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Business in Poland

Law, tax and banking. Chapter 6

    • 6.2.

      Legal aspects

      • 6.2.1.

        Exchange Controls

The Polish zloty (PLN) is the official currency of the Republic of Poland.

The PLN has been allowed to float and trade freely against all currencies since the abandonment of the crawling peg policy in April 2000.

Based on Foreign Exchange Law of October 5, 2002 (the FX Law), the Polish leg- islation ensures the free flow of capital, opening of accounts, investing and bor- rowing as far as EU and OECD countries are concerned.

The FX Law introduces, however, some restrictions with respect to particular types of transactions, which, in consequence, require a foreign exchange permit. The above-mentioned restrictions (including account opening, investing and bor- rowing) relate mainly to transactions of Polish residents with non-OECD-based entities or entities from countries with which Poland has not concluded an agreement on the mutual promotion and protection of investments.

The restrictions on direct investment by non-residents in real estate have been greatly liberalised since Poland s accession to the EU; however, there are still some restrictions with respect to acquisition of the second homes and acquisi- tion of the agricultural properties by non-residents. In addition, there are specific restrictions on investments in various strategic state-protected sectors.

All payments between residents and non-residents (as well as all non-residents cash transactions) are subject to a control of payment title. In case of transac- tions above the threshold of EUR 10,000, the bank must be presented with cop- ies of the source documents such as invoices or agreements (or in their ab- sence, with the written obligation made by the account holder stating that the above-mentioned documents will be delivered within three months of the trans- action date).

Additionally, banks are obliged to control whether the payments ordered in fa- vour of a non-resident that constitute the non-resident s proceeds or income were appropriately taxed prior to their transfer from the account.

6.2.2. Central Bank Reporting Requirements

The National Bank of Poland maintains statistical records of the balance of pay- ments, of indebtedness and foreign liabilities on the basis of bank and non-bank reports. To that end, payment transactions between residents and non-residents above 12,500 EUR must be reported.

The reporting is the bank s responsibility (except from some specific cases, e.g. the resident holding an account abroad or Polish company participating in the intra-group netting). The banks will normally report to the Central Bank on a monthly basis.

Danske Bank / KPMG / Mazanti-Andersen, Korsø Jensen & Partnere January 2006

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