which is worth considering when deciding on the structure and composition of the boards. Polish law does not currently recognise the concept of “piercing the corporate veil”, and attempts to introduce the concept have so far been unsuccessful. As it stands, shareholders are liable to the company only to the extent that they fail to make agreed contributions or that they receive unlawful distributions, or under the general principles of tort law.

A major amendment to the Commercial Companies Code came into force on 13 October 2022, changing the rules on the liability of members of the corporate bodies and introducing a regulated group concept and related holding company law. A member of the management board or supervisory board is not liable for damage caused to the company when acting within the limits of a justified economic risk on the basis of information, analyses and opinions that should be taken into consideration in the relevant circumstances. However, this does not override the duty to act with professional due diligence and loyalty to the company, which applies to the members of the management board and supervisory board of a limited liability company and a joint stock company.

The right of a parent company to issue a binding instruction to a subsidiary was also introduced. However, under certain circumstances a subsidiary is entitled to refuse to carry out the instruction issued. The members of the management board, the supervisory board or audit committee and the liquidators of a subsidiary and a parent company are exempt from liability for damage caused by the execution of a binding instruction if they acted in the interest of the group. Accordingly, the liability of the parent company is correspondingly enhanced, creating the possibility of holding a parent company liable for damage caused by its binding instructions given to a subsidiary, the minority shareholders of a subsidiary or the creditors of a subsidiary. Establishment of the group and, therefore, application of these regulations is not mandatory.

Employment regulations are contained in a number of legal sources, including statutes of law, collective bargaining agreements and other collective arrangements based on statutes and regulations issued by the employer. Statutory employment laws are of a semi-imperative nature, which means that other provisions regulating terms of employment – such as collective bargaining agreements, other collective arrangements and internal regulations – may modify statutory provisions, but only for the benefit of employees. Modifications to the employees' detriment will be ineffective. The same applies to individual employment contracts.

An employment contract should be signed in wet ink or with a qualified electronic signature (QES), although failure to satisfy this requirement does not result in the invalidity of the contract – an employment contract is also valid and enforceable when concluded orally or even per facta concludentia. However, where the contract has not been concluded in writing or with a QES, the employer is obliged to confirm to the employee the arrangements regarding the parties to the contract, the type of contract and the conditions of the contract in writing prior to admitting the employee to work. Any change to the terms of employment should also be made in writing. A unilateral change that is detrimental to the employee requires notice of change to conditions of work and pay (in writing or signed with a QES). If the proposed new conditions are rejected by the employee, this results in the termination of the employment contract.

Polish law provides for three types of employment contracts, based on whether the contract is concluded for:

• a probationary period;
• a fixed term; or
• an indefinite term.

The purpose of a probationary period contract is to verify an employee's suitability for the given position. It may be concluded for a maximum period of one, two or three months, with the maximum period depending on the type and duration of contract the parties intend to conclude subsequently. It is possible to extend the probationary period by periods of holidays and any other justified absences. The contract for a probationary period can, in principle, be concluded only once in relation to a specific position.

A fixed-term contract can be concluded for a maximum of 33 months. The duration of subsequent fixed-term contracts concluded with the same employer is calculated in aggregate for that purpose. No more than three subsequent fixed-term contracts may be concluded; if these limits are exceeded, the contract automatically becomes a contract for an indefinite term. The law provides for certain exceptions where the limits may be exceeded without the contract becoming a contract for an indefinite term, including the conclusion of a contract for a term of office or a situation where the employer can objectively justify exceeding the limit.

Employees may work full-time or part-time, and there are no minimum working hours. The standard full-time working hours provide for eight hours of work a day and 40 hours a week. These limits may be modified based on the system and work time schedule adopted. However, the average weekly working time may not exceed 48 hours, including overtime, in a settlement period. The employer must also ensure minimum periods of uninterrupted rest – ie, a minimum of 11 hours per day and 35 hours once a week.

Overtime work is, in principle, permitted for the employer's justified needs or the need to carry out a rescue action. Overtime should not exceed 150 hours annually, but the employer may modify this limit to up to 416 hours per annum.

Employees are entitled to their regular remuneration plus an addition of 50% or 100% of their salary for overtime work, depending on the type: the higher addition applies if overtime work is performed at night, on a Sunday or a holiday, or on a day off granted to the employee for work on a Sunday or holiday, and also for every hour of overtime exceeding the weekly limit of working hours (ie, 48 hours). Instead of an addition to remuneration, employees may be compensated for overtime work by time off in lieu.

Employment contracts may be terminated with or without notice or by a termination agreement. The length of the notice period depends on the type of contract and the duration of employment. For employment contracts for a fixed or indefinite term, the notice period is:

• two weeks if the period of employment lasted less than six months;
• one month if the period of employment lasted at least six months but less than three years; and
• three months if the period of employment lasted at least three years.

Termination by the Employer

To terminate a fixed-term or an indefinite contract, the employer must state the reason for termination in the termination notice. The reason must be real, specific and serious enough to justify termination. Moreover, the employer must consult the trade union representing the relevant employee (if present) on the intention to terminate the contract, although the employer is not bound by the opinion of the trade union.

Some categories of employees are protected from termination – eg, employees who are of pre-retirement age or pregnant. It is also generally not admissible (with some limited exceptions) to give notice of termination while an employee is on holiday or on sick leave. There is no obligation to make any additional payments to an employee whose contract is being terminated with notice (apart from regular remuneration until the end of the notice period and payment in lieu of holiday leave), except where the termination takes place due to redundancy, in which case the employer is required to pay statutory severance pay of one, two or three months' remuneration (depending on tenure). The statutory severance rules apply only to employers with 20 employees or more.

The employer may terminate an employment contract without notice through the fault of the employee in the following circumstances:

• severe violation of basic employee duties;
• committing a crime that makes it impossible to continue employment in a given position; and
• loss of qualifications to perform work in a given position through the fault of the employee.

The employer may also terminate the contract without notice without the fault of the employee if the employee remains on sick leave for a certain period (longer than three or nine months, depending on the duration of employment) or where the employee's justified absence for other reasons lasts longer than one month. There is no obligation to make any additional payments to the employee in the case of termination without notice.

Termination by the Employee

An employee can terminate an employment contract with or without notice. Termination without notice can take place where a doctor diagnoses a detrimental effect of work on the health of the employee and they are not transferred to another position by the employer, or where the employer severely breaches its basic duties to the employee. In the latter case, the employee is entitled to compensation in the amount of their remuneration for the notice period applicable to their contract or, in the case of a contract for a fixed term, for the remainder of the term of the contract, but for no more than the notice period.

Termination by Mutual Agreement of the Parties

The terms of termination agreements are agreed by the parties, and it is common for the employer to make an additional severance payment to the employee, although this is not a legal requirement.

Collective Redundancies

If an employer with at least 20 employees terminates employment contracts for reasons not attributable to the employees, it is referred to as “collective redundancy” if the redundancies are made during 30 consecutive days and the termination involves:

• ten or more employees, where the employer has fewer than 100 employees;
• 10% or more of the employees, where the employer has at least 100 employees but fewer than 300 employees; or
• at least 30 employees, where the employer employs 300 employees or more.

The employer is obliged to consult the trade unions (if present) regarding the intention to carry out collective redundancies, and must also notify the trade unions of the reasons for the planned redundancies, the number of employees to be made redundant and the period during which the redundancies will take place, among other things. This information must be submitted to the relevant labour office. If there are no trade unions at the employer's establishment, the relevant rights are exercised by elected employees' representatives.

Within 20 days of the date of notification, the employer must conclude an agreement with the trade unions regulating the collective redundancy process. If an agreement cannot be reached, the employer unilaterally regulates the process in the relevant by-laws. If there are no trade unions at the employer's establishment, the employer issues the by-laws after consulting the employees' representatives. The relevant labour office must be notified of the agreement concluded or the by-laws issued.

Employees whose contracts are terminated in a collective redundancy procedure are entitled to additional statutory severance pay of one, two or three months' remuneration, depending on the duration of their employment (respectively: less than two years, from two to eight years, or longer than eight years).

In principle, there is no legal requirement to have any kind of employee representation. However, a company that has more than 50 employees is obliged to inform employees that they may (but are not obliged to) set up a works council. Works councils have consultation and information rights, but they do not participate in the management of the company.

Employees of privatised companies have certain rights of representation on the supervisory board. If the company has more than 500 employees on average over the year, the employees have the right to elect one member of the management board.

Trade unions, if present at the company, retain significant influence; negotiations with trade unions may be required in some situations, particularly if there is a planned collective redundancy. In general, under Polish law, there are no requirements to negotiate or consult with trade unions or works councils when a Polish company or its assets are being acquired. However, such negotiations or information obligations are common when the company being sold is state-owned.

If there are no trade unions, in some situations the law requires the employer to inform/consult employee representatives. Employee representatives can be elected ad hoc for this purpose, or a permanent employee representation may be formed at the employer.

Personal Income Tax (PIT)

In principle, employees in Poland are subject to PIT at the rate of 12%, provided that a 32% rate applies on the portion of the taxable profit exceeding PLN120,000 in the tax year. Certain incomes are taxable at 19% or 20% flat PIT rates. Incomes from different sources are not mixed, and tax is calculated for each source of income separately.

Tax-reducing amounts apply, ranging from PLN3,600 (if the annual income is PLN120,000) to PLN10,800 (if the annual income exceeds PLN120,000). No tax is effectively payable on an annual income of up to PLN30,000.

Income of up to PLN85,528 received by a person under the age of 26 is exempt from PIT.

A limited number of reliefs and allowances may be available to employees – eg, for the use of the internet and for certain donations made to charity and/or if they have children who are:

• under 18;
• under 25 and continuing their education without having their own income; or
• disabled and receiving special benefits.

From 2022, health insurance contributions are no longer tax-deductible costs for employees. However, certain employees who create IP rights as part of their duties may be eligible for lump-sum costs at the rate of 50% of the portion of their remuneration allocated to such IP rights (provided that such costs do not exceed PLN120,000 in total).

Social Security Contributions

Health insurance contributions are paid by the employee at the rate of 9%. Social security contributions (to finance retirement, disability pensions and sick leave benefits) may total up to 29.97% – ie, 13.71% payable by the employee (as a non-deductible cost) and 16.26% payable by and tax-deductible for the employer. The basis for calculation of the retirement and disability pensions contributions is capped at PLN260,190 for 2025.

Additional occupational accident contributions and some other social security contributions payable by and tax deductible for employers may apply, depending on the circumstances and the type of business and work carried out, and the number of employees employed by the employer. Generally, the contributions amount to the following:

• for retirement – 19.52% of the basis of assessment;
• for disability pensions – 8% of the basis of assessment; and
• for sick leave benefits – 2.45% of the basis of assessment.

Social security contributions may differ slightly from the above (eg, for accident contributions, the rate varies from 0.67% to 3.33%, with the accident contribution for a small company employing up to nine people being 1.67%).

Payment of Tax and Reporting Duties

The employer is obliged to calculate and remit the tax advances to the relevant tax office, and the health insurance and other social security contributions to the Social Security Office (ZUS).

Employees are obliged to make annual tax filings (which may be done electronically). Employees who do not intend to take advantage of any allowances or deductions and who settle under the general rules (tax scale at 12% and 32% rates) and only receive income settled through a remitter (eg, employer or principal) may leave the tax settlement to the tax office.

Company Income Tax (CIT)

Legal entities in Poland are obliged to pay CIT on their income in Poland, at the rate of 19%. A reduced 9% rate applies to taxpayers in the first year of starting a business and to those taxpayers whose annual income (including VAT) does not exceed EUR2 million.

In respect of partnerships that are tax-transparent, tax is payable by partners (CIT for partners that are legal entities; PIT for individuals). Partnerships limited by shares and limited partnerships are treated as CIT payers (ie, non-tax-transparent entities), with special tax reliefs for limited partners.

The CIT Act provides for specific rules to determine whether or not an item may count as a tax-deductible cost, and expressly identifies a list of items that cannot constitute tax-deductible costs. Certain allowances and reliefs may be available (eg, a 50% allowance in respect of the acquisition of new technologies).

The tax basis is calculated separately for capital gains (as defined in the CIT Act) and other incomes.

“Minimal” CIT of 10% came into force in 2024. Therefore, an entity that has incurred an income loss (other than capital gains source) or whose tax yield in the basket of so-called operating profits does not exceed 2% is taxed at 10% of the taxable base. The CIT Act also provides for a number of other exemptions from the “minimal” tax for certain entities.

Polish CIT provides for several tax reliefs and exemptions for specific business types.

In addition, tax capital groups and entities whose revenues exceed EUR50 million are obliged to prepare and publish information about their tax strategy.

Poland implemented the Pillar 2 directive on 1 January 2025 and introduced three new taxes: a global minimum tax, a domestic minimum tax and a top-up tax on undertaxed profits. The purpose of the global minimum tax is to level the tax rules for the largest multinational companies. New obligations will be applied to domestic and international companies that are part of capital groups and had a total annual revenue amounting to at least EUR750 million in two of the last four financial years. Such companies will need to calculate their effective tax rate for this timeframe and will face additional taxes if it will fall below the 15% minimum level of taxation. The top-up tax will be the difference between the minimum rate and the effective tax rate in a particular jurisdiction.

Taxation of Sole Traders

Individuals running businesses as sole traders (for which certain requirements need to be met) may elect whether to pay taxes in the following manners:

• according to the same rules and rates as employees (except the actual tax-deductible costs, subject to statutory limitations similar to those applicable to CIT payers, would apply instead of lump sums);
• at a flat rate of 19%; or
• according to special rules, in respect of some types of smaller businesses (eg, a lump sum of 2% to 17% of gross income or by means of the so-called tax card, where the amount of tax is a lump sum payable irrespective of income or profit).

From 1 January 2022, the basis of assessment for health insurance contributions is determined depending on what type of business activity the remitter conducts and what form of taxation is applied to the income from that activity. Any person conducting business activity who pays social contributions for their own insurance was required to submit an annual health insurance contribution return for the first time in 2023. For example, for an individual running a business as a sole trader who settles tax based on a tax scale for January 2025, the lowest contribution assessment basis is PLN3,499.50, and the minimum contribution is PLN314.96.

The new amount of the minimum wage (PLN4,666) will be the lowest contribution base only for the contributions due for January 2025, and will be in effect until January 2026.

Withholding Tax

Polish income tax laws provide for withholding tax on payments made to non-Polish residents at the rate of:

• 20% on interest, royalties and certain services (eg, legal, advisory, management, data processing, HR and financial services); and
• 19% on dividends and other capital gains and interest payable to individuals on some debt instruments.

Lower rates or exemptions from withholding tax may apply if provided for under bilateral treaties. Moreover, under the provisions of the Parent-Subsidiary Directive and the Interest and Royalties Directive (which have been implemented into the Polish tax system), dividends, interest and royalties payable to a company with its registered office in an EU country are, in principle, exempt from withholding tax, provided that the company receiving the interest (its beneficial owner) holds at least 10% (in the case of dividends) or 25% (in the case of interest and royalties) of the shares in the company making such payments for at least two years. This holding period may end after the payments have been made.

The tax remitter is obliged to act with due care when verifying the requirements to apply such lower rates or exemptions on payments to a single entity of up to PLN2 million per annum.

Under the withholding tax pay-and-refund mechanism, if the total amount of “passive” payments (ie, dividends, interest and royalties) to a single taxpayer that is a related party exceeds PLN2 million in the relevant tax year, the tax remitters will be obliged to collect withholding tax on said payments on the day they are made, at the standard Polish rates (ie, 19% in the case of dividends and 20% in the case of interest and royalties) on the surplus over PLN2 million, without the possibility of waiving collection of the tax under the relevant double tax treaty and without taking into account the exemptions or reduced rates as determined under special provisions or double tax treaties.

In such a case, the taxpayer or the tax remitter (if it paid the withholding tax from its own funds and bore the economic burden of the withholding tax) may claim a withholding tax refund. However, a tax remitter may apply reduced withholding tax rates or withholding tax exemptions if:

• the tax remitter provides the tax authority with a written statement confirming (under threat of tax criminal liability for breach) that all the requirements for a lower rate or an exemption have been fulfilled; or
• a tax remitter or a withholding tax payer receives an opinion on the applicability of the withholding tax exemption from the tax authority, valid for three years.

Significant fines apply if, in the absence of an exemption, a tax remitter does not collect the statutory withholding tax.

Value Added Tax

In principle, anyone whose total sales of goods and/or services (with some sector exceptions) in the previous year exceeded PLN200,000 (provided that such threshold shall be reduced pro rata if the activity was conducted only for part of the previous year) must register as a VAT payer. The new threshold of PLN240,000 will come into force on 1 January 2026. The basic VAT rate is 23% (reduced rates of 8%, 5% or 0% may apply to some goods and services).

VAT rules are fairly strict and under some circumstances provide for the joint and several liability of members of the supply chain for its payment. Under certain circumstances, additional penalty rates of 15%, 20%, 30% or 100% may apply. An electronic accounting ledger detailing all VAT-able transactions must be submitted to the tax authorities on a monthly basis, or quarterly in some cases (VAT return).

The split payment mechanism applies to some B2B transactions, whereby the payment that corresponds to the VAT amount of the invoice is paid into a special bank account of the supplier – the VAT subaccount. This mechanism is compulsory in the case of payments for certain goods and services.

The reverse charge in VAT for the supplies of certain energy products came into force on 1 April 2023 and will remain in force until 31 December 2026.

In January 2022, the Polish Ministry of Finance introduced a National e-Invoice System, which is currently a voluntary option but will become mandatory from 1 February 2026 for entrepreneurs whose value of sales (including the amount of tax) exceeded PLN200 million in 2025, and for other entrepreneurs from 1 April 2026.

New tax provisions for VAT groups (tax-neutrality within the group) came into force in 2023.

Other Taxes

Other taxes may apply from time to time, depending on the type of business, such as property tax, excise duty, tax on civil law activities, tax on means of transport or tonnage tax.

Subject to the restrictions and limitations resulting from the EU state aid laws, some tax incentives (such as income and property tax reliefs) may be available to investors that obtain a permit to invest in the so-called Special Economic Zones.

Some tax relief may also be available for the purposes of restructuring.

A tax group that enables a participating company to be treated as a single CIT payer (and to consolidate the profits and losses of the group members) is available to Polish companies that meet the following criteria:

• the registered share capital per participating company in the group is not lower than PLN250,000 on average;
• a parent company directly holds at least 75% of the shares in the remaining group members;
• no group member is in arrears in respect of taxes;
• no group member may benefit from any tax exemptions or reliefs; and
• all transactions between the tax group members and their affiliates outside the tax group must be on an arm's length basis.

A written agreement to form a tax group for a period of no less than three tax years must be concluded and registered with the tax office. Members of the tax group are jointly and severally liable for the CIT liabilities of the group for the period during which the tax group agreement remains in force. If the status of a tax group is lost as a result of a breach of the applicable obligations, each participating company will have to adjust its tax filings for the three most recent tax years (as if the tax group did not exist) and, where applicable, settle any outstanding taxes.

Amendment to the regulation is currently in the works and is expected to come into effect on 1 January 2026.

Since 2022, taxpayers are obliged to exclude from tax-deductible costs the costs of debt financing for the part in which the excess of the costs of debt financing exceeds PLN3 million (this does not apply to debt financing costs associated with obtaining funding from a family foundation, directly or indirectly) or 30% of taxable EBITDA. In addition, the costs of debt financing obtained from affiliated entities are not regarded as a tax-deductible expense for the part in which they were earmarked directly or indirectly for capital transactions, particularly the purchase or acquisition of shares (stock), the acquisition of all rights and obligations in a partnership without legal personality, additional contributions, share capital increases or the purchase of own shares for redemption. Costs that are not deducted in a given year due to the above mechanism may be carried forward for up to five consecutive tax years.

In Poland, transactions between related parties (defined on the principle of a 25% ownership stake interpreted broadly, including not only shares but also, for example, certificates in investment funds or similar instruments) should be done on an arm's length basis. Where applicable, transfer pricing documentation must demonstrate that all relevant transactions have been executed on terms that would have been applicable to unrelated parties.

The requirement to prepare the transfer pricing documentation applies in respect of transactions with a value of:

• PLN10 million for commodity and financial transactions; and
• PLN2 million for services and other transactions not included above.

Lower thresholds of PLN2.5 million in the case of a financial transaction and PLN500,000 in cases other than a financial transaction apply to transactions with related parties based in countries that would be tax havens under the OECD rules. The transfer pricing rules include a simplification whereby a mark-up of 5% is applied to certain low-value services, such as accounting, human resources, IT services and general services of an administrative and office nature, in recognition that these services are provided at arm's length.

It is possible to obtain an advance pricing arrangement from the tax authorities.

An updated list of tax havens came into force on 1 January 2025, according to which the Principality of Andorra is no longer classified as a tax haven.

In 2016, Poland introduced rules on counteracting tax avoidance – ie, any act that satisfies both of the following conditions:

• it was effected primarily for the purpose of obtaining a tax advantage that, in the given circumstances, is an advantage contrary to the subject and purpose of tax law; and
• the party that carried out the act acted in an artificial manner.

The tax consequences of an act identified as having been effected primarily with the aim of achieving a tax advantage are determined based on the state of affairs that would have existed if an “appropriate act” had been effected. Where circumstances indicate that the achievement of a tax benefit was the only purpose of carrying out the act, the tax consequences are determined in such a way as if the act had not been carried out.

To obtain protection against the application of anti-avoidance rules in respect of a transaction in the future, a company or individual may apply for a so-called security ruling. The authority decides on the application over six months, and may refuse to issue a ruling if the application relates to a case of tax avoidance.

Mandatory Disclosure Rules

The Polish law provisions adopting mandatory disclosure rules implementing the DAC6 Directive have a broader scope than those under the DAC6 Directive, and also include some specific local Polish hallmarks mainly applicable to distributions from Poland.

As an EU member state, Poland applies the EU common customs policy, which means that all member states apply the same rules and tariff rates to countries outside the EU.

As of 2025, the EU has increased tariffs on a wide range of goods imported from Russia and Belarus, as part of EU sanctions in response to Russia's continued aggression against Ukraine and Belarus's support for the conflict, with the aim of reducing the revenue streams that could support military operations. On 17 June 2025, the European Parliament adopted a modification of customs duties applicable to imports of certain goods originating in or exported directly or indirectly from Russia and Belarus. The modification focuses on fertilisers, to which a 6.5% base tariff will be applied, plus a fee that will increase from EUR40–45 per ton to EUR315–430 per ton by 2028. The changes are planned from July 2025 to July 2028 but it is difficult to predict further changes in tariffs, due to the ongoing conflict in Ukraine.

From April 2025, a 10% tariff applies to most goods imported into the United States from EU countries. The initial 20% tariff was suspended by President Donald Trump for a period of 90 days, which was supposed to end on 9 July 2025; Trump then signed a decree extending the deadline to 1 August 2025. The EU continues to seek concessions from the United States and is trying to achieve reduced tariff rates on key products and sectors. The EU is also advocating for a reduction of the 25% tariff on automobiles and auto parts, and of the 50% tariff on steel and aluminium exports to the US. The situation remains highly uncertain and is evolving rapidly, with the final decision of the US being hard to predict.

Trade relations between Poland and China have recently become more strained. The European Commission has imposed anti-subsidy tariffs of up to 35.3% on electric vehicles imported from China. In response, China has introduced retaliatory tariffs targeting various European exports. Reports of negotiations between the EU and China appeared when trade tensions initiated by US President Donald Trump escalated.

The following transactions are subject to mandatory merger control by the PCA:

• mergers;
• acquisitions of direct or indirect control (be it sole or joint) over one or more undertakings and/or assets; and
• the creation of a joint venture (including non-full-function joint ventures).

The PCA must be notified of a transaction if the following occur in the financial year preceding the concentration:

• the combined global turnover of the parties exceeds EUR1 billion; and/or
• the combined turnover of the parties exceeds EUR50 million in Poland.

Turnover includes the turnover of each party's capital group and part of the turnover of their jointly controlled entities (but the seller's turnover is excluded). The notification obligation is triggered if either of these thresholds is met; the thresholds may be met by one party only.

Exemptions

A transaction does not have to be notified if any of the following exemptions applies:

• in the case of the acquisition of control and/or assets – if the target's turnover in Poland did not exceed EUR10 million in either of the two financial years preceding the concentration;
• in the case of mergers or the creation of a joint venture – if the turnover of any party to the merger or joint venture did not exceed EUR10 million in Poland in either of the two financial years preceding the concentration; and
• in the case of inter-related transactions (simultaneous or subsequent acquisitions from one and the same capital group of assets and/or control over an undertaking or undertakings that occur within a two-year period) – if the combined turnovers of all the acquired targets and targeted assets generated in Poland did not exceed EUR10 million in either of the two financial years preceding the most recent concentration.

In addition, there is a soft law exemption from the notification obligation in the case of extraterritorial joint ventures with no Polish operations, no plans to conduct such operations within the next three years and no vertical links with companies operating in Poland.

Other Transactions

The following transactions fall outside the merger control system:

• intra-group transactions;
• acquisitions of shares, on a temporary basis, by a financial institution or by an undertaking for the purpose of securing liabilities; and
• acquisitions of control or assets in bankruptcy proceedings (if the target does not compete with the buyer's capital group).

There is no formal pre-notification procedure in Poland, although consultations with the PCA prior to a transaction are possible. There is no statutory deadline by which a notification must be made to the PCA. However, the parties may not close the transaction until the PCA's clearance has been obtained or the statutory period for a decision to be issued by the PCA has lapsed (the standstill obligation).

As a general rule, the PCA should examine the transaction within one month of the date the merger control proceedings are instituted (Phase 1). The PCA may extend the proceedings for an additional four months (Phase 2) if:

• the case is complex;
• the transaction raises competition concerns; or
• a market survey is required.

The statutory time limit for issuing a clearance decision is suspended each time the PCA requests additional information and/or documents, and resumes only when the response is actually delivered to it.

When a proposed concentration threatens to significantly limit effective competition, the PCA informs the parties in writing of its objections to the concentration. In order to enable clearance to be given, the PCA may accept a party's proposed commitments (remedies) – eg, divestment.

Sanctions

The PCA may impose a fine on an undertaking taking part in a concentration (in the case of the acquisition of control and/or assets – only on the buyer) of up to 10% of its turnover for a breach of the standstill obligation or failure to notify the transaction. The PCA may also impose a fine of up to 50 times the average wage in Poland on individuals from the management who have failed to give notification of an intended concentration.

Like EU competition law, the Polish Act on Competition and Consumer Protection prohibits agreements/concerted practices between undertakings (or associations of undertakings) that have as their object or effect the elimination, restriction or other infringement of competition (Article 6). The non-exhaustive statutory list of infringements includes the following in particular:

• price fixing;
• limiting or controlling production/sales/investments;
• market sharing;
• imposing onerous/discriminatory contract terms;
• restricting access to the market; and
• collusive tendering (between tender participants or with the awarding entity).

The PCA also has the right to apply EU competition law directly (Article 101 of the TFEU) if the infringement affects trade between EU member states.

The PCA may impose a fine on undertakings and individuals for involvement in anti-competitive agreements. An undertaking may be fined up to 10% of the turnover of the entire capital group generated in the year preceding the year the fine is imposed. The PCA may also impose a fine of up to PLN2 million on management who allow the undertaking to conclude a prohibited anti-competitive agreement through their deliberate actions or omissions (except in the case of bid-rigging).

Under Polish law, leniency (immunity or reduction of a fine) is available for both horizontal and vertical agreements.

An agreement that violates competition law is invalid in its entirety or in the anti-competitive part. The PCA may also enforce abandonment of the practice, or order the offending undertaking to remedy its effects.

Like EU competition law, the Polish Act on Competition and Consumer Protection prohibits abuse of a dominant position within a relevant market (Article 9). The abuse may consist of the following in particular:

• imposing unfair prices or trading conditions;
• limiting production, market sale or technical development;
• applying onerous/discriminatory contract terms to third parties;
• preventing the development of competition; and
• market sharing.

A dominant position is held by an undertaking if it is able to prevent effective competition in the relevant market and to act independently of competitors, contracting parties and consumers to a significant degree. In Poland, there is a presumption of a dominant position if an undertaking has a market share exceeding 40%. However, this presumption may be challenged by the undertaking involved.

The PCA may impose a fine for abuse of a dominant position only on undertakings (not individuals), which are liable to a fine of up to 10% of the turnover of the entire capital group generated in the year preceding the year in which the fine is imposed.

Any legal transactions that constitute abuse of a dominant position are invalid in their entirety or in the relevant part. The PCA may also enforce abandonment of the practice, or order the offending undertaking to remedy its effects.

Significant amendments to the Polish competition law (implementing the ECN+ Directive) came into force on 20 May 2023, relating in particular to the leniency programme, liability for infringement (introduction of parental liability), levels and methods of the calculation of fines, the dawn raids procedure, legal professional privilege and international co-operation of the PCA with other national competition authorities.

In addition to the rights registered with the Polish Patent Office (see below and 7.2 Trade Marks and 7.3 Industrial Design), it is possible to apply for protection over inventions, trade marks and other industrial properties through international channels. For trade marks and industrial designs, it is possible to obtain protection throughout the EU with a single application.

Patents protect inventions that:

• are new;
• have an inventive step – ie, the invention is not obvious to a person skilled in the given field; and
• are capable of industrial application – ie, based on the invention, a product may be obtained or a method used in any industrial activity.

Patent protection lasts up to 20 years (subject to the payment of annual maintenance fees).

To obtain a patent, the application must be filed with the Patent Office and must contain a motion, a description of the invention, claims and an abstract of the invention. If the application is not filed by the creator, it is necessary to ensure the acquisition of the right to obtain a patent by the entity applying for patent protection (future patent holder). If statutory requirements are met, the Patent Office then issues a relevant decision, provided that the fee for the first protection term is paid. When a patent is granted, this is entered in the patent register.

Claims concerning infringement of a patent are heard before a court in civil proceedings. The patent holder may demand cessation of the infringement or the surrender of any unlawfully obtained benefits. If the infringement is culpable, the patent holder may also demand reparation of damage in accordance with general principles or by the payment of a sum of money in the amount of a licence fee or other relevant remuneration that would be due and payable to the patent holder for consenting to use of the invention. In addition, the patent holder may demand that the ruling concerning the infringement be made public.

A trade mark is any mark capable of distinguishing the products (or services) of one entity from those of another, and enables determination of the scope of protection in a clear and precise manner. A word (including a name), picture, letter, digit, colour, object (eg, the shape of a product or its packaging) or sound may constitute a trade mark.

Upon registration, trade mark protection rights last ten years and may be extended for subsequent ten-year periods, provided that the fee is paid. However, a protection right over a trade mark expires (and the trade mark is eligible for invalidation) if the registered trade mark is not in genuine use within five years of the date protection was granted.

Protection Rights

To obtain a protection right, a relevant application describing the trade mark and listing the products (or services) it covers (based on the classes of goods and services set out in the Nice Classification) must be filed with the Patent Office. The Patent Office examines the content of the application and the capability of registering the trade mark, but at this stage it will not examine any potential conflict with prior registrations or other third-party rights. If the statutory requirements are met, the Patent Office publishes notification of the application in the Patent Office Bulletin.

Third parties have three months to file an opposition to a trade mark application on the basis of their earlier trade marks or other rights. The opposition may be brought in respect of one, some or all of the classes of the Nice Classification. If successful, the Patent Office may grant protection for those classes that have not been challenged, unless the opposition has been proved to be unfounded, or refuse protection.

Claims concerning infringement of a protection right over a trade mark are heard before a court in civil proceedings. In addition to the remedies available in the case of infringement of a patent, the trade mark holder may demand that the infringing party ceases placing a mark identical or similar to the registered trade mark on packaging, labels and tags, or ceases offering, marketing, importing, exporting and storing such packaging, labels and tags.

Industrial design is a new and original appearance of a product, or part thereof, resulting from the features of the lines, contours, shape, colours, texture and/or materials of the product itself and/or its ornamentation. The right conferred by the registration of an industrial design is granted for 25 years, divided into five-year periods.

To register an industrial design, an application containing an illustration of the industrial design must be filed with the Patent Office. If the industrial design meets the statutory requirements for granting protection, the Patent Office issues a decision granting protection.

Claims concerning an infringement of a right conferred by registration of an industrial design are heard before a court in civil proceedings. The remedies are the same as in the case of an infringement of a patent.

Copyright protects any manifestation of human creative activity of an individual nature in any form, regardless of its value, purpose or manner of expression.

Copyright consists of economic rights and moral rights. Economic rights entitle the copyright holder to use and dispose of a work and receive fair and appropriate remuneration for the use of it, and these rights may be transferred or assigned. Along with the economic rights, there is also the exclusive right of the author to authorise the use of derivative rights to the original work (eg, translation).

Moral rights entitle the author to sign the work with their name, decide on its first publication and allow modification thereof. Moral rights cannot be transferred, assigned or licensed, but it is common practice to oblige the author in contracts transferring economic copyrights not to exercise the moral rights. Economic rights are generally protected until 70 years after the death of the author of the work; moral rights last indefinitely.

Economic rights may be transferred (or licensed) only within the fields of exploitation explicitly specified in an agreement. A field of exploitation means any manner of exploitation considered technically and economically independent in trading practice. Omitting a field of exploitation in the agreement deprives the acquirer (or licensee) of the rights to exploit a field not listed therein. The fields of exploitation make it possible to seek remuneration for each of them.

Copyright protection does not depend upon a registration process or satisfaction of any formal requirements. Once the work is established (even if not completed), it automatically receives protection.

In the event of an infringement of economic rights, the author may demand cessation of the infringement, remedy of the results of the infringement, damage compensation and the surrender of any unlawfully obtained benefit. The author may also request publication of an announcement in the press or payment of an appropriate sum of money to the copyright holder, determined at twice the amount of remuneration that would be required for a licence to use the work.

There is no special regime for the protection of software, which basically enjoys protection covered by copyright law with minor differences when compared to the works described in 7.4 Copyright.

Databases that are collected in a way that requires substantial investment of effort to compile, verify or present their content, in terms of quality or quantity, are protected by the Act on the Protection of Databases. Such protection does not depend on registration and lasts for 15 years. Regardless, databases may be protected by copyright if they can be considered a “work”.

Business Secrets

Business secrets are protected under the Polish Act on Combatting Unfair Competition, and may be violated if unlawfully disclosed, used or obtained. In the violation of a business secret, the entrepreneur may demand cessation of the violation, removal of the effects of the violation, a relevant statement, redress of damage, the surrender of any unlawfully obtained benefits, or the award of an appropriate sum of money for social purposes associated with supporting Polish culture or protecting the national heritage.

In addition, the entrepreneur may demand that the ruling concerning the violation of the business secret is made public.

Data protection issues are principally regulated by the EU General Data Protection Regulation (Regulation 2016/679 – the GDPR). The following local acts supplement the GDPR:

• the Personal Data Protection Act of 2018;
• the Act Amending Certain Acts in Relation to Ensuring Compliance with Regulation 2016/679;
• the Act on the Rules of Obtaining Information of a Clean Criminal Record of Persons Seeking Employment and Persons Employed in Financial Sector Entities; and
• the Labour Code (which regulates the processing of employees' data).

It is worth noting that local employment laws provide for stricter rules than those of the GDPR in regard to the scope of data and the admissibility of monitoring. In particular, background screening of employees and candidates (especially in regard to any criminal record) is substantially restricted, except in the financial sector, where a specific act applies, and for some specific positions in other sectors where, by law, the employee must have a clean criminal record.

Local law does not modify the applicability of the GDPR; the geographical scope of application stems directly from the GDPR.

The local data protection agency is the Data Protection Office (Urzędu Ochrony Danych Osobowych), whose main role is to control and monitor the processing of personal data, review complaints of data subjects, conduct inspections, issue decisions and impose fines, oversee accreditation, grant certifications and issue interpretations and guidelines.

Corporate Vehicles

Legislative work is currently underway on a draft amendment to the Commercial Companies Code but the legislative process is only at the first stage (ie, subject to public consultation and opinions), so it is uncertain whether the amendment will be enacted and, if so, to what extent and in what wording.

Employment Law

Whistle-blowing

The Act on the Protection of Whistle-blowers implementing the Directive of the European Parliament and of the Council on the protection of persons reporting infringements of Union law was adopted in Poland in June 2024, and stipulates that all businesses and government organisations employing 50 or more employees are obliged to introduce internal whistle-blowing systems and procedures.

Pay transparency

The amending Act to the Labour Code was published on 24 June 2025, introducing amendments to the regulations on pay transparency, resulting from the requirements of the Pay Transparency Directive of 10 May 2023. The provisions of the Act will enter into force six months after the date of announcement.

The Act only addresses the issue of salary transparency at the stage of recruitment, stating that information on remuneration should be provided to the candidate in advance, and that the employer will not be able to ask job candidates about the remuneration they received at their current or previous employers.

The Act does not address the main issues regulated by the Pay Transparency Directive, such as reporting on pay gaps and ensuring transparent and non-discriminatory remuneration systems. No draft legal provisions implementing these requirements in Poland have yet been published.

Intellectual Property

On 20 September 2024, an amendment to the Act on Copyright and Neighbouring Rights of 4 February 1994 came into force, introducing several changes. Authors and performers of audiovisual works and performers of musical and verbal-musical works will now receive royalties for making their works available online. Remuneration for the transfer of copyrights must be fair and appropriate to the extent of the right granted, the nature and extent of the use, and the benefits derived from the use of the work. New liability rules for online platforms have been introduced, requiring online content-sharing service providers to obtain licences from rights holders for the public sharing of works; a platform may be held liable for copyright infringement if it shares content without the necessary consent, unless it can demonstrate that it has taken appropriate measures to prevent such infringement. Finally, a new type of permitted use in the form of Text and Data Mining (TDM) has been introduced.

Tax Law

Cash-based PIT

Since January 2025, sole traders have been able to enjoy the cash-based PIT, which enables them to defer income tax payments until the receipt of payment from clients, rather than at the point of goods delivery or service provision, or by the invoice issuance date, as mandated previously.

Entrepreneurs operating as sole proprietors are eligible for the cash-based PIT method if:

• they are subject to taxation under the progressive tax scale, flat-rate tax, IP Box regulations or the lump-sum tax on recorded revenues;
• their revenues in the preceding fiscal year did not exceed PLN1 million;
• they do not maintain accounting books; and
• they submit a formal written declaration to the relevant tax office head, opting for the cash-based method.

Health contribution

The initial phase of reforms concerning the payment of health insurance contributions by entrepreneurs will be implemented in 2025, with changes including the exclusion of revenues and costs associated with the sale of fixed assets from the contribution base, and a reduction in the minimum base for calculating health insurance contributions.

Real estate tax

Significant amendments to the real estate tax regulations impacting entrepreneurs were enacted on 1 January 2025, which change certain definitions that are used to determine the applicability and rates of such tax.

JPK-CIT

From 1 January 2025, the largest corporate income taxpayers with revenues exceeding EUR50 million are required to maintain their accounting records exclusively in electronic form and submit them to the tax office without being prompted, following the end of the tax year (JPK-CIT), by the deadline for filing the CIT-8 tax return (effectively by 31 March 2026 for 2025). This obligation will extend on 1 January 2026 to other CIT payers who are required to submit JPK VAT records, and to all remaining CIT payers on 1 January 2027.

VAT exemption for small enterprises operating within the EU

As of 1 January 2025, new regulations enable small enterprises to utilise VAT exemptions across various EU member states. Enterprises domiciled in another EU member state will be eligible for a VAT exemption in Poland, while Polish enterprises conducting business in other EU member states are able to utilise exemptions under the conditions stipulated in those jurisdictions, provided that they:

• register for the exemption in the country of their domicile;
• ensure that their annual turnover across all EU member states does not exceed EUR100,000 in either the preceding or current fiscal year; and
• ensure that their sales in any given country do not surpass the domestic VAT exemption threshold applicable in that jurisdiction (in Poland, this threshold is PLN200,000).

Polish enterprises seeking to benefit from the exemption in other EU countries should submit a registration application and provide quarterly turnover reports to the relevant tax authority in Poland, for each EU member state in which they operate.

Threshold for maintaining accounting books

As of 1 January 2025, the revenue threshold beyond which entrepreneurs are required to maintain accounting books increased from EUR2 million to EUR2.5 million for individuals, partners in civil partnerships, general partnerships of individuals, and professional partnerships. The new thresholds apply to financial years commencing after 31 December 2024.

Excise duty on tobacco products

New higher rates of excise duty came into effect on 1 March 2025 for tobacco products, innovative products and liquid for electronic cigarettes.