WBJ #51-52 2012

Law in Poland

Political theater

A look back on major changes to Poland’s legal landscape in 2012 and what to expect in 2013

Former Prime Minister Józef Oleksy discusses Poland's political scene in an exclusive interview 8-9

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15-18

VOLUME 18, NUMBER 51-52 • DEC 24, 2012 – JAN 13, 2013 . z∏.12.50 (VAT 8% included) . ISSN 1233 7889 INDEX-RUCH-332-127

LOKALE IMMOBILIA

Since 1994 . Poland’s only business weekly in English

Sink or swim?

REAL ESTATE

The waves of economic crisis will rock Poland’s previously stable boat in 2013. WBJ asks the economists what’s in store

• 2013 forecast • Largest deals • New Warsaw tower

12-13

Plus • Tobacco battle • Turbulence at LOT • Winter-weather tech • Poland an apple giant • Bigger grants for investors • Good to be born in Poland?

In this issue

SHUTTERSTOCK

News . . . . . . . . . . . . . . . . . . . . . . .2-5 Business . . . . . . . . . . . . . . . . . . . .6-7 Interview . . . . . . . . . . . . . . . . . . . .8-9 Finance & Economics . . . . . . . . . .10 Year in Review . . . . . . . . . . . . . . . .12 Cover Story . . . . . . . . . . . . . . . . . .13 Opinion & Analysis . . . . . . . . . . . .14 Law in Poland . . . . . . . . . . . . .15-18 The List . . . . . . . . . . . . . . . . . . . . . .19 Lokale Immobilia . . . . . . . . . . .20-27 Markets . . . . . . . . . . . . . . . . . . . . . .28 Sports . . . . . . . . . . . . . . . . . . . . . . .29 Lifestyle . . . . . . . . . . . . . . . . . . . . .30 Last Word . . . . . . . . . . . . . . . . . . . .31

Change in the air

Year in review

Poland’s decision-makers seem to have made up their minds about the country joining the euro zone. What exactly are they saying?

4

WBJ looks at what shaped the news in Poland in 2012. The hits, the misses and the scandals.

12

NEWS

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Numbers in the News

The Great Orchestra of Christmas Charity

is by how much domestic users will see their gas bills shrink on average, starting in January.

316 is the number of workers Philips Lighting Poland is planning to lay off at its factory in Pi∏a.

12.9%

IMF to renew credit line

will be the size of a WWII museum to be constructed in Gdaƒsk, making it one of the biggest historical museums in the world.

Quote of the Week “The era of a particularly strong Germany in Europe is over.”

Finance Minister Jacek Rostowski responding to criticism leveled by opposition Law and Justice (PiS) politicians that the Polish government, by supporting the proposed fiscal compact, is helping to realize a “pax Germanica” plan for Germany to dominate Europe.

Figures in focus Who’s losing jobs?

Employment growth rate in Q3 of 2012 compared with Q2 (in %) 2.0

1.6

1.5 1.0 0.5 -2.4

-0.8

-0.6

-0.4

-0.3

0.1

0.1

0.2

0.3

0.0 -0.5 -1.0 *Lowest in the EU27 **Highest in the EU27

-1.5 -2.0

via ** Lat

dK

Au str ia ing do m

-2.5

Un ite

Owsiak, the head of the charity.

Half of the money raised in January will be spent on such equipment for geriatric wards.

The other half will be spent on equipment for children’s wards.

The 2011 edition of the event (the 20th so far) raised over z∏.48 million. It was spent on state-of-the-art life-saving equipment for premature babies and insulin pumps for pregnant women with diaJacek Ciesnowski betes.

Source: Eurostat

Company index Aberdeen Immobilien ................21 Griffin Group ..............................20 PKN Orlen ..................................28

On WBJ.pl A fracking big deal

Poland signs violence convention Poland has signed the Council of Europe’s convention which obliges governments to take measures to protect and prevent violence against women.

It grants the police the power to remove a perpetrator of domestic violence from his or her home. The state should also ensure access to adequate information, and establish easily accessible shelters for victims of rape and other types of violence. ●

lect money in the streets and numerous sponsors donate funds to the charity. WOÂP then uses the money to purchase medical equipment for hospitals in Poland.

For the first time, the 2013 event will focus not only on children in need of medical aid, but also on helping senior citizens. “There are many regions in Poland that don’t have geriatric hospital care, and even if they have it, they’re usually poorly equipped. We can change this,” said Jerzy

Hu ng ary Ne the rla nd s Ge rm an y Cz ech Re pu blic

The Great Orchestra of Christmas Charity (WOÂP), one of the largest charity drives in Poland, is scheduled to take place across the country on January 13.

The annual day-long event includes numerous concerts and rallies held across the country and abroad, as well as a nationwide auction. According to its organizers, the drive is one of the most effective operations of its kind in the world.

Every year the event sees thousands of volunteers col-

en ia

Data from the first months of the fourth quarter of 2012 suggest that the unemployment rate in Poland will reach 13% by the end of the year, according to a report on the labor market prepared by the National Bank of Poland. The data further indicate that the situation for young people is deteriorating – the unemployment rate for those under 25 years old is the highest in this age group and is growing.

23,000 sqm

Slo v

Unemployment to hit 13%

was the unemployment rate in Poland in November, according to the Central Statistical Office.

COURTESY OF WOÂP

David Lipton, deputy managing director at the IMF, announced that Poland has expressed interest in a second credit line with the IMF after the current arrangement, worth $30 billion, expires in January 2013. He added that he welcomed the country’s interest in renewing a credit line with the fund. Poland’s economy is expected to slow in 2013, while the country has “significant” external financing needs, the IMF explained in a statement.

10%

Sp ain

President Bronis∏aw Komorowski signed Croatia’s EU accession treaty, marking Poland’s official ratification of the document. If all EU members ratify the document as expected, Croatia will join the EU on July 1, 2013, becoming the bloc’s 28th member.

IN THE SPOTLIGHT

nd *

Croatia’s EU accession

DECEMBER 24, 2012 – JANUARY 13, 2013

Po la

2

Log on to WBJ.pl to read about the geopolitics of shale gas and how Poland could emerge as a major power if large reserves of the natural resource are found in the CEE’s largest country

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Colliers International ................22

SEGRO ........................................23

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4

NEWS

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DECEMBER 24, 2012 – JANUARY 13, 2013

Euro adoption

The president and prime minister seem to be readying the public for a push to join the euro zone, as Poland looks to enter the EU’s most influential “heart” Several top-ranking government officials began making public statements about the possibility of Poland joining the euro zone in mid-December, as the country maneuvers to maintain or even increase its influence in the European Union.

The remarks indicated that the government is getting ready to intensify efforts to adopt the euro, and renewed the debate over whether Poland should do so, considering the economic difficulties in which the currency bloc is currently mired.

At a mid-December EU summit, Prime Minister Donald Tusk said that a major decision stands before Poland as to whether it wants to be part of the “heart” of Europe where the common currency is the “foundation” or whether it wants to be a “peripheral country.”

“I am determined to convince all partners in Poland, that Poland is safe in the heart of Europe,” Mr Tusk said.

Finance Minister Jacek Rostowski later told media that “Poland will join the euro zone as soon as possible,” though he quickly tempered his words, adding that joining would happen “only when it will be safe and profitable for Poland.”

Roman Kuêniar, a top advisor to President Bronis∏aw Komorwoski, chimed in as well, and was more concrete in his statements. He said that Poland would be able to adopt the common European currency as early as January 2016.

However, analysts remained skeptical as to how quickly adoption could happen. Economists at bank Citi Handlowy wrote in a statement that “given the vagueness of these

comments it might be premature to assume Poland is aiming for a quick path to the euro.”

In order to adopt the euro, Poland needs to meet several macroeconomic criteria, including a low level of inflation, low long-term yields, a general government deficit below 3 percent of GDP, general government debt below 60 percent of GDP and a stable foreign-exchange rate.

“Poland doesn’t meet these criteria at the moment (except for debt criterion),” the Citi Handlowy analysts wrote, “though in our view most of them could be achieved within the next two to three years if the authorities show sufficient determination.”

‘Bizarre situation’ Nevertheless, the prime minister’s office seems to be setting the stage for an EU-wide discussion as to whether these criteria should be changed.

Jan Krzysztof Bielecki, head of the prime minister’s economic

SHUTTERSTOCK

Top Polish officials set stage for push toward common currency

Change coming? council, said that the current system for euro adoption is antiquated in light of the recent economic turmoil in the bloc.

“We are dealing with a bizarre situation,” he told radio station RMF FM. “We are entering a new political system, and the entrance to the euro zone is still governed by old criteria. New conditions should be set for entry into the euro zone.”

“For 12 years Greece has been in the euro zone, and they’ve complied with these

regulations for only two years,” he added.

Commenting on Mr Tusk’s earlier speech, Mr Bielecki said that the prime minister’s words sent “an important signal to our European partners – a signal that Poland is betting on Europe, that it wants to [help] build up Europe.”

Mr Bielecki said that Mr Kuêniar’s 2016 deadline may be slightly unrealistic, adding that if Poland remains relatively unscathed by the wider economic slowdown in Europe in 2013, then a realistic date for

Poland to meet the requirements of entering the ERM II (pre-euro zone) mechanism would be 2014.

But even if Poland manages to meet all of the criteria, joining the euro zone will entail some tricky political maneuvering. In order to adopt euro, Poland’s constitution will have to be changed. For that, a twothirds majority of votes is needed in the Sejm (the lower house of parliament), and an absolute majority in the upper house of parliament, the Senate.

RG, AK, JC

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DECEMBER 24, 2012 – JANUARY 13, 2013

BUSINESS

www.wbj.pl

5

Intellectual property

Within a week of declaring support for a unitary patent for the European Union in midDecember, the Polish government has backtracked and changed its stance.

Having a single patent – or unitary patent – for the EU

should make it easier for companies, SMEs in particular, to patent their inventions. Rather than forcing firms to go through the patent process in each country, a patent granted in one EU member state would apply in all others.

But top officials now say Poland won’t support the initiative. “There is a basic difference between what is good for a highly innovative economy and an economy such as ours,” Economy Minister Janusz Piechociƒski told the press.

“It is too early for us to

introduce a unitary patent,” Digitization Minister Micha∏ Boni added.

The official reason behind the change of heart is the government’s opposition to a proposal to form an international patent court. The court would operate under the EU’s Justice Tribunal and would have the final word on EU patent law.

But many Polish entrepreneurs have been protesting against the proposals for months, arguing that the unitary patent would cost them billions. According to a study

by Deloitte for the Polish government, implementing the unitary patent would cost Polish companies z∏.76 billion over the next 30 years, while sticking to the current rules will cost only z∏.48 billion.

The higher costs would stem from the wave of new patents that would be registered in Poland and the resulting legal costs that would follow, as companies try to make sure that they aren’t infringing on others’ intellectual property.

Jacek Ciesnowski

Living standards

The Economist ranking shows it was better to be born in Poland in the 80s than now In 1988 Poland came in 23rd. This year, it came in 33rd Poland is in 33rd place in a list of the best places in the world in which to be born in 2013, according to a ranking compiled by The Economist.

The results are surprising, when compared to some previous rankings. In 1988, while

Poland was still under communist rule, the country placed 23rd, higher than Denmark in that same year. This year, Denmark placed 4th. According to the ranking, the best places in which to be born in 2013 are Switzerland, Australia and Norway, respectively. None of these countries cracked the top 10 in 1988.

Back then, the United

States topped the ranking, followed by France and West Germany, respectively. This year, the US dropped to 16th and France to 26th. The reunited Germany is tied with the US in 16th place.

In the 2013 list, Poland ranks among the bottom half of EU countries, with countries such as Greece, Bulgaria and Lithuania behind. Among

the 80 countries surveyed, Nigeria was ranked last.

The list determines quality of life based on surveys of the population, covering 11 factors including wealth, crime, family life, trust in government and the stability of the economy. It also projects how these factors will look like in 2030, when children born in 2013 come of Jacek Ciesnowski age.

Will Poland block the EU’s single patent scheme?

Where to be born in 1988 1. United States 2. France 3. West Germany ...

7. United Kingdom ...

13. Norway 13. Switzerland ...

18. Australia ...

21. Soviet Union ...

23. Poland ...

32.China

Where to be born in 2013 1. Switzerland 2. Australia 3. Norway ...

16. United States ...

27. Britain ...

32. Slovenia 33. Poland 34. Greece ...

49. China ...

57. Lithuania ...

72. Russia

SOURCE: THE ECONOMIST INTELLIGENCE UNIT

After declaring support for the EUwide unitary patent law, the Polish government now says it would harm the country’s economy

SHUTTERSTOCK

Poland opposes single EU patent regime

6

BUSINESS

www.wbj.pl

DECEMBER 24, 2012 – JANUARY 13, 2013

Agriculture

Airlines

Poland now world’s no. 2 apple-juice producer

Turbulence at LOT continues

will be next to impossible, since China produces over 1 million tons of concentrated apple juice, remaining in second place should be easy enough. Many countries are moving away from growing apples, concentrating on citrus fruits instead, the newspaper reported.

Overall, Poland harvests around 3 million tons of apples a year. Half of them are sold as fruit, while the other half is processed into foodstuffs.

Without aid LOT would likely have to shut down

Jacek Ciesnowski

The former CEO has come out in his own defense, as the government awaits EC approval to aid the airline

SHUTTERSTOCK

In 2012, Poland surpassed the United States in apple-juice production, making it the world’s second largest producer of the beverage. While Poland has long been a leader in the production of apple juice, it had until recently remained in third place,

behind China and the United States. China still holds the number-one spot.

By the end of 2012 Poland will have produced 300,000 metric tons of concentrated apple juice, of which 250,000 tons will have been exported, bringing in around €350 million in revenue, Julian Pawlak, president of the Polish Association of Juices Producers, told daily newspaper Puls Biznesu.

Most of Poland’s apple-juice exports (some 95 percent) go to Germany.

While reaching first place

COURTESY OF WIKIMEDIA COMMONS

In 2012 Poland became the second-largest producer of concentrated apple juice in the world, surpassing the US

Polish orchards are big business

Marcin Piróg, who was dismissed as CEO of state-owned airline LOT in mid-December, has come out in his own defense in interviews with the Polish media. Despite his earlier assurances to the contrary, in December it was revealed that the company will record deep losses for 2012. According to various sources, the company’s losses will come in at some z∏.200-300

million. The state-owned carrier has requested almost z∏.1 billion in loans from the state.

The government has signaled its willingness to help, but the aid has to be approved by the European Commission.

The EC should announce its decision within the next two months.

While the airline searches for a new CEO, Mr Piróg went on the defensive. In an interview with TVN24.pl, Mr Piróg stated that he informed the Treasury Ministry of the carriers’ problems and asked for aid back in October. He also explained that he didn’t implement various restructuring

changes that could help save company because, “We didn’t have any money.”

While the loss for 2012 should amount to z∏.200-300 million, the problems with LOT are much deeper. The loss would be much higher if the company hadn’t sold some of its assets a few months ago. LOT sold its daughter company, aircraft maintenance provider AMS, and leased out its headquarters, raising around z∏.600 million in the process.

Experts predict that without the state aid, the company will most likely have to declare bankruptcy.

Jacek Ciesnowski

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A chance for easier determination of a debtor’s property On December 18, the government adopted a draft act on changes to the Act on Land and Mortgage Registers, which will now be examined by parliament. One of the proposed changes is to enable, among others, the police, tax authorities, courts or court bailiffs to search land and mortgage registers, for information such as the owner’s identity. Obviously, such a legal solution will make it easier and quicker to determine the property of a debtor and, as a result, will make enforcement proceedings more efficient and will improve an entrepreneur’s financial security.

Additionally, the new provisions provide for the possibility of submitting via the internet a motion on issuance of an electronic excerpt from a land and mortgage register.

Documents obtained in such a way can be printed out and, from the legal point of view, the print-outs will be equivalent to the documents issued by a court. At the moment, a similar legal solution is used to obtain freeof-charge electronic excerpts about companies. The new provisions are planned to be binding starting from the end of 2013.

Fewer obligations for those establishing new companies On December 18, the president signed legislation that will change Poland’s labor code.

The goal of the new law is to simplify and limit the obligations and procedures for entities starting a business. The law removes the requirement that a company inform the State Work Safety Inspectorate and the State Sanitary Inspectorate that business activity has begun, as well as inform these organs of the location of the business, the nature and scope of its activity and any changes to its activity. At the same time, the sanction for non-fulfillment of the above obligation is canceled. Moreover, the time limit for issuing a confirmation of granting a Tax Identification Number (NIP) for a company by the head of a tax office is to be shortened from the maximum of 14 days down to 3 days. The act becomes binding 14 days after its publication.

Action of a shareholder for redress On December 12 the Supreme Court decided that the deletion of a limited liability company from the National Court Register resulting in termination of its existence after the shareholder has instituted an action for redress of damage inflicted on the company on the basis of Article 295 of the Commercial Companies Code does not justify the discontinuance of the action instituted by the shareholder on the grounds of inadmissibility of passing a judgment (court ref. no. III CZP 83/12). ●

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BUSINESS

Tobacco

New EU cigarette laws could burn Polish industry Industry profits to go up in smoke?

Polish tobacco producers could be hit hard health warnings and graphic pictures of smoking-related ailments.

The current Tobacco Products Directive is over 10 years old, and the new one will bring tobacco laws up to date with current health studies, the EC

7

Philips Lighting Poland to cut over 300 jobs Philips Lighting Poland is planning to lay off 316 workers out of the 3,056 it currently employs at its factory in Pi∏a, as it reduces its production of traditional light bulbs.

The company has been operating in Pi∏a for 20 years and has invested over €450 million. However, the firm says that it has been forced to cut production due to EU regulations that encourage producers to use energy-saving and LED lighting technology.

Krzysztof Kouyoumdjian, communications manager at Philips Polska, announced in mid-December that employees,

Philips Lighting has been in Pi∏a for 20 years the workers union and workers council had been informed of the job reduction plan.

The process will start when the management and workers

union reach an agreement on the terms of contract termination, and will end in April 2013.

MM

Polish government wants to attract investors with grants

SHUTTERSTOCK

In December, the European Commission proposed that the EU ban flavored and slim cigarettes, a move which if implemented could have a major negative impact on the Polish tobacco industry and the government’s budget.

The Polish Chamber of Commerce (PIH) has warned that the directive could eliminate one-third of Poland’s tobacco market. As much as 40 percent of all menthol cigarettes in the EU are made in Poland.

The tobacco industry generates up to z∏.20 billion annually in tax revenue for the government. The PIH has appealed to Prime Minister Donald Tusk not to sign the directive.

The European Commission is proposing a ban on all flavored and menthol cigarettes. It also proposes that all cigarettes made in the EU should be 7.5 mm in diameter or larger.

The proposal would also affect packaging. Under the proposed new rules, 75 percent of a cigarette pack’s surface would have to be covered with

www.wbj.pl

COURTESY OF WIKIMEDIA COMMONS/MATTHEW BOWDEN

DECEMBER 24, 2012 – JANUARY 13, 2013

says. It would regulate new products and developments, like electronic cigarettes and online sales.

If approved, proposal is expected to be adopted in 2014, and would come into effect Marta Mardosz from 2015.

Merry Christmas There is no time more fitting to say "Thank You" and to wish you a Happy Holiday Season and a New Year of health, happiness and prosperity.

Poland’s Economy Ministry plans to introduce “strategic investments” grants with the goal of attracting foreign investors from key sectors to regions with high unemployment rates.

The Polish Information and Foreign Investment Agency (PAIiIZ) wants to give bigger investment grants to companies looking to invest in

key sectors, such as aviation and electronics, reported Puls Biznesu. These investments are usually very cost intensive, but also create many jobs.

PAIiIZ also wants to give bigger grants for strategic investments in regions with high unemployment rates.

Such investments could be sited even in areas where unemployment isn’t very high,

provided that surrounding areas have unemployment rates higher than 75 percent of the national average, according to PAIiIZ. PAIiIZ wants to raise the grant rate for investments in Eastern Poland from 8 to 20 percent. It’s still not known when and if these proposed changes will be implemented.

Jacek Ciesnowski

8

INTERVIEW

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DECEMBER 24, 2012 – JANUARY 13, 2013

Politics

Theater for the masses WBJ sat down with Józef Oleksy, former prime minister of Poland and current deputy leader of the Democratic Left Alliance (SLD), to talk about the possible creation of a new leftist political grouping, Polish foreign policy, the Smolensk plane wreckage and whether the socalled Polish civil war between Civic Platform (PO) and Law and Justice (PiS) is simply theater ment elections, which will take place in 2014. If indeed they intend to make a move, then that is when they will make it.

Why is Aleksander KwaÊniewski not favorably disposed towards SLD today, even though he helped found the party?

He is favorably disposed towards SLD because that is where his roots are. But he believes SLD has limited potential, that there is a 10 percent glass ceiling which our party cannot break through right now.

Ten percent is too little to be able to seize power from the right. You have to provide a formidable alternative.

That is the background to all this talk about a new party.

In the end it is all about want-

So maybe it would be a good idea for Poland’s various parties on the left to unite then?

One should be open to all discussions, but there is no possibility for us to unite with Palikot’s Movement organizationally. All this talk of the left uniting stems from an unfortunate statement by Mr KwaÊniewski, who on election day last year said that the left in Poland should merge under the auspices of Mr Palikot’s party.

Because Mr KwaÊniewski is fascinated with Mr Palikot he suggested that a party like SLD, which has ruled Poland twice before, should just pack up and accept the fact that it is useless. Luckily, SLD members found in themselves the will to stay independent.

What does SLD have to do to break that 10 percent glass ceiling and what will happen if it doesn’t break through it during the next parliamentary STAWINSKI / REPORTER

Remi Adekoya: Marek Siwiec, a well-known member of the European Parliament, recently left SLD and is now talking about creating a new leftist coalition with Janusz Palikot, the leader of Palikot’s Movement (RP), and former president Aleksander KwaÊniewski, who co-created SLD. Is this a realistic political project?

Józef Oleksy: Right now there is some speculation on this issue but it is bereft of any evidence in political reality. Very importantly, Mr KwaÊniewski, who is supposed to be the leader of this political initiative, has not come out publicly with any announcement.

I guess what these gentlemen are doing now is observing the opinion polls and what results from them. We need to wait till the European Parlia-

ing to win power by building a political base that can get you at least 25 percent of the vote.

That’s the support level you need to be a major player in the forming of a government.

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Mr Oleksy says SLD will become a “marginal” party if it does not get more than 10 percent support in the next election elections in 2015?

If SLD doesn’t win more than 10 percent of the vote in the next parliamentary elections, then it will be a marginal party.

The next elections will create a new political configuration and if SLD is not a big player in that configuration then it will be of no importance.

What does your party need to do to achieve that?

We have to skillfully exploit the public mood, which will grow continually worse as optimism weakens. Unemployment must be addressed as it is the biggest concern right now.

SLD formulates propositions but they are not heard in the loud war going on between PO and PiS. But we must continue addressing the matter, as this young generation will not tolerate a high level of unemployment. There is also the question of rising income inequality, which the right pretends not to see.

PiS, though a conservative party, talks about poverty a lot ...

Well, that is true. PiS has taken on significant aspects of the redistribution approach and speaks more radically about it

than SLD. We are a more responsible party that believes public finances must be in order. PiS meanwhile has no barriers in its rhetoric.

What makes SLD different from other parties?

We will continue our proEurope approach. We support further integration. Others are either silent on this matter or they exploit fears of us losing our sovereignty and identity.

But we should be pushing liberal social issues more. Right now Mr Palikot is doing that more radically than we are.

So you want to be even more radical?

No, we shouldn’t be more radical. We should be decided and distinct. There is no sense in starting a war with the church.

What for? We just support the separation of church and state.

We are neutral.

But for a leftist party, SLD has precious few symbols of progressive politics. Mr Palikot’s party has Poland’s first openly gay MP as well as the first transsexual MP in Europe. How do you convince voters that SLD is a modern leftist party when you don’t

have such faces?

The Mayor of Cz´stochowa [Krzysztof Matyjaszczyk] is a good example of a true leftist politician. He is running one of the most conservative and religious cities in Poland and

“Politics is a game which offers drama to the masses” he was the first mayor in the country to introduce state support for the in vitro procedure where the city would bear part of the cost. Nobody else did that before. There must be more such examples. Being leftist must mean something.

So on your right flank you have PiS, which has appropriated your redistribution rhetoric, while on the left flank you have PO, which has appropriated your pro-Europe rhetoric. After all, Foreign Minister Rados∏aw Sikorski has gone further than SLD by calling for a federal Europe ...

INTERVIEW

DECEMBER 24, 2012 – JANUARY 13, 2013

Mr Sikorski’s remarks on federalism have been largely propaganda stunts. But the government is doing some good things in its foreign policy towards Europe. I grant that. We agree with their stance on the budget discussions. And it is true that they also are taking that proEurope profile away from us.

You strongly criticized Mr Sikorski’s request to EU diplomats for help in securing the return of the wreckage of the plane which crashed in Russia in 2010 killing President Lech Kaczyƒski and 95 others. Why? We need a reset in PolishRussian relations and Mr Sikorski’s comments about the wreckage are typical of an ancient Polish attitude full of bitterness towards Russia.

That is a bad way to build relations. Also, requesting help from EU diplomats is a sign of helplessness.

It is possible that the Russians are purposely withholding the wreckage in order to cause conflict here in Poland. I know Russians, they can be very mean, but what are we going to do, go to war with them? Reporting to a higher authority works in high school but not in diplomacy. By the way, what do we need that wreckage for anyway? We don’t need it for anything.

It’s symbolically important, isn’t it? The wreckage of the plane in which the president of Poland and many other politicians died is still in Russia two years after the crash ...

OK, but that is not the same thing as if the Russians were occupying a piece of Polish territory, is it? And some are acting as if that were the case.

When it comes to Poland in the EU, do you think the government is boxing above Poland’s weight, below its weight, or in the appropriate category?

I don’t know about all the details of the government’s EU policy, so it is a bit difficult to say. But from what I see, the government is doing quite well in the budget negotiations. But they are not doing enough in

the area of offering suggestions for future EU strategy, they are weak on that front.

We need federalism in Europe. I wouldn’t go as far as SLD leader Leszek Miller, who talked of a United States of Europe. That is too much of a simplification. You cannot compare Europe and the US. The US is a country of immigrants, while Europe has strong nation states with

Unfortunately, foreign capital did not bring to Poland state-of-the-art technology as we had expected. Rather it brought car assembly plants and the like. And now there is no strategy for future growth.

We need an agreement between political parties that will say “OK, these are the five key points in our country’s strategy, we can fight each other and try to tear power out

“What do we need the wreckage of [the presidential] plane for anyway?” strong national identities. But we do need to go in the direction of federalism.

Many on the right believe that problems facing Poland today, such as corruption, stem from the fact that influential former communists were not purged from the new system but remained in positions of power and continued to shape Poland’s future. As a former communist party member yourself, what do you say to that?

That kind of hysterical and hate-filled tone is one that unfortunately occurs often in Poland. Every historical period has its own logic and systems are often defiled. Socialism was defiled, that’s for sure.

But the lack of perspective causes obsessive behavior in Poland’s public life.

There is a big tendency to divide people in Poland, people dig into their positions and try to prove that only they are right. Compromise is difficult in Poland. Nobody is talking about what will be the foundation for our country’s economic growth in the future.

There is much talk of innovation ...

It takes at least a decade to create an innovative society.

Those who think that the state spending a few hundred million euros more on R&D than it does today will magically create an innovative society are exhibiting the height of incompetence.

of each other’s hands, but we will all keep to these five points no matter which of us rules.”

But there is no compromise of that sort in Poland. Instead politicians like PiS leader Jaros∏aw Kaczyƒski live in a world they have imagined and focus on creating negative emotions in Poles.

Speaking of political conflicts in Poland like the so-called “civil war” between PO and PiS – are they for real or are they just theater for the masses? Do politicians who act like mortal enemies on camera actually go for lunch together when the cameras stop rolling?

Politics is always theater.

Sometimes it is good theater, sometimes it’s bad. I remember in the first semi-democratic parliament in Poland, we in the communist party would have heated arguments in parliament with the democratic opposition politicians, we pulled no punches. But after that we would go out and drink vodka with those of them who knew how to drink [laughs].

That is natural, politics has always been a game that offers drama to the masses.

However, I have to say there is real animosity between PO and PiS politicians today. On an individual level some of them do fraternize of course, but in the case of their parties as a whole, the hatred is for real. ●

Józef Oleksy Józef Oleksy was born in 1946 in Nowy Sàcz.

From 1964 to 1990 he was a member of the communist party, eventually rising to the post of first secretary. In the 1990s, he cofounded the Democratic Left Alliance (SLD), an offshoot of the defunct communist party. He was leader of SLD from 2004 to 2005.

He served as prime minister of Poland from 1995 to 1996 but was forced to resign following accusations that he had been a Russian spy. In a long political career, he has also held the post of deputy prime minister, internal affairs minister and Speaker of the Sejm. He is currently deputy leader of SLD. ●

www.wbj.pl

9

FINANCE & ECONOMICS

www.wbj.pl

Domestic retail users will see their gas bills shrink by 10% on average in January, and commercial users by 2-4%, according to the Energy Regulatory Office. Prices will fall because PGNiG reached an agreement with Gazprom at the beginning of November to lower gas prices imported from Russia. In spring of this year, however, PGNiG increased gas prices for commercial users by more than 15%.

Poles see grim future More and more Poles feel that Poland’s economic situation is getting worse.

Currently, 67% believe that the economic situation is going downhill (compared to 57% in November), only 24% are optimistic (compared to 26% a month earlier), a recent CBOS poll shows.

Over half (52%) of those polled don’t believe that next year will bring any change for the better and 26% think that next 12 months will be even worse. ●

The unemployment rate in November rose to 12.9 percent from 12.5 percent in October, the Central Statistical Office (GUS) reported in late December. There were also fewer vacancies available in labor offices than in the previous month.

The data was worse than the market had expected, with economists predicting unemployment would come in at 12.8 percent. The rise was mostly due to seasonal changes, as construction firms wind down their activity in the winter. Nevertheless, to put the figure in perspective, in November 2011 Poland’s unemployment rate reached just 12.1 percent, while two years ago it was at 11.7 percent.

Economists at BZ WBK said the data showed that the “negative tendencies on the Polish labor market are intensified” and that “the bottom of economic cycle is still ahead.”

“It is worth emphasizing that this strong increase in unemployment took place despite intervention by the Labor Ministry, which used additional resources from the labor fund in the September-November period,” they added. “In our opinion without this intervention the registered unemployment rate would have increased towards 13.5 percent.”

GUS announced that labor offices had recorded 2,058,100 registered unemployed by the end of November. The voivodships that saw the most significant increase in unemployed registrations were Lubuskie, Wielkopolskie, Lower Silesia, Ma∏opolskie, and Warmiƒsko-

Still edging upward Poland's unemployment rate (%), November 2010-November 2012 15.0

13.5

12.0

Source: Central Statistical Office

The number of unemployed Poles continues to rise

10.5

9.0

Mazurskie.

The highest unemployment rates were recorded in the northwestern voivodships of Warmiƒsko-Mazurskie (20.4 percent) and Zachodniopomorskie (17.4 percent). The

voivodships that recorded the lowest unemployment rate were Wielkopolskie (9.5 percent) and Mazowieckie (10.5 percent).

GUS also announced that a total of over 49,000 new workplaces were created last

month, 18,400 fewer than in October. According to the monthly report, 553 Polish employers announced employment reduction plans, expected to impact 38,600 people.

Marta Mardosz

Poles’ real wages fall, Shrinking industrial output paves way for monetary easing further interest rate Industrial output shrank by 0.8 percent year-on-year in November, significantly down from October, when output grew by 4.6 percent y/y, Poland’s Central Statistical Office said on Wednesday.

The slowdown proves that the rebound in output growth in October was a one-off event due to a positive working-day effect (2 days more

than a year earlier), Nordea Bank analysts wrote in a statement. In November, the positive effect was weaker (1 day more on the year), driving output growth lower, the bank added.

“We think that the recent … data (lower than expected [consumer price] inflation, wages, employment and industrial output) will pro-

vide an incentive for central bankers to continue monetary easing. Thus, we believe that moderate hawks will support not only the next rate cut by 25 basis points in January … but they will also vote for [another] two cuts in Q1 2013, bringing the key policy rate down to 3.5 percent,” the Nordea analysts wrote.

RG

November PPI lower than expected Despite market expectations for it to remain unchanged, Poland’s Producer Price Index fell to -0.1 percent in November from 1.0 percent in October. The reading is the index’s lowest since April 2010.

According to Bank Millennium, the decline in producer

prices was likely influenced by falling prices of industrial raw materials (such as coal, petroleum and metals) and the strengthening of the z∏oty, driving exports and imports prices down.

The decline in PPI may also be traced back to a high

statistical base effect last year, when the depreciation of the z∏oty resulted in a steep price hike in the manufacturing sector, the bank analysts wrote, adding that they expected PPI to decline further by 25 basis points in December.

RG, BS

cuts on the cards The average gross salary in Poland was z∏.3,781 in November, a rise of 2.7 percent y/y, according to data from the Central Statistical Office. Inflation in November was 2.8 percent y/y, meaning that real income dropped over the same period. Prices have been growing at a faster pace than wages for several months now.

Average employment drop-

ped by 0.3 percent y/y in November. “The data confirmed that the situation in the labor market is deteriorating,” BZ WBK analysts said in a statement, “which means there is no threat of strengthening wage pressure or second round effects. More interest rate cuts are needed and justified, with the next one most likely already in January.”

RG

Wages in Poland’s corporate sector, August-November 2012 (in z∏.)

4,000 Source: Central Statistical Office

Natural gas prices to fall 10%

Unemployment hits 12.9 percent

v. ' 10 c.

'10 Jan . '1 1 Feb . '1 1 Ma r. ' 11 Ap r. ' 11 Ma y '1 1 Jun . '1 1 Jul . '1 1 Au g.

'11 Se p.

'11 Oc t. ' 11 No v. ' 11 De c.

'11 Jan . '1 2 Feb . '1 2 Ma r. ' 12 Ap r. ' 12 Ma y '1 2 Jun . '1 2 Jul . '1 2 Au g.

'12 Se p.

'12 Oc t. ' 12 No v. ' 12

Poland’s deficit at the end of this year should be lower than the z∏.35 billion budgeted, according to Deputy Finance Minister Wojciech Kowalczyk.

Calculated according to the EU’s methodology, the country’s deficit will be just below 3.5% of GDP, while public debt will come in at 56% of GDP. Polish methods of calculating the debt-toGDP ratio put it at 53%.

Joblessness

No

Poland’s deficit lower than expected

DECEMBER 24, 2012 – JANUARY 13, 2013

De

10

3,900 3,800 3,700 3,600 3,500 Aug. '12

Sep. '12

Oct. '12

Nov. '12

12

YEAR IN REVIEW

www.wbj.pl

DECEMBER 24, 2012 – JANUARY 13, 2013

A look back at 2012

2012 brings highs and lows for Poland

The year began with whines and moans, as well as a bang.

First, changes to prescription-drug laws led to protests among doctors.

New regulations introduced at the start of 2012 required doctors to verify and then note on any prescription they issue the precise level of reimbursement to which a particular patient is entitled, as well as to verify that the patient is indeed insured. In protest, thousands of doctors across the country declined to fill out prescriptions according to the new regulations. Thus began what the media dubbed “the stamp protests.”

Also making headlines was the attempted suicide of Military Prosecutor Colonel Miko∏aj Przyby∏. The incident rocked Poland’s legal establishment, and highlighted a conflict of interest between Military and Civil Prosecutors. Colonel Przyby∏ had staunchly defended the actions of the Military Prosecutor’s Office in Poznaƒ during an investigation into information leaks concerning the 2010 Smolensk disaster.

Poland suffered its deadliest rail disaster in over 20 years on March 3rd after two trains collided head-on near the town of Szczekociny, in the south of Poland, as they were traveling on the Kraków-Warsaw line. A two-day period of national mourning was observed after 16 people were killed, and an additional 56 injured. The cause of the crash was human error.

In political news, Prime Minister Donald Tusk signed the European fiscal pact, joining 24 other heads of state. All EU countries except the UK and the Czech Republic signed the treaty, which aimed at increasing budget discipline in the euro zone.

On the other end, Poland singlehandedly blocked the EU climate plan after it vetoed the EU’s “Energy Road Map 2050” at a meeting of environment ministers in Brussels.

April

SHUTTERSTOCK

February

Dominating headlines in February was unquestionably the signing, and then rejection, of the Anti-Counterfeiting Trade Agreement (ACTA) by the Polish government. In early February, despite a huge public outcry, the Polish government signed the international copyright treaty. In less than a month, after seeing a steep drop in public support for his party, Civic Platform (PO), Prime Minister Donald Tusk admitted he was wrong in supporting the treaty.

The news of poet Wis∏awa Szymborska’s death made worldwide headlines. The winner of the Nobel Prize for Literature passed away at the age of 88.

April saw the second anniversary of the Smolensk tragedy pass, revealing deep divisions in Poland. A tragedy that once united Poles turned into what could be a long-lasting wedge in Polish society. The division was clearly showed in an April poll by Gazeta Wyborcza which indicated that 18 percent of Poles believe Lech Kaczyƒski was assassinated and 32 percent think that both the Polish and Russian governments are hiding the truth about the Smolensk catastrophe.

In other news, Chinese Premier Wen Jiabao visited Poland for the first time, revealing Poland’s growing importance on the world stage. The Premier’s visit – during which he was accompanied by 300 Chinese businesspeople – marked China’s highest-level visit to Poland since 1987.

May In May, amidst protests from labor unions, Poland’s parliament passed controversial pension reform legislation, raising the retirement age to 67 for both men and women. Prior to the reform, Polish men could retire at 65 and women at 60.

In other domestic news, on the back of what was predicted to be a lackluster economic start for 2012, the Polish banking sector impressed investors with strong Q1 results. A number of

An erroneous report in one of Poland’s leading daily newspapers caused a political firestorm. Rzeczpospolita reported that Polish investigators had found traces of explosive materials, including TNT and nitroglycerin, on the wreckage of the plane that crashed in Smolensk, Russia in 2010, killing President Lech Kaczyƒski and 95 others.

Similarly to 2011, violent scenes marred Poland’s Independence Day on November 11. Several police officers were hospitalized and 176 rioters were arrested. Riot police confronted right-wing nationalists in central Warsaw during the biggest of four Independence Day marches in the city.

Lastly, a slew of companies released Q3 earnings in November, with particularly strong results coming in from energy firms Tauron and PGE, as well as miner Bogdanka.

PGNiG also received good news after Russia’s Gazprom agreed to lower the price of natural gas it delivers to the Polish gas monopolist.

September Continuing to make headlines was the Amber Gold scandal. Under pressure, Prime Minister Donald Tusk was forced to address parliament, placing much of the blame on prosecutors for failing to act after being warned as early as 2009 of Amber Gold’s actions.

Poland’s view on international affairs had its day in the spotlight during the United Nations General Assembly in New York in late September. President Bronis∏aw Komorowski, who addressed the assembly, said NATO’s operation in Afghanistan, in which Poland plays a major role, has shown that a “military-first approach is not the best way to resolve difficult internal conflicts.”

The year’s biggest soccer event consumed headlines in June, as Poland co-hosted the 2012 European Championships with Ukraine. Games were played in Warsaw, Gdaƒsk, Poznaƒ, and Wroc∏aw. The tournament was regarded as a huge organizational success. To the dismay of Polish fans, however, their national team was unable to pass through the group stage. Spain won the tournament, beating Italy in the final 4-0.

In business, PBG, Poland’s thirdlargest construction company, responsible for the construction of three of the four stadiums in Poland that had been built for the tournament, filed for bankruptcy.

July The biggest news story was the resignation of Agriculture Minister Marek Sawicki, after alleged corruption within his ministry.

Polish low-cost carrier OLT Express canceled its chartered connections on July 31 and filed for bankruptcy. The event consumed headlines as the airline’s owner – Amber Gold – slowly took center stage as more and more information pointed to the company operating as a pyramid scheme.

August The then-owner of bankrupt OLT Express – Amber Gold – was thrown into the spotlight in August. Clients were unable to withdraw their deposits from the Gdaƒsk-based lender. Despite all the negative press, Amber Gold’s president, Marcin P., accused the Internal Security Agency (ABW) of mounting a campaign against him and his company. Mr P.’s last name cannot be published, in line with Polish privacy laws, as he has been arrested.

August also saw many Polish blue chips release Q2 earnings. Once again, the banking sector proved

October

COURTESY OF KPRM

March

June

COURTESY OF UEFA

January

November

resilient as Millennium Bank and BZ WBK revealed high net profits. The good news, though, did not extend to the oil and mining sector, as Orlen posted a net loss in Q2. A one-month maintenance shutdown at the firm’s Lithuanian unit and lower fuel consumption hit the giant’s profits.

Europe’s second largest copper miner, KGHM, also revealed worsethan-expected Q2 results. KGHM put much of the blame on a new mining tax, as well as a fall in metals prices.

Polish banks posted year-on-year net profit increases, mainly due to improved margins.

Prime Minister Tusk won a vote of confidence in October after polls suggested the ruling Civic Platform was falling behind opposition Law and Justice (PiS). PM Donald Tusk announced a z∏.200 billion investment program, as well as policies for combating Poland’s demographic problems. Also in an attempt to stir up confidence, the prime minister announced that his government would hold tenders valued at over z∏.73 billion during the years 20132015 in order to continue recent investments in highways and to modernize the country’s antiquated railway system.

December COURTESY OF KPRM/MACIEJ ÂMIAROWSKI

From the protest of thousands of doctors and pharmacists across the country, to the Amber Gold scandal, to Poland’s successful hosting of the Euro 2012 tournament, there was no shortage of headline news in 2012. WBJ reviews the year’s biggest stories

In early December, Poland’s government approved changes to the law that will allow it to use the average annual exchange rate to calculate public debt denominated in foreign currencies, thus limiting the impact of exchange-rate fluctuations on the size of the debt. Up until then, the z∏oty rate from the last day of December was used to value Poland’s foreign debt. This change will ease pressure on Poland’s thorny debt ceiling.

Janusz Piechociƒski of the Polish People’s Party (PSL) took on the deputy PM role in early December.

The number-two in government said Poland needs “more creative politics” and stressed his dedication to protecting jobs.

Also making news was the announcement by the Polish Financial Supervision Authority approving the merger between BZ WBK and Kredyt Bank. The decision paved the way for the creation of the thirdlargest bank in Poland.

Andrew Nawrocki

COVER STORY

DECEMBER 24, 2012 – JANUARY 13, 2013

www.wbj.pl

13

The year in review

Will the Polish economy falter in 2013? gesting that Poland’s western neighbor might not be forced to drastically cut down on imports.

SHUTTERSTOCK

Ready to enter a trouble zone?

Growth will sink in 2013, but Poland won’t go under

Poland has been the European Union’s growth star in recent years, but its previously resilient economy is now showing visible signs of strain One thing just about everyone agrees on is that 2013 will be a tough year for the Polish economy. In recent months, economists, financial institutions and the government have all lowered their expectations for GDP growth next year as recent macroeconomic indicators give little cause for optimism.

The economy grew at just 1.4 percent in Q3, the slowest pace since the second quarter of 2009.

The IMF, the European Commission and the OECD now all predict Poland’s GDP will expand by less than 2 percent in 2013. The Polish government remains slightly more optimistic, recently passing a 2013 budget that assumes 2.2 percent growth for the year, significantly less than its previous assumption of 2.9 percent.

When he presented the

budget in December, Finance Minister Jacek Rostowski said the “global, European and Polish economic situation [at the end of 2012] is similar to the situation at the end of 2008, although we should point out that the situation is less dangerous now than it was then.”

“Today, we have a mild crisis in Western Europe, back then we had a gigantic breakdown,” he added.

Q1 the worst So what do Polish economists think?

“Next year we will have an economic slowdown, a drop in investment and weak consumption,” said Grzegorz Maliszewski, chief economist at Bank Millennium.

Jaros∏aw Janecki, his counterpart at Société Générale, predicts growth of 1.7-1.9 per-

2013 GDP forecasts for Poland Finance Ministry European Commission IMF OECD HSBC Morgan Stanley

2.2% 1.8% 1.75% 1.6% 1.6% 1.5%

cent next year while Przemys∏aw Kwiecieƒ, chief economist at X-Trade Brokers, puts the figure at 1.5 percent.

Mr Kwiecieƒ said the “worst period” in 2013 will be the first quarter. “Firms will be careful about organic investments and that will affect growth. But then things will improve a bit as the year goes on,” he added.

All of the economists interviewed by WBJ for this story pointed to the unresolved euro zone crisis as the major headache for Poland’s economy.

“The euro zone crisis will have a negative effect on Polish exports next year,” said Mr Maliszewski. However he added that he believes the z∏oty will not appreciate too sharply, helping keep Polish products competitive.

But Mr Kwiecieƒ was decidedly bearish on the chances of the economy during a euro zone slowdown.

“Until the situation improves in Europe, we cannot expect improvement in Poland,” he said.

A quarter of Poland’s exports go to Germany, and so the condition of that country is key for its economy. Mr Janecki sees cause for optimism on this front. “Plans for looser fiscal policy and tax cuts in Germany will lead to salary increases there,” he said, sug-

In December, Prime Minister Donald Tusk announced that his government’s final decision on whether to take Poland into the euro zone will be made in the “nearest months.”

The prime minister also said Poland has to decide whether to be part of the “heart of Europe,” or a “peripheral country with its own currency,” tacitly indicating his view on the matter. President Bronis∏aw Komorowski also recently voiced support for joining the currency union.

But if the government does decide to take the plunge, it will not have an easy sell. A November poll showed 58 percent of Poles think adopting the euro would be bad for Poland.

And while Mr Maliszewski thinks the government announcing a concrete date for Poland to join the euro zone would have a “positive effect on the economy,” Mr Janecki said it would have “no effect.”

Mr Kwiecieƒ said he does

Economists weigh in Here are some of the other important issues that the economists we interviewed mentioned.

Przemys∏aw Kwiecieƒ chief economist at X-Trade Brokers “Many bad-case scenarios have already materialized – there is less demand for exports and a careful approach to organic investment by international corporations.”

Jaros∏aw Janecki chief economist at Société Générale “If the government announces that we are joining the euro zone, then the most important thing will be how Polish fiscal policy shapes up in the following months. It would have to be restrictive. Monetary policy would also have to be more restrictive.”

Grzegorz Maliszewski chief economist at Bank Millennium “The economic situation in the EU and the slowing economy in Poland will mean that the government will aim to keep the Polish currency because it improves the competitiveness of our firms.” not expect Poland to join the euro zone anytime soon, and called Mr Tusk’s statements a “publicity stunt.”

“The euro zone is not ready for such a big economy as Poland right now. [The euro zone] first has to improve its situation before we can talk about [Poland] joining,” he concluded.

And so even though Poland’s economic fundamentals are in order and its financial system healthy, the situation in the euro zone will be crucial in determining whether 2013 will go down in history as a good year for the CEE’s largest economy.

Remi Adekoya, Marta Mardosz

14

OPINION & ANALYSIS

www.wbj.pl

DECEMBER 24, 2012 – JANUARY 13, 2013

Europe’s two-speed future Jean-Claude Piris

F

or three years, the euro crisis has threatened not only to unravel the euro zone, but to bring down the entire European Union with it.

Although the pressure from financial markets has moderated, for now, a long-term resolution to the crisis remains an existential priority for the EU. In today’s highly competitive global economy, European countries’ relatively small size, aging populations, and excessive indebtedness, combined

States,” and that “only [euro] Member States … shall take part in the vote” – is wide. In addition, Article 138 would allow unified representation of the euro zone in the International Monetary Fund and the World Bank.

The group could then extend cooperation to three other policy areas:

Europe” – in which a core group of countries pursues deeper integration more quickly than the rest – is the EU’s best option for reaching the level of cooperation needed to escape the crisis intact. This can be accomplished in two ways.

The first option would be to progress de facto towards a two-speed EU without establishing further legal commitments. Euro zone countries, together with others willing to join the euro in the future (the “euro zone

• Minimal harmonization of tax laws (such as a common basis for assessing corporate taxation) and social policy (such as further liberalization of national labor markets to encourage labor mobility); • Common policy measures on immigration, linked to labor-market needs; • Closer judicial cooperation – again aimed at encouraging mobility – in civil matters with cross-border implications, specifically concerning contracts and family law.

“Individually, [EU members] cannot compete with emerging markets; they need a strong EU to face the challenges posed by globalization” with a lack of energy resources and insufficient investment in research and development, mean that their high living standards and generous social-welfare states are in jeopardy. Individually, they cannot compete with emerging markets; they need a strong EU to face the challenges posed by globalization.

Tough changes ahead Given that treaty change is politically unfeasible, establishing a “two-speed

plus”), could simply decide to use the legal means already available to increase cooperation.

Ideally, this cooperation would take place within the EU’s institutional framework. If all euro zone members participated, Article 136 of the Treaty on the Functioning of the EU could be used to support their action. The scope of this provision – which says that, “the [European] Council shall … adopt measures specific to [euro] Member

The group could also take some measures outside the EU framework.

Indeed, if all euro zone countries did not participate, such outside cooperation would be crucial, given that Articles 136 and 138 would no longer apply. This could include measures to strengthen the European Stability Mechanism and the Euro Plus Pact

(designed to enhance economic policy coordination among member states), de facto cooperation within the Bretton Woods institutions, and voluntary approximation of national laws in certain areas.

Participating countries would have to decide whether to commit to a common set of policies, or to reserve the right to opt in on a case-by-case basis.

Cooperation on matters related to the EU’s Economic and Monetary Union (discipline and solidarity) should be obligatory. The involvement of most, or all, current and future euro zone countries would enhance the group’s coherence, making it easier to win public support for cooperation in other areas.

Enhanced cooperation Pursuing this option would require that the decision-making process be legitimate. In the Council, as in all cases of “enhanced cooperation,” only participating members have the right to vote. In the European Parliament, by contrast, all 27 EU members participate in the decision-making process, even concerning measures that will affect only the 23 “euro zone plus” countries (the seventeen euro zone members and the six that have

agreed to the Euro Plus Pact) – a method that could pose a political problem. In any case, national parliaments should become involved in order to enhance the legitimacy of decisions.

The second option would imply an international agreement, in addition to the EU treaties, which would legally bind participating countries, enabling them to commit to establishing a genuine economic union, and to define the organs and rules that will govern their cooperation.

Such a treaty would take time to be negotiated, ratified, and implemented. But a clear, precise announcement of the decision to pursue it, together with a bold European Central Bank policy in line with its recently announced bond-purchasing program, might be enough to convince both financial markets and EU citizens that a lasting solution is within sight. ● Jean-Claude Piris, former Director General of the Legal Service of the Council of the European Union, is the author of “The Future of Europe: Towards a Two Speed EU?” Copyright: Project Syndicate, 2012. project-syndicate.org

Emerging Europe’s deleveraging dilemma Erik Berglof & Bozidar Deliç

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erbia’s Tigar Corporation, a privatized automobile tire and tube maker, was a poster child for corporate makeovers in transition economies. Then euro zone deleveraging kicked in, and now the child in the poster is in serious trouble.

When Tigar sold its tire division to France’s Michelin, it invested the entire proceeds in new businesses. Perhaps capital expenditures were overly ambitious, but they triggered rapid export growth, and more than 2,000 jobs were created in the small town of Pirot.

Many banks in Serbia and other transition countries in Europe rely heavily on funding from their euro zone parent institutions. But, since the onset of the global financial crisis, euro zone-based banks’ subsidiaries in emerging Europe have been reducing their exposure to the region. In 20092010, the European Bank Coordination Initiative – known informally as the “Vienna Initiative” – helped to avert a systemic crisis in developing Europe by stopping foreign-owned parent banks from staging a cata-

strophic stampede to the exits.

But, in the second half of 2011, the euro zone-based parent banks that dominate emerging Europe’s banking sector came under renewed pressure to deleverage. Many are now radically changing their business models to reduce risk.

Stopping the cash-flow Over the last year, funding corresponding to 4 percent of the region’s GDP – and, in some countries, as much as 15 percent of GDP – has been withdrawn.

Bank subsidiaries will increasingly have to finance local lending with local deposits and other local funding.

Without disputing the need for some deleveraging, a new incarnation of the Vienna Initiative – Vienna 2.0 – seeks to make the process orderly. Of course, after several years of unfettered credit expansion, some retrenchment was necessary and desirable, and Tigar probably overextended itself.

But several factors – most of them unrelated to the region – are pressuring banks to pursue faster-than-optimal deleveraging.

For starters, the Basel III package of global banking reforms and the European Union’s corresponding Capital Requirements Directive IV rule create disincentives for cross-border financing. To be sure, they will help to prevent banks from using instruments resembling collateralized debt obligations (which banks use to repackage individual loans for placement on secondary markets) to reduce their exposure. But the new regulation also seriously penalizes subsidiary financing in new EU member and accession countries. Indeed, in many countries, bank guarantees can be issued only on the basis of local subsidiary equity, without support from the parent’s balance sheet.

The domino effect Furthermore, collateral – especially real-estate assets – will continue to be downgraded. Poor 2012 corporate financial results will further undermine credit ratings. Fewer and fewer companies will meet basic risk criteria. While governments might offer attractive liquidity facilities, banks will be unable to

on-lend the funds. And spillover effects from Greece will continue to affect Balkan and other emerging European banking markets.

That is why the Vienna Initiative must become an effective “voice” for the host countries in the Europe-wide debate on debt resolution and banking union. Every effort must be made to

deliver.

The European Commission and multilateral lenders should help to facilitate ongoing structural change in the banking sector, including bank acquisitions and balance-sheet restructuring for viable export-driven companies. In exchange, private banks must live up to their collective responsibility

“Private banks must live up to their collective responsibility to smooth the deleveraging process” prevent the creation of new barriers within Europe’s financial system.

Some progress has been made toward safeguarding emerging Europe’s banking system. The European Investment Bank, the World Bank, and the European Bank for Reconstruction and Development have agreed on a new Joint Action Plan, including investment totaling €30 billion ($39 billion) over the next two years, as well as policy advice, to support economic recovery and sustained growth in the region. They must now

to smooth the deleveraging process and limit the systemic impact of their actions. Under these conditions, deleveraging could put emerging Europe on a more sustainable growth path. ● Erik Berglof is chief economist of the European Bank for Reconstruction and Development. Bozidar Deliç was Deputy Prime Minister of Serbia.

Copyright: Project Syndicate, 2012. project-syndicate.org

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DECEMBER 24, 2012 – JANUARY 13, 2013

Upcoming changes to Polish law

Bartosz D´bski Partner, Magnusson

Poland from most Western European countries in areas such as development of infrastructure, environmental protection, zoning and efficient administration is still huge. These issues must be tackled in the coming years if Poland is to create a solid foundation for further sustainable development and offer its citizens the same quality of life as is offered by Western European countries. Otherwise, Poland will lose its chance to catch up quickly with its neighbors to the west.

So what is the Polish government going to do to address these key issues in 2013? And will it be enough?

built. Thanks to the completion of the A2 motorway, you need just over an hour to get from Warsaw to ¸ódê, three hours to get to Poznaƒ and five hours to Berlin. That is almost two times shorter than just five years ago.

The modernization of road infrastructure will continue in 2013, with the opening of new sections of the A1

Infrastructure and environmental protection

between Gdaƒsk and the border with the Czech Republic, new sections of the A4 between Kraków and the border with Ukraine, and many sections of express roads. The construction of hundreds of kilometers of other main roads will start in 2013. On the other hand, the government promises that it will also give more priority to the development of rail transport which has been lagging behind in recent years.

bartosz.debski@magnussonlaw.com

T

he Polish economy is doing pretty well compared to the rest of Europe. The country is also enjoying much faster GDP growth than many of its post-communist neighbors. This Polish government might cite this as proof that it is doing a good job at fostering business activity in these difficult times.

However, the distance separating

The government has put a lot of effort into improving road and air infrastructure in recent years. Special laws have been issued regulating expropriation of land, planning and building of roads to facilitate quick development in this area. Wherever you go in Poland you can see new express roads and motorways being

“In 2013, the environmental revolution will continue in Poland.”

With regard to environmental protection, the European Union is pressing hard for a reduction of all kinds of pollution. It is also providing vast amounts of money to help countries implement its requirements.

Many new instruments and permits have been introduced into law to better control exploitation of the environment. As a result, air and water pollution has decreased significantly in Poland over the last few years. The City of Warsaw has just finished construction of its ultra-modern “Czajka” sewage treatment plant in the Bia∏o∏´ka district which, together with the recently upgraded “Po∏udniowa” sewage treatment plant in Wilanów, will be able to clean almost all sewage produced in the Warsaw metropolitan area. Previously, most sewage produced in Warsaw was dischaged directly into Vistula River without any special treatment. Similar projects undertaken in many other cities in Poland will bring huge relief to the Polish environment.

In 2013, the environmental revolution will continue in Poland. In July

2013, a law regulating new rules of waste management by municipalities is to be fully implemented. After July 2013, all municipalities in Poland are to be responsible for collection of all waste in their respective areas. It is municipalities, and not individual residents, who will be obliged to conclude agreements with the entities collecting waste. Residents will only have to pay a public charge to the municipality to cover collection of waste, and the charge is to be equal for all residents of the municipality.

However, the charge will be lower for those residents who segregate various types of waste to facilitate their treatment.

Expectations are high that the new regulations will help to eliminate the problem of the illegal (but still common) practice of dumping waste into forests or other areas by those who prefer to save on waste collection agreements. Moreover, the new rules should persuade municipalities to quickly develop the infrastructure necessary to ensure recycling of all Continued on p. 17 ➡

Changes to Polish law in 2012

Przemys∏aw Kastyak Partner, Magnusson przemyslaw.kastyak@magnussonlaw.com

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fter very innovative year in 2011 with many significant changes to the law, the Polish parliament was not as creative in 2012. Most of the significant changes came into force in January and constituted the effect of the parliamentary work in 2011, while the last months of the year have not brought any breakthrough in legislation.

Keeping in mind the financial situation in most EU countries, it was broadly expected that after winning

the elections for the second time in a row, the ruling coalition of Civic Platform (PO) and the Polish People’s Party (PSL) would undertake efforts to force through unpopular reforms to bring down debt and deficit levels.

Eventually, not that many changes influencing the public finances have been introduced.

When it comes to taxation, most entrepreneurs appreciate the amendment to the previous system of income tax advance payments and the abolition of “double paying” those advance payments at the end of each year. Also, the shortening of the limitation period for outstanding social security premiums from 10 to five years will help some debtors sleep well, but will also force the Social Insurance Institution (ZUS) to manage its receivables better. On the other hand, social security premiums were increased from 6 to 8 percent.

New technologies New digitization and internet services were introduced to make doing business easier. After previous regulations were implemented allowing for the use of digital signatures (though these are still not as widely used as expected), and after providing common access to the Land and Mortgage Register via internet, the time came for the Commercial Register.

As of June 28, 2012 the Ministry of Justice launched the service, allowing businesses to obtain excerpts from the commercial register directly from the ministry’s website.

Another IT solution aimed at making life easier for businesspeople came into effect at the beginning of 2012: the possibility to establish a limited liability company via the internet.

The company’s founders have to fill

“The year 2012 has shown that full implementation of the ambitious governmental program prior to Euro 2012 was little more than a dream” in specific forms, available on a government website, and send it via internet after having signed it electronically. A company is registered by the court within one day. Previously, registering such a business typically took weeks.

But new technologies do not always bring good solutions for business. The modern electronic road toll collection system “viaToll” for trucks was launched in July 2011. The sys-

tem is necessary and the general idea is good. However, certain unreasonable detailed regulations have led to serious consequences for transportation businesses. The owners of transportation companies widely complain that the extraordinary severity of fines for relatively small irregularities can result even in bankruptcy.

Infrastructure When it comes to highways and transportation infrastructure in general, the year 2012 has shown that full implementation of the ambitious governmental program prior to Euro 2012 was little more than a dream.

The tournament was a big success for Poland, however many roads and rails initially planned for the spectators were completed after the tournament, or are is still under construction.

It has also been shown that Poland’s public tender system requires amendments. The troubles experienced by companies engaged in the highway construction program, including such giants as PBG and Polimex-Mostostal, have proven that the current tender system forcing price wars between the bidders and transferring nearly all of the risks to the general contractors, leads to bankruptcies of construction companies and their subcontractors, to

delays of contracts and a significant number of court cases. At the same time, as the government waits for the new EU 2014-2020 budget, very few new tenders have been announced in 2012. This hasn’t helped construction companies in their battle to survive these difficult economic times.

As far as construction is concerned, it must be noted that the government continuously disappoints those who are patiently waiting for modern construction and zoning regulations, which would speed up the development and construction process and also bring spatial order to Polish towns. Unfortunately, no major changes to the Construction Law and the Spatial Planning Law have been introduced in 2012. The only visible change was relaxing the allowed noise levels, which should prevent further construction of immense noise barriers along roads and railways in places where it seems unnecessary.

Continued on p. 16 ➡

In this supplement What to expect in 2013 . . . . . . . . . . . . . . .15, 17 Changes to law in 2012 . . . . . . . . . . . . . .15, 16 Civil proceedings . . . . . . . . . . . . . . . . . . . . . . .16 Waste management . . . . . . . . . . . . . . . . . . . .16 Calendar of 2012 changes . . . . . . . . . . . . . . .17 Deregulation of professions . . . . . . . . . . . . .18 Maternity, paternity leave . . . . . . . . . . . . . . .18 Renewable energy sources . . . . . . . . . . . . . .18

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Changes to Polish law in 2012 ➡ Continued from p. 15

Civil Procedure Code

When it comes to development, the new Developers Act, which regulates conditions of sale of residential objects must be mentioned. The new regulation, that has come into force as of April 29, 2012 provides much better protection of a purchaser of an apartment in case of bankruptcy of the developer, as it imposes the obligation to open escrow bank accounts for each purchaser. In addition, the new act ensures that the purchasers will be much better informed about the status of the project. The regulation in fact ends the common practice of selling a “hole in the ground” – buying a house or apartment before its construction even began.

Good news for entrepreneurs (as well as their lawyers) is the amendment to the Civil Procedure Code as of May 2012. After many years of common criticism, the extremely restrictive “commercial procedure,” applicable to cases between entrepreneurs, was finally abolished.

Now, businesses are treated in a similar way and have to meet the same requirements as other participants of the court proceedings. This change was very much needed, as the previous formal rules for commercial procedures were unreasonably restrictive.

This often ended in rejection of a justified claim only for formal reasons.

There were also other changes to the

Civil Procedure Code, including: a simplification of the appeals procedure, amendments to injunctions in copyright disputes and giving more competence to court assistants in simple cases. (For more on these changes, see the article by Marzena Sobaniec below.)

Other changes Complex regulations regarding time-sharing came into effect in April 2012. The new legislation regulates four new types of time-sharing contracts. It also imposes certain requirements for companies offering time-sharing, with special respect to detailed information regarding offered products and services, as well as tools to save clients from dishonest

companies, such as the new conditions justifying termination of the contract, or restrictions for time-sharing companies from demanding certain types of collateral.

In 2012, parts of some revolutionary changes to Poland’s waste-management system came into force. Regulations that were adopted in 2011 required that in 2012, municipalities began doing the groundwork for these big changes, which will officially come into force in July 2013. (For more on changes to the waste management system, see below) A few changes have also been introduced to avoid car owners from double insuring their vehicles – a common enough situation if the owner had forgotten to terminate the

previous insurance policy upon signing a new one with another company.

In addition, parliament is close to completing work on legislation that must be implemented as a result of the European Court’s of Justice verdict resolving that insurance companies can no longer differentiate insurance premiums based on the sex of the client.

This will probably result in a significant increase of premiums for women, who used to pay lower premiums, especially when it came to life and car insurance.

The draft of the new law also includes a ban on the differentiation of premiums based on the criterion of maternity or pregnancy. The new regulations will likely come into force in the very beginning of 2013. ●

Civil proceedings becoming simpler and quicker

Marzanna Sobaniec Attorney-at-law Magnusson marzanna.sobaniec@magnussonlaw .com

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n May 3, 2012 a comprehensive amendment came into force. It’s intention was to simplify the civil proceedings and implement provisions that would facilitate and expedite all types of proceedings irrespective of the nature of litigation.

The Code of Civil Procedure Act (hereafter referred to as “CCP”) from 1964 was updated with almost 150 revisions to particular provisions.

In terms of issues relevant to entrepreneurs, the most fundamental amendment was the liquidation of the separate commercial proceedings (generally defined in Polish as: “prekluzja dowodowa”), which applied exclusively to enterprises (i.e. the companies and natural persons conducting business) and imposed considerable procedural restrictions on entrepreneurs and requirements typical for professional representatives and caused them nuisance compared to other participants in civil proceedings – that is, natural persons not conducting business.

According to the said amendment, the litigation status of both entrepreneurs and other participants to the disputes (i.e. consumers, natural persons) has been declared equal, however, the separate court commercial divisions designated to the disputes between

enterprises remained unchanged.

The articles 207 § 6 and 217 § 2 of the CCP states that as of May 3, 2012, all participants to civil disputes are equally obliged to present, in the very first court pleadings (statement of claim or statement of defense), all their claims and statements applying to the dispute without undue delay. Any and all subsequent claims or statements of parties to a dispute shall be deemed inadmissible, unless the extraordinary circumstances occur, or pursuing delayed evidence shall not result in adjournment of the entire proceedings.

What is confusing from the perspective of natural persons, enterprises and professional advisors, is that the amended provisions require courts to return any and all subsequent written pleadings filed by any party to a dispute without “a court request.” This may be deemed as a breach of the inviolable right of a court and is expected to be subject to further consideration of the Supreme Court and legal doctrine. However, these

reservations shall not apply to court pleadings solely citing new evidence, although such late evidence will also be assessed, provided it complies with the time lines.

A general overview of the amended provisions leads to the conclusion that the lawmakers’ intent was to convert the proceedings from written into verbal form.

This obligates the court to establish the facts of the case through questioning the disputing parties during an open hearing (a sort of court “forensic investigation” proceedings).

It should be also noted that an amendment introduced to the CCP on July 1, 2010, which at that time passed unnoticed in most legal circles, has come into force in both District and Appeal Courts.

That amendment introduced a revolutionary change in the rules of recording the hearings by replacing the old-fashioned written minutes with both visual and audio recording of the hearings (defined as “e-minutes,” in Polish: “e-protokó∏”). A written excerpt from the

audio-visual record of the hearing prepared concurrently, will be limited to the most crucial information, such as an exemplification of participants in the hearings, court decisions issued in its conduct and the bullet points indicating the performed actions and the time of the hearing that will help the parties to follow the record.

A full written transcript of the relevant part of the audio-visual record shall be prepared only in exceptional cases, while a CD record evidencing the conduct of a hearing and given over to the parties to a dispute (for a small handling fee of z∏.6) shall be treated as the rule.

The changes that have been implemented not only allow for the parties to reproduce the recordings of a hearing, but also create difficulties for the parties and professional representatives, who will weigh their words much more carefully than previously. It’s expected that the long-forgotten gift of eloquence will once again be much more highly appreciated. ●

Polish waste management law to change Zuzanna Wencel Magnusson zuzanna.wencel@magnussonlaw.com

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oland is finally on track for full regulation of its waste management sector, as it is moves to fulfill European Union directives. As of July 2013, Poland’s municipalities will be fully responsible for collecting waste from real properties’ owners, following legislation passed by parliament in 2011. Each municipality will also be obliged to conduct a tender procedure to select a waste collection company.

This legislation will significantly affect the waste management business, and from now on will require

that firms are entered into a register maintained by the head of a municipality with jurisdiction over an area from where the waste is collected.

The municipality council will also have to pass a resolution on a local rate, that will determine the basis of a waste collection fee due from the real properties’ owners.

Finally, the municipality will have to choose the place where the waste will be disposed of. Specialists emphasize potential threats to business from this new legislation, claiming that, while defining conditions of the tender, the municipalities may be inclined to favor companies in which they hold shares or the ownership title.

Furthermore, Poland plans to introduce a completely new act on waste, for now passed by the lower chamber (the Sejm) of the parliament on November 23, 2012, since the previous one does not comply with the provisions of EU Directive No 2008/98/EC. Although work on the act is in progress in the upper chamber (the Senate) of the Polish parliament, it is impossible to foresee when the new act will come into force and what its final form will be. However, what we can foresee is that it will constitute a comprehensive regulation on waste management in Poland, as its current version contains some fundamental BROUGHT TO YOU BY MAGNUSSON

changes for the entrepreneurs. It provides for establishing a new register of entities that introduce goods into the market, packaged goods and waste management firms. This register will replace numerous other registers currently maintained for the businesses conducting waste management and will be maintained by the voivodship marshall (Marsza∏ek Województwa). Additionally, the entrepreneurs’ reporting duties on waste management will significantly change. Most probably, instead of submitting several reports on different types of waste, they will be obliged to submit only two of them.

The parliament’s intensified work

on this new act follow proceedings initiated by the European Commission against Poland in connection with Poland’s failure to meet the deadline to implement Directive 2008/98/EC, which could result in severe fines.

In conclusion, all these amendments to Polish waste management law – either already introduced or planned – focus on making the country’s waste management system more modern, eco-friendly and congruent with the European standards. At the same time, however, these changes will significantly affect the conditions for conducting a waste management business in Poland. ●

DECEMBER 24, 2012 – JANUARY 13, 2013

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Upcoming changes to Polish law ➡ Continued from p. 15 suitable waste or efficient burning of non-recyclable waste. Currently, only 14 percent of waste is recycled in Poland, 1 percent is burned, and 7 percent treated biologically. The rest – 78 percent – is accumulated in landfill sites. In Germany, for example, these proportions are entirely different: over 50 percent of all waste is subject to recycling. Many expect that the new rules will trigger a change in Poland and the waste management sector will grow rapidly in the coming years.

For more information on new laws on waste management please see the article by Zuzanna Wencel on page 16.

Renewable energy law A comprehensive law on renewable energy is also excepted in 2013. The law is to regulate the development of all renewable energy sources including, in particular, an incentive system for all types of renewable energy sources, the sale of energy to the supplier of last resort and the process of connecting to the grid. Just as is the case today, under the new law the producers of energy from renewable energy sources will earn their income

from two main sources: the sale of electrical energy and the sale of green certificates granted to the producers by the Energy Regulatory Office (URE) in exchange for production of green energy.

However, in contrast to current regulations, the number of certificates granted by the Energy Regulatory Office, and thus the income to be derived, will vary depending on the source and its size. Taking into account that today the income earned from the sale of green certificates is higher than the income resulting from the sale of electrical energy, certain installations will be promoted significantly more than they are today, and some of them significantly less.

For example, a company producing energy on the basis of photovoltaic installations with a capacity of between 100 kW and 1 MW, located on buildings, will receive 2.85 times more green certificates than it would today, but a firm producing energy on the basis of onshore wind power plants will receive only 90 percent of the green certificates which it receives today.

Although many in the wind power industry may disagree, it is expected

that the law will allow for a more dynamic, but at the same time more rational development of the renewable energy sector in Poland.

For more information on the new law on renewable energy, please see the article by Olav Nemling on page 18.

Spatial planning and efficient administration It would be great to see the same efforts undertaken by the government with regard to other areas that still need work, especially zoning and efficient administration.

Anyone living in Poland for some time would certainly be able to provide a number of examples to prove that these areas are in desperate need of improvement. However, the most clear example, which is also instantly evident to anyone coming to Poland from abroad, is the problem of aggressive, illegal advertisements and billboards which spoil the appearance of cities and the countryside along main roads. This is a typically Polish disease, which for many in Poland is no less annoying than the problem of dumping rubbish in forests. Only a tiny fraction of all these advertisements have all the necessary consents and permits; the majority of them

should be removed since they are illegal. Nevertheless, authorities are reluctant to tackle the problem. They claim that they will only lose time and money fighting them and will fail anyway, unless the law on administrative enforcement and the law on zoning are changed.

So what is the government doing about it? Not very much is the honest answer. For the time being, only a draft amendment to the law on administrative enforcement has been submitted to the Polish parliament.

Interestingly, it was not the government who was the author of the draft but a group of ruling-party MPs frustrated with the damage wrought by illegal advertisements.

In any case, if the amendment is adopted in the shape proposed in the draft, the time necessary to enforce administrative bodies’ decisions would be shortened significantly, including those concerning removal of illegal advertisements.

Hopefully, the amendment will be adopted at the beginning of 2013.

However, there are no reasons to be over-optimistic. The amendment may help in the short run, but in the long run the problem of illegal advertisements may only be resolved by

reforms to the Polish law on zoning.

Unless the quality of zoning is improved and the size of territory covered by some kind of planning is increased (currently only approximately 30 percent of Poland’s territory is covered by some form of local zoning plans), Poland is condemned to develop chaotically and unaesthetically.

What are the government’s plans concerning zoning then? The government has decided to work simultaneously on a liberalization of Polish building law which is to be implemented soon and on an overall reform of Polish building and zoning law which is to be implemented in several years’ time. This does not bode well for spatial order in Poland in the short run. Decreasing the administrative burden connected with building processes is definitely necessary, as there are not many countries in the world in which it takes more time to obtain all the necessary paperwork connected with the construction process. However, it is difficult to imagine how the liberalization of building law without a reform of zoning law may curb the chaotic development. ●

Changes to Polish law in 2012: a calendar January 1: Establishing a company via the internet According to a new regulation, limited liability companies may be created online. To do that, the founders of the company must fill out forms available on the government websites and send it in the same way, after having signed it electronically. A company shall be registered by the court within one day. However, a drawback of this regulation is that the standard forms don’t allow for any changes to be made after the registration. Those still have to be implemented through traditional methods.

January 1: Longer maternity leave The length of additional maternity leave and additional sabbatical on terms of maternity leave is extended. Furthermore, paternity leave reaches 2 weeks.

January 1: General interpretation of tax regulations Everyone is now entitled to apply for issuance of a general interpretation of tax regulations, in order to provide uniform application of controversial tax regulations. According to the former legal status, only the Minister of Finance had the right to issue general interpretations of tax regulations and was rather reluctant to do so.

January 1: New system of municipal waste management According to the new provisions, municipalities are obligated to organize the system of collecting municipal waste from the owners of residential real estates. The council of the municipality determines, by way of a resolution, the maximum fees incurred by the owners of real estates for the municipal waste disposal services, whereas mayors are obliged to organize tender for the collecting of municipal waste.

January 1: New limitation periods for outstanding social security premiums The limitation period has been shortened from 10 to 5 years.

January 1: New tax advance payments regulation Tax advance payments for all months (or quarters), are subject to similar rules, that is, all tax advance payments should be paid by the

20th day of the following month, in which the income was obtained, and in the amount calculated for a given month. Previously, the tax advance payment for December was the same amount as was due in November and by the November deadline, which unreasonably affected businesses’ cash flow – it essentially necessitated that businesses paid double the advance tax payment.

February 1: increase of social security premiums The annuity premium was increased to 8 percent.

February 11:

Obligatory transportation insurance regulation amended The new regulation avoids the double-insurance of one car, in cases when the owner has forgotten to terminate previous insurance policy upon signing a new one with a new company. The regulation concerning the termination of the obligatory insurance policy when a car is sold was also amended.

April 28: New time-sharing regulations The act regulates four new types of time-sharing contracts, and introduces increased requirements for companies offering time-sharing. It requires detailed information regarding offered products and services, as well as tools to protect clients from dishonest companies. A right to terminate the contract and a ban on time-sharing companies demanding certain types of collateral is introduced.

May 3: Major Amendments in Civil Procedure Code The amendment to the Civil Procedure Code significantly changed the civil procedure in Poland. Among many changes, the abolishing of the highly restrictive separate “commercial procedure,” applicable to cases between entrepreneurs, should be noted. This change is very welcome, as the rules for commercial procedures were far too restrictive. Other changes to the Civil Procedure Code include: simplification of the appeal procedure and abolishing certain restrictions connected with appeals of second instance, amendments to injunctions in copyrights disputes, and more competences for court assistants in simple cases.

July 21: New grounds for exclusion in public procurement The provisions of the act on public procurement were tightened again. The existing list of prerequisites allowing the exclusion of the contractor from the proceedings for the benefit of a public order has been expanded. An entrepreneur may be excluded also if he (or in the case of a company, its shareholder or a member of the management board) has been convicted of unlawful employment of foreign citizens illegally staying in Poland.

August 15: Obtaining citizenship

April 29: Developer Act

According to the new provisions, all foreigners lawfully residing in Poland for three years are entitled to Polish citizenship. Previously, five years of residence was required and foreigners were allowed to obtain Polish citizenship only if they had unspecified or no official citizenship.

As a result of the new regulation, a purchaser of an apartment will be better protected if the developer goes bankrupt. Each client, before signing the agreement with the developer, will obtain the so-called “informational prospectus” containing specific data concerning the developer. Moreover, the new law requires developers to set up an open-end or closed-end escrow account for every purchaser. Regarding the open-end escrow account, the bank will transfer the collected funds only upon the completion of the given investment stage. The funds accumulated in the closed-end escrow account are disbursed upon the completion of the entire investment.

October 23: Requirements of road noise protection relaxed After a big public debate, the Ministry of Environment finally increased the allowed levels of noise along public roads, to stop the wave of construction of immense noise barriers along newly constructed highways as well as reconstructed streets in towns. The previous regulation was widely criticized as exaggerated and leading to unnecessary waste of public money and destruction of Polish landscape. ●

BROUGHT TO YOU BY MAGNUSSON

18

LAW IN POLAND

www.wbj.pl

DECEMBER 24, 2012 – JANUARY 13, 2013

Extension of maternity Deregulation of certain professions and paternity leaves Wioletta Kuliƒska Magnusson wioletta.kulinska@magnussonlaw.com

T

he Ministry of Justice is planning to deregulate certain professions. There are 380 regulated occupations in Poland – a record number in European Union. In comparison, German law regulates 152 professions, while in the UK 217 professions are regulated.

The European average is approximately 150.

The government claims that this kind of over-regulation hinders Poland’s growth.

Therefore, it decided to completely open or facilitate access to a number of professions by limiting requirements for apprenticeships or higher education. In addition, certain professions will be released from the supervision of local government institutions.

Pursuant to the reform, three packages of laws will be implemented gradually. The first, which, as WBJ went to press, was being discussed in parliament, introduces amendments to approximately 50 professions in the fields of law (public notaries, legal counsels, court enforcement officers), real estate (real estate agents, real estate managers, surveyors), road traffic (driving instructors, examiners) security services, tourism, and others.

The second package, which would deregulate around 90 professions mainly in the financial, construction and transport sectors, awaits an approval of the Government Legislation Centre.

The first and the second package should enter into force in 2013. The scope of the third one is being discussed by the government and would follow shortly after the second one. ●

Izabela ˚mijewska Magnusson

izabela.zmijewska@magnussonlaw.com

A

package of bills prepared by the Ministry of Labor and Social Policy, has been accepted by the government for further legislation. The regulations aim to make it easier for parents and guardians who have a career to raise their children.

The most fundamental change regards the extension of the maternal leave period from the current 24 weeks (a base of 20 weeks and 4 additional weeks) to one year. There will be two possible scenarios, according to the planned changes.

The first will consist of a base of 20 weeks and an additional 6 weeks of leave, which will be paid in full by employer. The second will allow parents to take a further 26 weeks of additional leave, but they will receive 80 percent of their wages for that period.

According to another amendment, during the first year of a child’s life the parent will be able to divide the second part of the leave into three periods with possible breaks to return to work. Parents will also have the right to transfer the additional part of the leave from one to the other. The regulations for the extended leave are due to enter into force on September 1, 2013.

Furthermore, the lawmakers want to encourage parents to gradually return to work.

Therefore, after the 20th week of leave, it will be allowed to both collect the maternity allowance and work on a part-time basis.

Also, in an adjustment of Polish law to European Union directives, one month of the parental leave must be used by the other parent.

Moreover, the part of the leave which may be simultaneously used by both parents will be extended from 3 to 4 months. ●

Long awaited act on renewable energy sources Olav Nemling Magnusson olav.nemling@magnussonlaw.com

T

he renewable energy industry is impatiently awaiting the adoption of the law on renewable energy sources (RES), implementing the directive on the promotion of the use of energy from renewable sources (2009/28/EC) into the Polish legal system. The first draft of RES Act was published by the Ministry of Economy in December 2011. It contained many controversial solutions which were withdrawn from the second draft. The slightly modified version was pub-

lished by the Ministry at the beginning of October 2012. The general idea behind the proposed regulations is a more flexible incentive system and the promotion of certain kinds of RES, as well as of small and micro-installations.

The RES Act upholds and supplements the current incentive system, based on certificates of origin and compensation fees. The new act introduces so-called correction coefficients, based on which certain types of RES are promoted distinctively. Producers of green energy from onshore wind parks above 500 kW will receive 0.9 certificates per MW instead of current 1.0 certificate per MW. On the

other hand, offshore wind energy will be promoted by a correction coefficient of 1.8. The correction coefficients will be updated 3 years into each 5-year period. Correction coefficients which were once determined for a project will be applied to this project for a period of 15 years. The first correction coefficients will be set forth in the final RES Act and will be binding until 2017.

The legislation introduces feed-in tariffs for small and micro-installations. Depending on the source, the total capacity of small and microinstallations may vary. With regard to wind energy, a “micro-installation” cannot exceed 40 kW and the capaci-

BROUGHT TO YOU BY MAGNUSSON

ty of a “small installation” may vary between 40 kW and 200 kW. The above regulations will probably disappoint investors who were hoping for a switch from the current certificate system to feed-in tarrifs.

According to the draft RES Act the compensation fees (which traditional energy producers pay to the Energy Regulatory Office if they don’t have enough green certificates) will be fixed at their current level of z∏.286.74 per MW/h and will not be subject to indexation. Consequently, a loss of value over the years is inevitable. The industry is highly critical of this proposal.

Another controversial proposal is

Art. 61 sec. 2 of the draft RES Act. It states that producers of energy from RES will not receive certificates of origin for energy sold to suppliers of last resort at a price higher than 105 percent of the price for “black energy” (traditionally generated, polluting energy, such as that generated from coal) determined annually by the Energy Regulatory Office. Such regulation appears to be contrary to the free market principle and may not be in line with Polish and EU Law. The final version of the RES Act is expected to be adopted in 2013.

Due to recent changes in the Ministry of Economy delays may not be excluded. ●

THE LIST

DECEMBER 24, 2012 – JANUARY 13, 2013

www.wbj.pl

19

Corporate Services

Certification Centers

Total revenue (z∏. mln)

Certificates issued

1st half of 2011 / 2010 / 2009 / 2008

1

TUV NORD Polska Sp. z o.o. ul. Mickiewicza 29, 40-085 Katowice 32 786-4646/32 786-4601 biuro@tuv-nord.pl www.tuv-nord.pl

8.6 16.0 17.8 17.8

WND WND WND WND

412 865 939 1,005

Industries in which company specializes

✓ ✓ ✓

✓ ✓ ✓

Coal mining; services; medical; food industry; automotive

www.bookoflists.pl

Certificates

International cooperation (organizations)

Selected clients

Total number of employees / Year founded in Poland

Certification revenue (z∏. mln)

Certification of: Systems / Products / Employees

Company name Address Tel./Fax E-mail Web page

Range of activity: Certification / Training / Verification

Rank

Ranked by certification revenue in 2010

Top local executive / Title

ISO 9001; ISO 13485; ISO 14001; ISO 22000; ISO 27001; PN-N 18001; AS 9100; ISO/TS 16949; BRC; IFS; HACCP

WND

JSW; GTL

115 1994

Henryk Warkocz

Anwil; Nestle; Danone; Areva; Citibank; Kompania Piwowarska; Auchan; Carrefour; Grupa ˚ywiec; Animex; ISD Huta Cz´stochowa; PKN Orlen; Zak∏ady T∏uszczowe Kruszwica; Swedwood; Jutrzenka Colian; Toruƒ-Pacific; Rawag; Polmor; Motorola; 3M Poland; ABB; ADM; Agros Nova; Alstom; Modni Packaging; Foster Wheeler; Raben; Fresh Logistic; Kamis; KGHM; Knorr-Bremse; ZPC Mieszko; Drosed; Kosmepol; PGE; Philips Lighting; Pratt & Whitney; Ricoh; Stell Gas; Soko∏ów; ThyssenKrupp; TZMO; Zak∏ady Azotowe Pu∏awy; Zbyszko; Citroën; Volvo

37 1996

Bogdan Sperski

ISO 9001; ISO 14001; ISO 18001/ OHSAS; EMAS; SA8000; CSR; GRI; SMETA/ SEDEX; ISO 27001; ISO 20000; BS 25999; ISO 28000; ISO 29001; TL 9000; IRIS; ISO/TS 16949; AS/EN 9100; TAPA; SQAS; ISO 22716; EN 15593; EN 15038; BRC loP; ISO 22000; PAS 220 UKAS; ANAB; DAR; IATF; (ISO/TS 22002-1); FSSC 22000; IFS CEFIC; HDE; BRC; FoodPlus; Food; BRC Food; IFS Logistics; IFS PDV; TGA; SAS; SAI; DANAK; Broker; GlobalGAP; MSC CoC; FAMI-QS; FSC; PEFC; IRIS; ITSMS; Q&S; IFIS; GMP+; GTP; FSC CoC/FM; ENAC; COFRAC PEFC; GHG; JI/CDM; ISO 14064; GIS; ISO 24510:2007; ISO 24511:2007; EU ETS Aviation; Suppliers Audits; 2nd Party Audits; Traceability Audits; Sustainability Report Assurance; ISCC; REDCert; ISO 50001

President

2

Bureau Veritas Polska Sp. z o.o. ul. Migda∏owa 4, 02-796 Warsaw 22 549-0400/22 549-0410 biuro@pl.bureauveritas.com www.bureauveritas.com

WND 13.4 12.5 12.5

WND 43.1 43.7 36.4

WND 445 514 501

✓ ✓ ✓

✓ ✓ -

All sectors

3

DET NORSKE VERITAS POLAND BUSINESS ASSURANCE Sp. z o.o. ul. ¸u˝ycka 6E, 81-537 Gdynia 58 511-5020/58 511-5044 certification.pl@dnv.com www.dnv.pl

6.5 13.0 14.4 14.4

WND WND WND WND

WND WND WND WND

✓ ✓ ✓

✓ ✓ ✓

Healthcare; IT; telecom; energy; food industry

ISO 9001; ISO 14001; OHSAS 18001; PN-N 18001; SCC; BRC IoP; IFS; BRC; ISO 22000; ISO 27001; BS 25999; ISO 20000; ISO 13485; CE MED; TS 16949; TL9000

WND

WND

26 1992

Tomasz Gasiƒski

4

DEKRA Certification Sp. z o.o.

Plac Solny 20, 50-063 Wroc∏aw 71 780-4777/71 780-4779 poczta@dekra-certification.pl www.dekra-certification.pl

5.8 10.3 WND WND

6.0 10.6 WND WND

682 1,401 WND WND

All sectors

ISO 9001; ISO 14001; PN-N 18001; OHSAS 18001; ISO/TS 16949; ISO 22000; HACCP; IFS; GMP; ISO 27000; ISO 9100; ISO 22716; ISO 20000; ZKP; SCC/VCA; REDcert; ISCC; Clean Treatment; EuropeSPA; external audits; mistery shopper audits; IRIS; PN-EN 15038; SQAS; PN-EN 15593; CE; GS; KEMA-KEUR

DEKRA

Philips; Bosh; ABB; LG Electronics; Polkomtel; Polimex-Mostostal; Mota Engil; Kappa; HDI; Rossmann; Carrefour; Eurocash; Polomarket

42 2001

Roman Zadro˝ny

5

Polski Rejestr Statków SA – Biuro Certyfikacji Systemów Zarzàdzania Al. Gen. Józefa Hallera 126, 80-146 Gdaƒsk 58 751-1273/58 341-7749 dc@prs.pl www.prs.pl

2.5 4.0 4.5 4.5

WND WND WND WND

1,972 1,931 1,866 1,720

✓ ✓ ✓

✓ ✓

25 1994

Jacek Papiski

6

Instytut Nafty i Gazu ul. Lubicz 25A, 31-503 Kraków 12 421-0033/12 421-0050 office@inig.pl www.inig.pl

0.6 1.2 1.2 0.9

0.6 1.2 1.2 0.9

66 140 98 107

✓ -

✓ ✓ -

BSI Group Polska Sp. z o.o. ul. Królewska 16, 00-103 Warsaw NR 22 330-6180/22 390-4470 infopoland@bsigroup.com www.bsigroup.pl

WND WND WND WND

WND WND WND WND

WND WND WND WND

✓ ✓ ✓

✓ ✓ -

Centrum Certyfikacji ul. Kobierzyƒska 58/40, 30-363 Kraków NR 12 266-1470/12 266-1470 certyfikacje@gmail.com www.certyfikacje.pl

WND WND WND WND

WND WND WND WND

WND WND WND WND

✓ ✓ ✓

✓ ✓ ✓

Instytut Zaawansowanych Technologii Wytwarzania ul. Wroc∏awska 37A, 30-011 Kraków NR 12 631-7100/12 633-9490 ios@ios.krakow.pl www.iztw.krakow.pl

WND WND WND WND

WND WND WND WND

96 269 220 209

✓ ✓ ✓

✓ -

TÜV SÜD Polska Sp. z o.o. ul. Podwale 17, 00-252 Warsaw NR 61 850-7408/61 855-7652 tuevpolska@tuevpolska.pl www.tuevpolska.pl

WND WND WND WND

WND WND WND 7.6

1,447 1,413 1,038 WND

✓ ✓ ✓

✓ ✓ -

✓ ✓ ✓

Notes: Notes: NR = Not Ranked, WND = Would Not Disclose. Research for The List was conducted in September 2011. Number of employees is as of August 2011. All information pertains to the companies’ activities in Poland. Companies not responding to our survey are not listed.

✓ ✓ ✓

Mining; construction; transport equipment; trade; accomodation and services; ISO 9001:2008; ISO 14001:2004; PN-N H. Cegielski - Poznaƒ; Apator; Klimor; tax activities; finance and 18001:2004; PN-EN ISO 22000:2006; Germanischer Lloyd Industrial Gdynia Maritime University; Gdaƒsk City insurance; real estate; EMAS; PN-ISO/IEC 27001:2007; PN-EN Services Polska; Bureau Hall; The Marshall’s Office of administration; metal ISO 3834; PN-EN 16001:2009; ISO/TS Veritas Certification; LRQA Zachodniopomorskie Voivodship in industry; machinery; 16949:2002; PN-EN ISO 9001; PN-EN Polska; DET NORSKE VERITAS Szczecin; Silesian Center for Heart electronic and optical ISO/IEC 13485:2005; PN-EN Polska Diseases in Zabrze equipment; IT; healthcare; 45011:2000 social services; agriculture; food industry

President

President

President

Director

Gas installation and equipment; water supply fittings; chimneys

EC Type Examination Certificates; Management System Certificates; Certificates of Factory Production Control; Certificates of Conformity; Security and Quality Certificates

WND

WND

WND 1993

Maria Ciechanowska

All sectors

ISO 9001; ISO 14001; EN 16001; ISO 50001; GHG; CHP; ISO 18001/OHSAS; EMAS; SA8000; CRS; ISO 26000; ISO/IEC 27001; ISO/IEC 20000; BS 25999; ISO/TS 16949; ISO 13485; ISO 22000; PAS 99; PAS 220; IFS; TL 9000; SRA; ISO 29001; IRIS; CCA; AS9110; AS9120; ISO 20252

WND

WND

27 1999

Joanna Baƒkowska

GOST R; UkrSepro; Ex; RTN; certificates Documentation for exporters of compliance for the mining industry; to Russia and Ukraine metrological certificates; fire certificates; sanitary certificates

ICSTI

WND

WND WND

WND

Machinery and equipment

Certificates of Conformity; Security and Quality Certificates

WND

WND

WND 1949

Maria Zybura

All sectors

ISO 9001:2008; ISO 14001:2004; BS OHSAS 18001:2007; ISO/TS 16949; HACCP; ISO 22000; IFS; BRC; GMP+; FAMI-QS; GlobalGAP; ISO 27001; IRIS

IATF; DAR; DAKKS; BRS

WND

46 1998

Krzysztof Jankowski

Director

Managing Director

Director

President

To the best of WBJ ’s knowledge, the information is accurate as of press time. While every effort is made to ensure accuracy and thoroughness, omissions and typographical errors may occur. Corrections or additions to The List should be sent, on official letterhead, to Warsaw Business Journal, attn. Monika Brysiak, ul. Elblàska 15/17, 01-747 Warsaw, via fax to (+48) 22 639-8569, or via e-mail to wbjbol@wbj.pl. Copyright 2012, Valkea Media SA. The List may not be reprinted or reproduced in whole or in part without prior written permission of the publisher. Reprints are available.

Lokale Immobilia talks to analysts and developers about the prospects for 2013

The Polish market saw several blockbuster transactions in 2012 21

22-23

LOKALE IMMOBILIA

W a r s a w B u s i n e s s J o u r n a l ’s w e e k l y s u p p l e m e n t o n r e a l e s t a t e , c o n s t r u c t i o n a n d d e v e l o p m e n t

DEC 24, 2012 – JAN 13, 2013, LI 17/51-52

Skyscrapers

The investor wants to build a skyscraper in downtown Warsaw that would combine public and commercial functions Real estate investor Griffin Group has submitted an offer to Warsaw City Hall which, if accepted, could enable the development of a new office tower that the firm wants to build in the

In this issue New Warsaw tower . . . . . . . . . . . . .20 Largest 2012 deals . . . . . . . . . . . . . .21 2013 forecast . . . . . . . . . . . . . . . .22-23 New Europlan offices . . . . . . . . . . .25 Property-related stocks . . . . . . . . .25

city’s downtown.

In September of 2012, Griffin acquired privatized furniture company Meble Emilia, whose assets include a former furniture store tucked between the InterContinental hotel and the Warsaw Financial Center high-rise buildings in Warsaw’s central business district.

The company was hoping to replace the store with a modern skyscraper building, yet soon after the purchase it turned out that the existing structure had, during the acquisition process, been entered in the historical property register, making it illegal to demolish.

Warsaw City Hall wants to see the building preserved. And since May of this year, it has been housing

the Museum of Modern Art, which is expected to stay on the premises until it gets a building of its own in a few years’ time. According to Griffin, a new skyscraper built on the site could, apart from commercial space, accommodate the museum on its first few floors.

The company revealed the details of a planned tower called Nowa Emilia, whose height would be similar to that of the nearby InterContinental hotel building and which would offer a total of around 41,000 sqm of leasable space.

Approximately 6,000 sqm of space in the skyscraper, which, Griffin says, would be developed within three and a half years if the city agreed to

it, could be leased by the museum at a preferential rate.

“For the same amount that is necessary to build a site for the museum, the city could lease the needed space for 80 years,” Griffin Group president Przemys∏aw Krych told journalists in midDecember. The Museum of Modern Art building planned by the city is valued at over z∏.270 million.

Griffin expects the municipal authorities to respond to the offer by mid-January. As Lokale Immobilia went to press, there was no official statement from Warsaw City Hall on the company’s proposition or the skyscraper project itself.

Adam Zdrodowski

COURTESY OF GRIFFIN GROUP

Griffin seeks compromise over Meble Emilia controversy

The planned tower would deliver 41,000 sqm of GLA

LOKALE IMMOBILIA – REAL ESTATE

DEC 24, 2012 – JAN 13, 2013

www.wbj.pl

21

Top transactions in 2012

Prime assets push up volume Multi-million euro blockbuster deals sent transaction volumes in 2012 to over €2.4 billion

COURTESY OF JONES LANG LASALLE

The sales of the Z∏ote Tarasy retail-office complex, the Platinium Business Park and the Twarda Tower skyscraper guaranteed that Warsaw maintained its leading position in the region in terms of real estate volume transacted. The €390 million sale of Manufaktura Shopping Center in ¸ódê added to the figure, meaning this year’s transaction volume in Poland should come in at around €2.4 billion, experts say. The number is approaching the pre-crisis levels seen in boom years such as 2007.

Although bank financing for real estate has been difficult to obtain in Poland in recent years, lending institutions were willing to provide credit for prime assets. The country is still perceived by the international community as the leading Central and Eastern Europe property investment market.

“The value of all transactions for 2012 in Poland should slightly differ from last year’s, which amounted to €2.5 billion. It should come in

fund managed by BPT Asset Management A/S. Experts estimate that the 10-year-old building, comprising 27,000 sqm, could have cost nearly as much as Warsaw Financial Center – an office tower at the intersection of ul. Emilii Plater and ul. Âwi´tokrzyska. The 144meter-tall WFC was sold in August for €210 million to a consortium of Allianz Real Estate and the Curzon Capital Partners III Fund by CA Immo and Pramerica Real Estate Investors. It has approximately 50,000 sqm of office space.

Other transactions

The sale of the Warsaw Financial Center for €210 million was one of the largest deals in 2012 at around €2.4 billion,” said Marcin Purgal, senior consultant at Savills Poland’s investment department.

Biggest deals The acquisition in March of Warsaw’s landmark Z∏ote Tarasy was the biggest transaction whose price was disclosed in 2012. A fund managed by AXA Real Estate and CBRE

Property Fund Central Europe paid €475 million for 77 percent of the property. The investment comprises 205,000 sqm and features 1,600 parking spaces, attracting 20 million customers a year.

The acquisition of Manufaktura Shopping Center in ¸ódê at the end of October came in second, as Union Investment Real Estate paid UniImmo:

Deutschland €390 million for 91,000 sqm of the 112,000 sqm of its total space. The biggest, and arguably the most unique, shopping and entertainment center in Poland is home to two large retail stores, and over 300 retail outlets and restaurants.

It remains a secret how much Europa Capital LLP paid for the Twarda Tower skyscraper, previously owned by a

The sale of several business parks in Warsaw were also high-profile. These included the recent Heitman European Property Partners IV acquisition of Marynarska Business Park from Aberdeen Immobilien. The class-A office complex, with a total space of about 45,000 sqm, is situated in the heart of the Mokotów business district.

Another big transaction was announced in December, when Deka Immobilien bought the International Business Center in downtown Warsaw for €.148 million. The seller of the building, which is sit-

uated near the Politechnika subway station, was Accession Fund SICAV. PwC, Samsung, Provident and Bank Pocztowy are current tenants in the building, which holds 37,000 sqm of office space.

The third large office-complex deal was the €139 million Platinium Business Park acquisition. The Allianz Real Estate Group acquired the property of 56,000 sqm at the intersection of ul. Wo∏oska and ul. Domaniewska in Warsaw’s Mokotów district, from Globe Trade Center in late October.

Experts say 2013 will be at least as successful as 2012.

“Provided the supply of attractive real estate in all the sectors, we can expect that 2013 will bring a few spectacular deals,” said Mr Purgal. “But the banking institutions will play an important role in creating the market, as they decide on financing the transaction,” he added.

“Taking into account Poland’s development rate, its stability and the diversity of investment products, we can presume that the value of all transactions for 2013 will be similar to this year’s.”

Karolina Kowalska

22

www.wbj.pl

LOKALE IMMOBILIA – REAL ESTATE

DEC 24, 2012 – JAN 13, 2013

Polish property market in 2013

Cautious optimism The near future is expected to bring more good than harm to the real estate market in Poland

Optimistic office Despite slowing GDP growth in Poland, demand for office space in the country has been on the rise of late, with Warsaw expected to have seen a higher total lease volume in 2012 than in the very

good year of 2011.

“In many Polish agglomerations, including Kraków, Wroc∏aw and Tri-city, the amount of space leased in the first three quarters of 2012 exceeded the level seen in the whole of 2011,” said Joanna

COURTESY OF PARTNER OF PROMOTION

The Polish property market will be in relatively good

shape in 2013, although some worrying symptoms have already emerged, said analysts and developers interviewed by Lokale Immobilia about their forecasts for the near future of the particular sectors.

Nearly 700,000 sqm of office space is under construction in Warsaw, including in Ghelamco’s Marynarska 12

Mroczek, director of consultancy and research at CBRE. Developers are responding to the trend with increased building activity. New office supply in Poland is expected to total approximately 600,000 sqm in 2012. In Warsaw nearly 700,000 sqm of space is now under construction.

In Poland’s eight largest regional cities a total of 510,000 sqm is being built.

CBRE analysts predict that over the next two years, more office space will be added than the market will be able to absorb in the short-term perspective, which could result in a rise in vacancy rates in many of the major locations.

According to Jaros∏aw Zagórski, commercial and business development director at Ghelamco Poland, the Polish office market is in good shape, both in Warsaw and the regional cities, despite the uncertain macroeconomic situation in the euro zone.

“The forecast for 2013 is also optimistic,” Mr Zagórski said, adding that Warsaw in 2012 saw a record office lease volume of approximately

550,000 sqm. Judging by the activity of tenants who have already started looking for new space, he said, the new year should end with a similar result.

He stressed, however, that in the long term the office market could be seriously affected if the Polish economy slows down. “The condition of the market in 2014 and in later years will be much more dependent on the macroeconomic situation in Europe,” Mr Zagórski said.

“Unless the macroeconomic situation changes drastically, we are not planning to decrease Ghelamco’s activities and our plans for the next four to five years allow for the delivery of another 400,000 sqm of office space,” he added.

Active retail The year 2012 saw a decrease in the volume of new retail supply in Poland, but there is still a lot of development activity in the sector, said Monika Rajska-Woliƒska, managing partner at Colliers International in Poland.

“Although the supply of

Idea – business – success! Zacznij.biz Zacznij.biz – idea – business – success, is a business competition organized by the Polish Confederation atio on of Private e Employers Lewiatan Lewiattan and Lewiatan e an Business Angels. On December 1, 2012, 2 the third edition of the Zacznij.biz competition was launched. The idea behind the contest is to promote entrepreneurship, trrepren neurship, ass assist s in preparing b sist business usiness plans nss and a attract investors – business angels – to work with the best ideas.

The prize for those who enter the best ideas into the competition is to interest potential investors from Lewiatan Business e ess Angels. The e competitions competitio tions itself is a unique opportunity for entrepren entrepreneurs. neurs. A good n idea is a necessary but not sufficient condition to receive funding – the ability to execute, experience, commitment (including ud uding a financial financia al commit commitment), mitment), and a properly written business plan are of o key importance. Many entrepreneurs underestimate the importance of having the idea properly thought through and presented o on paper. Cont Contestants testants nts can take part in several free training sessions and d workshops conducted by experienced experts cooperating with Lewiatan Business Angels. In addition, participants will have a chance ce c to prepare re a comprehensive co business plan and acquire the knowledg knowledge ge and skills g for effective presentation of their business ideas.

Zacznij.biz – idea – business – success, is aimed at: • micro- and small enterprises with big growth potential, operating in the hi-tech sector, seeking to raise capital for development opment and opme d implementation imple implemen me tation of new technologies tech echnol nologi ogies e • academics: researchers, graduate students and students of technical universities, who want to commercialize their innovative va vative ive ideas • entrepreneurs with the projects operating in the ICT sector with global growth potential To participate in the competition, register at www.zacznij.biz.pl and fill in the proper form available on the website. Applications ns are ar being ng accepted a from December 1, 2012 to January 31,, 2 2013.

013 The most promising ideas will be presented at the Final Gala in May 2013.

Last two editions saw over 300 projects submitted representing different business sectors. The finalists from previous editions are i.e. Homplex plex and d Egzotech.

E Organizers of the competition: PKPP Lewiatan The Polish Confederation of Private Employers Lewiatan (PKPP Lewiatan) was established in January 1999 as a nationwide representation of employers to the e sta state tate and trade unions unions. ns. Tod Today day it is an organization of 62 sector and regional associations of private employers and 25 individual members. Thus, in total, about 3,750 companies employing over 700,000 workers rkers ers are a represented represen ented by

by PKPP Lewiatan.

Le Each association is an autonomous organization that brings together individual enterprises, each possessing its own statute and management.

For more information visit: www.pkpplewiatan.pl Lewiatan Business Angels Lewiatan Business Angels (LBA) is the most active Business Angel network in Poland. It was established in 2005 with the use of EU funds under the brand of the Polish Confederation ed deration of Private Emp Employers Lewiatan. LBA matches entrepreneurs who have innovative ideas and ambitious development plans with private investors (so called Business Angels). Its main goals are to prom promote mote Business A Angels investing in Poland, to match private investors with companies seeking funding for growth, to exchange experience and to encourage best practices.

For more information visit: www.lba.pl

This Project is co-financed with European Union Funds from European Regional Development Fund.

LOKALE IMMOBILIA – REAL ESTATE

DEC 24, 2012 – JAN 13, 2013

Warehouse destinations Warehouse space (sqm) currently under construction in major warehouse locations in Poland 80,000 70,000 60,000 40,000 30,000 20,000 10,000 ń

n

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modern retail space in Poland in 2012 was approximately 28 percent lower than in the previous year, the level of developers’ activity in the sector still remains high,” Ms RajskaWoliƒska said.

She added that currently construction is underway on approximately 750,000 sqm of retail space in Poland and that according to her company’s forecast, some 550,000 sqm of shopping center space will be added in 2013.

The largest retail projects scheduled to open in 2013 include Europa Centralna in Gliwice, Galeria Bronowice in Kraków, Poznaƒ City Center in Poznaƒ, Galeria Katowicka in Katowice and Wzgórze in Gdynia, which is now being expanded, Ms Rajska-Woliƒska said.

Agata Brzeziƒska, country

Source: CBRE

manager at Neinver Polska, said that 2012 had a significant impact on the pace at which the Polish retail market is maturing. Both property managers and tenants are now more cautious and negotiate longer, which has a positive influence on their relations, she added.

In 2013, Neinver Polska will open its Factory Warszawa Annopol and Galeria Katowicka retail projects in Warsaw and Katowice respectively.

“Our example shows that it is possible to develop in difficult times,” Ms Brzeziƒska said.

Cautious logistics Caution will characterize the behavior of both developers and tenants in the warehouse market in 2013, according to Tomasz Olszewski, director of the warehouse and industrial

COURTESY OF CUSHMAN & WAKEFIELD

50,000

Neinver Polska is set to open its Galeria Katowicka mall in 2013 department in CEE at Jones Lang LaSalle.

Mr Olszewski said that demand in the sector will remain limited and that lease deal extensions will account for a substantial part of it.

Some of the most active tenants will be logistics operators, retail chains and foreign companies building production facilities in Poland.

He added that developers should focus on safe pre-let investments next year. However, not every company will be able to negotiate such contracts, as they are usually signed for the period of at least five years.

In fact, developers now often require that a lease contract be signed for as many as 10 or 12 years, since this is what banks financing warehouse developments expect

them to do. Speculative investments, which are attractive from tenants’ point of view, are now rare in the market, Mr Olszewski said.

Bo˝ena Krawczyk, investment director for Central Europe at warehouse and industrial space developer SEGRO, said that worries about the macroeconomic situation now are making the market more and more demanding.

The company expects that economic slowdown and rising unemployment will result in more caution on the part of tenants. It also expects banks to continue their current restrictive lending policies in 2013.

Nevertheless, next year SEGRO will continue to expand its portfolio of logistics and industrial property in key destinations located near

Poland’s main transport routes, including Silesia, central Poland and Poznaƒ, Ms Krawczyk said.

She added that construction is currently underway on the development and extension of the company’s distribution parks in Wroc∏aw, Tychy, Gdaƒsk and Stryków. “Next year we are also planning major expansion in the Warsaw area,” Ms Krawczyk said.

Stable residential Home Broker and Lion’s House brokers predict that the year 2013 will witness lower demand in the primary residential market, largely due to the expiry at the end of 2012 of the popular “Family on its Own” state-subsidized mortgage program for first-time home buyers.

On the other hand, this

www.wbj.pl

23

could, at least partly, be offset by the expected continuation of banks’ liberalization of mortgage lending policies and rise in the amount of money that an average family will be able to borrow to finance a home purchase.

A recent report by Home Broker and Lion’s House said that the year 2013 is likely to see the end of the depreciation of apartment prices. It added that small units are likely to remain in demand, while larger homes may prove more difficult to sell.

According to S∏awomir Horbaczewski, vice president of the management board of developer Marvipol, the residential market will be regaining its balance in 2013, rather than plunging into crisis, as it is often predicted to do by the media.

He admitted that developers are now focusing on the sale of their home surpluses, rather than on building land banks, but noted that Poland’s still huge housing needs will continue to drive up demand.

Mr Horbaczewski said that giving up on investment plans would be a mistake and that developers will rather consider restructuring costs. He added that he does not expect the number of apartments completed in the near future to drop below around 110,000 per year.

Adam Zdrodowski

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LOKALE IMMOBILIA – REAL ESTATE

DEC 24, 2012 – JAN 13, 2013

Office

Europlan announces new office project in Warsaw Developer Europlan has announced a new office project, which it plans to build at the intersection of Al. Sobieskiego and ul. Sikorskiego in Warsaw’s Mokotów district. The scheme will provide over 7,700 sqm of office space by the end of 2014.

The development, which will be located on ul. Mangalia near the Stegny ice rink, will be a six-storey facility featuring a glazed facade. It will have green building solutions and is expected to obtain a BREEAM certificate of energy efficiency and environmental performance.

Each floor in the investment will comprise from 1,100 sqm to 1,340 sqm, used as an open space or divided into rooms, with all the floors, apart from office space, expected to also house some amount of retail areas.

Europlan is touting the location of the planned project, saying it is well-connected with the city center through the bus and subway service.

COURTESY OF EUROPLAN

The six-storey building will provide more than 7,700 sqm of office space

The scheme will be ready in Q4 2014 The nearest bus stop enables easy access to nine subway stations and there is a shuttle bus to the nearest of these (Wilanowska).

The developer expects to secure a building permit for the scheme within the next few months and launch construction on the development in April 2013. The investment is scheduled to be completed in

the last quarter of 2014.

The planned office building in Mokotów is Europlan’s second major office investment in Warsaw. The company has just obtained an occupancy permit for its Feniks office project on ul. ˚elazna in the city’s Wola district, which has delivered 9,000 sqm of office space and 1,000 sqm of retail areas.

Karolina Kowalska

Property-related stocks Security

Closing price on Dec 20

% change (week)

52-week low

52-week high

% change (year)

Total shares

Market value (z∏. mln)

BUDIMEX

71.50

2.58

45.85

88.35

-0.42

25,530,098

1,825.40

CELTIC

4.50

12.78

3.74

19.38

-73.53

34,231,466

154.04

DOMDEV

34.00

4.84

23.51

42.80

18.51

24,715,272

840.32

ECHO

5.18

-1.15

3.17

5.48

66.03

420,000,000

2,175.60

ELBUDOWA

105.00

-5.58

88.80

120.00

17.98

4,747,608

498.50

ENERGOPLD

0.26

-13.33

0.17

2.30

-85.95

70,972,001

18.45

ERBUD

15.97

0.76

11.33

23.20

9.01

12,677,956

202.47

GANT

3.68

-19.47

2.68

9.85

-38.15

20,120,000

74.04

GTC

9.58

2.02

5.20

11.40

9.49

319,372,990

3,059.59

HBPOLSKA

0.02

0.00

0.01

1.43

-97.14

210,558,445

4.21

JWCONSTR

3.98

-0.50

3.26

8.40

-20.40

54,073,280

215.21

LCCORP

1.15

-5.74

0.86

1.48

33.72

447,558,311

514.69

MARVIPOL

8.60

-3.91

6.20

11.00

-4.34

36,923,400

317.54

MIRBUD

1.12

-6.67

0.98

2.68

-44.00

75,000,000

84.00

MOSTALWAR

12.10

3.86

11.30

22.21

-26.67

20,000,000

242.00

MOSTALZAB

1.09

-2.68

0.81

1.80

-12.10

149,130,538

162.55

ORCOGROUP

10.03

-3.56

6.36

19.55

-30.83

107,840,962

1,081.64

PBG

5.20

-19.00

3.36

83.90

-91.92

14,295,000

74.33

PLAZACNTR

1.36

-3.55

1.36

2.94

-31.31

297,181,703

404.17

POLAQUA

3.49

-1.69

3.20

8.18

-29.49

27,500,100

95.98

POLIMEXMS

0.62

3.33

0.48

2.04

-57.82

521,154,076

323.12

POLNORD

10.30

-1.34

10.00

19.85

-18.64

25,633,027

264.02

RANKPROGR

10.60

4.23

7.10

16.97

21.14

37,183,550

394.15

ROBYG

1.47

0.00

1.08

1.75

31.25

257,935,500

379.17

RONSON

0.80

-3.61

0.61

1.15

-4.76

272,360,000

217.89

TRAKCJA

0.56

-13.85

0.56

1.44

-33.33

232,105,480

129.98

ULMA

42.40

4.67

37.20

74.80

-31.61

5,255,632

222.84

UNIBEP

4.98

2.05

3.60

6.28

-4.96

34,021,684

169.43

WARIMPEX

3.67

-0.81

2.64

4.62

4.56

54,000,000

198.18

ZUE

5.97

-4.94

5.07

8.50

-10.23

22,000,000

131.34

www.wbj.pl

25

26

www.wbj.pl

LOKALE IMMOBILIA – REAL ESTATE

DEC 24, 2012 – JAN 13, 2013

A new Lublin Krzysztof ˚uk, the Mayor of Lublin, discusses how his city plans to attract investors and what makes it special In line with your new strategy, by 2020 Lublin is to be perceived as an open, entrepreneurial and academic city, the metropolitan center of Eastern Poland. How do you want to achieve this?

Krzysztof ˚uk: Human resources are the common denominator for the planned activities. This is why the success of the implementation of the “Lublin 2020” strategy ultimately lies with the residents. It is their intellectual potential that constitutes the strongest asset and driving force behind the city.

Over 20 percent of Lublin’s residents have a degree, while over 83,000 students are currently enrolled at our universities.

Each year, about 25,000 young people graduate from an institution of higher learning in Lublin. Such extensive human capital offers future investors limitless possibilities in terms of finding personnel adequate for their business. Without a doubt, Lublin – a city of young, well-educated and ambitious people – can count on a lot of creative solutions.

Which sectors have been indicated in the strategy as a priority for the city?

An important sector for the development of Lublin’s economy is the shared service center sector. Lublin has the potential to become an outsourcing service center in the areas of finance and accounting, health care and law.

One example of a firm exploiting such services in our city is Genpact, an Indian firm, which has conducted its finance and accounting

activities here since 2008.

Other priorities for Lublin are the IT and biotechnology industries, both in terms of attracting new investors and stimulating the enterprises already operating in the city.

Lublin has a tradition of machine-building and automotive industries, which are currently being rebuilt. We would like the economic development of the city to be based on efficient use of the potential of the sectors we select.

What investment opportunities does Lublin offer?

An important element of Lublin’s investment offer is the land within the Lublin Subzone, which functions as a part of the Euro-Park Mielec Special Economic Zone. Today, the zone’s area covers over 116 ha of land, of which approximately half has already been developed for investments.

The subzone has a very attractive location since the land lies near the interchange connecting the S17 expressway with the city’s beltway, only 6 km from the airport and 2 km from a railway siding.

A part of the free area, approximately 25 ha, is fully fitted with utilities. The remaining part, a total area of 37 ha, is currently being prepared for investments and shall be fully fitted with utilities by mid-2013. I encourage interested parties to contact our Strategy and Investor Assistance Department which shall prepare a customized offer for entrepreneurs interested in our city.

What actions are being undertaken to show the attractiveness of the city?

Currently, Lublin’s priority is to develop our transport infrastructure.

The funding of infrastructure investments is decisive for Lublin’s development. It allows companies to locate their business here and consequently has an impact on the creation of new jobs. In 2011, we devoted z∏.310 million to infrastructure projects, in 2012 – z∏.450 million. We plan to allocate z∏.667 million for infrastructure projects next year. We successfully obtained z∏.1.3 billion from the European Union as well as support from government programs to the amount of z∏.1.5 billion to spend on upgrading our infrastructure in the next few years.

Thanks to the city’s involvement, the Lublin Airport was recently opened. In mid-December, we witnessed the takeoff of the first planes to London, Oslo and Dublin, while in the summer of 2013 flights to Liverpool are scheduled to start.

Intensive works are also being carried out on the construction of the city’s beltway, its access roads and subsequent sections of the S17 expressway. It is one of the biggest and most urgent road investments currently underway in our region.

The route surrounding the city from north and east will be built along the planned S12, S17 and S19 expressways and it will be accessed only through interchanges. Preparatory works for modernization of the Lublin-Warsaw railway link will soon commence. The investments in transportation infrastructure will dramatically change Lublin’s position on the map of Poland and Europe.

What can convince a potential investor to do business in Lublin?

One of the greatest competitive advan-

BROUGHT TO YOU BY THE CITY OF LUBLIN

tages of Lublin is its human capital and strong student community. In order to use the potential of young people, we cooperate with universities to start new future-oriented courses. We want our graduates to be employed by companies and corporations here in Lublin. This approach has brought results. Over the last two years, over 700 jobs have been created, mostly in the IT industry and accounting services, but also in the production sectors.

The attractiveness of Lublin is also determined by its rich cultural offer.

Lublin is the cultural center of Eastern Poland. We organize many cultural events: the Art-Masters Carnival, Culture Night, Different Sounds Art’n’Music Festival and the Jagiellonian Fair among many others. These are truly artistic gems which give the city a unique atmosphere.

In order to exploit the artistic potential to the maximum, we are improving the infrastructure in this scope. Recently, with the financial support of the Ministry of Culture, we carried out renovation works of such historic buildings as the Old Theater or Cultural Center.

The ministry also granted z∏.20 million for the modernization of the Musical Theater and the Lublin Concert Hall – institutions located at the building of the Center for the Meeting of Cultures, currently under construction. Its inauguration is planned for 2015. I am convinced that all these factors speak not only for Lublin’s creativity and entrepreneurship, but also for the potential to do business here. ●

28

MARKETS

www.wbj.pl

DECEMBER 24, 2012 – JANUARY 13, 2013

Stocks report

world stock indices DJIA

NASDAQ

13,311.72 (Dec 20 close)

S&P500

3,050.39 (Dec 20 close)

1.07% (for the week)

FTSE100

1,443.69 (Dec 20 close)

1.95% (for the week)

DAX

5,958.30 (Dec 20 close)

1.71% (for the week)

0.48% (for the week)

Fiscal cliff spoils moods

NIKKEI 7,672.10 (Dec 20 close)

10,039.33 (Dec 20 close)

1.19% (for the week)

3.04% (for the week)

CHANGE: 7.38%

CHANGE: 15.16%

CHANGE: 13.05%

CHANGE: 4.53%

CHANGE: 26.28%

CHANGE: 17.28%

(year to Dec 20)

(year to Dec 20)

(year to Dec 20)

(year to Dec 20)

(year to Dec 20)

(year to Dec 20)

52-week high: 13,661.90

52-week high: 3,196.93

52-week high: 1,474.51

52-week high: 5,989.10

52-week high: 7,672.10

52-week high: 10,255.20

52-week low: 11,735.20

52-week low: 2,518.01

52-week low: 1,202.37

52-week low: 5,229.80

52-week low: 5,637.53

52-week low: 8,238.96

Investors started the last trading week before Christmas in positive territory as news emerged of a possible deal on the fiscal cliff in the US. The WIG20 gained 0.6 percent on Monday, December 17, while the WIG finished 0.4 percent up. PGNiG was among the best performers, finishing with its share price 2.7 percent higher.

Tuesday saw continued gains on the WSE. The WIG20 ended the day 0.05 percent up while the mWIG40 finished 0.36 percent higher. KGHM and PKN Orlen’s shares were the big gainers that day.

On Wednesday, the WSE was one of the best performers in Europe, as the WIG gained 0.98 percent on the session’s trading. Investors were optimistic on news that S&P had raised Greece’s credit rating.

Thursday, though, started badly for the WSE. The lack of a deal on the fiscal cliff in the

Major indices WIG

47,701.82 (December 20 close)

WIG20

2,593.73 (December 20 close)

Change for the week: 2.25%

52-week high: 47,701.82

Change for the week: 2.97%

52-week high: 2,593.73

Change year to December 20: 24.49%

52-week low: 36,653.28

Change year to December 20: 18.21%

52-week low: 2,035.80

49,000

2,700

47,200

2,620

45,400

2,540

43,600

2,460

41,800

20.12

19.12

18.12

17.12

14.12

13.12

12.12

11.12

10.12

07.12

06.12

05.12

04.12

03.12

30.11

29.11

28.11

27.11

26.11

23.11

2,300

20.12

19.12

18.12

17.12

14.12

13.12

12.12

11.12

10.12

07.12

06.12

05.12

04.12

03.12

30.11

29.11

28.11

27.11

23.11

26.11

2,380

40,000

Top 5 REGNON KBDOM RESBUD K2INTERNT NFIEMF

Closing 0.04 0.17 6.31 15.45 16.20

% change (week) 52-week high 33.33 0.18 30.77 0.23 21.11 6.45 18.85 24.80 15.71 16.40

52-week low 0.03 0.01 5.95 10.41 7.60

Top 5 PKNORLEN PGNIG BRS BOGDANKA ASSECOPOL

Closing 52.20 5.17 0.56 140.40 45.81

% change (week) 6.99 6.60 5.66 5.56 5.31

52-week high 53.70 5.25 0.89 142.40 55.45

52-week low 31.44 3.61 0.48 103.80 38.80

Bottom 5 EUROMARK RUBICON ATLANTAPL GREENECO ONE2ONE

Closing 0.06 0.22 3.00 1.98 0.15

% change (week) -33.88 -31.25 -27.36 -23.26 -21.05

52-week low 0.06 0.21 3.00 0.56 0.15

Bottom 5 SYNTHOS TVN BHW KERNEL KGHM

Closing 5.36 9.81 99.00 68.50 190.60

% change (week) -3.42 -1.70 -1.00 -0.72 0.85

52-week high 6.78 12.40 102.10 76.00 194.80

52-week low 4.16 5.90 65.35 51.00 106.20

52-week high 2.39 0.68 13.80 3.56 3.46

sWIG80

The z∏oty rally continues

10,242.71 (December 20 close)

WIG-Banki

6,669.59 (December

20 close)

20.12

19.12

18.12

17.12

14.12

13.12

12.12

11.12

10.12

07.12

06.12

05.12

20.12

19.12

18.12

17.12

14.12

13.12

12.12

11.12

10.12

07.12

6,100

06.12

32.0

05.12

6,220 04.12

32.4

03.12

6,340

30.11

32.8

29.11

6,460

28.11

33.2

27.11

6,580

26.11

33.6

23.11

6,700

04.12

52-week low: 5,163.30

03.12

Change year to December 20: 20.32%

30.11

52-week low: 32.54

29.11

Change year to December 20: -21.57%

28.11

52-week high: 6,669.59

27.11

Change for the week: 2.73%

26.11

52-week high: 43.83

23.11

Change for the week: -1.18%

34.0

Adam Narczewski X-Trade Brokers DM SA

20.12

19.12

18.12

17.12

14.12

13.12

12.12

11.12

52-week low: 8,218.71

05.12

04.12

03.12

30.11

29.11

20.12

19.12

18.12

17.12

14.12

13.12

12.12

32.54 (December 20 close)

52-week high: 10,536.29

SOURCE: WSE

NewConnect

11.12

10.12

07.12

9,800

06.12

2,400

05.12

9,920 04.12

2,460

03.12

10,040

30.11

2,520

29.11

10,160

28.11

10,280

2,580

27.11

2,640

26.11

10,400

23.11

2,700

28.11

Change year to December 13: 19.04%

27.11

52-week low: 2,076.52

26.11

Change year to December 20: 19.05%

23.11

Change for the week: -0.57%

10.12

20 close)

52-week high: 2,607.46

07.12

2,607.46 (December

06.12

mWIG40

Remi Adekoya

Currency report

Other indices Change for the week: 0.96%

US soured moods and European indexes kicked off in the red.

However, positive macroeconomic data from the US, showing that the world’s largest economy grew 3.1 and not 2.7 percent in Q3 as previously estimated, improved moods slightly later in the day. But the WIG20 still ended 0.34 percent down while the WIG lost 0.46 percent. PKN Orlen ended the session 1.42 percent down while PZU lost 2.13 percent on its share price.

The last session before Christmas ended in the red.

Information that politicians in the US were now very far from a deal on the fiscal cliff caused concern. In the end, the WIG20 finished the day 0.41 percent lower while the WIG was down 0.47 percent. The mWIG40 did even worse, losing 1.56 percent of its value on the day.

This December we are truly experiencing the Santa Claus rally. Stock indices all around the world are reaching yearly highs. Investors believe the Greek problem is partially solved while Democrats and Republicans seemed close to reaching a deal on the fiscal cliff. Improved global sentiment pushed the EUR/USD to the highest levels since April of this year. The main currency pair rallied to reach $1.33 and then retreated to $1.32 by the end of the week.

The z∏oty also took advantage of decreased risk aversion despite negative macroeconomic news from the local economy. Wages increased by 2.7 percent on an annual basis, which is lower than inflation. Industrial production really disappointed, declining 0.8 percent y/y in November (taking into

account seasonal factors, the decline was even bigger).

Consumer price inflation increased by just 1.7 percent, but the worrisome news came on Friday – retail sales increased only by 2.4 percent y/y while the unemployment rate climbed to 12.9 percent.

All these are signs that next year is going to be tough for the economy.

Poland’s interest-rate setting Monetary Policy Council should continue the process of cutting interest rates, but to have a chance for GDP growth, this time the cuts need to be more drastic (at least by 50 basis points at once).

Despite the negative factors, global positive factors influenced the z∏oty, which continued its appreciation. The EUR/PLN finished the week at z∏.4.07 while the USD/PLN declined to z∏.3.08. ●

currency rates 3.6622 21.12

SOURCE: NBP

3.6642

3.6990 18.12

20.12

3.7034 17.12

3.6394

3.7306 14.12

0.1001

0.1001 21.12

3.5

19.12

PLN-100JPY

4.0

20.12

0.1004

0.0999 19.12

18.12

0.1009 17.12

21.12

20.12

19.12

18.12

17.12

0.1016

0.10

14.12

3.3657

3.3716

3.3703

3.3860

3.3847

PLN-RUB

0.12

0.08

14.12

5.0037

5.0016 21.12

3.0

3.3811

PLN-CHF

3.5

20.12

5.0006 19.12

5.0357 18.12

17.12

5.0431 14.12

3.0769

3.0791 21.12

4.9

5.0260

PLN-GBP

5.1

20.12

3.0690 19.12

3.1044 18.12

3.1271

3.1035 17.12

21.12

20.12

19.12

18.12

17.12

14.12

4.0643

4.0715

4.0730

4.0900

4.0912

PLN-USD

3.5

3.0

14.12

4.0

4.0839

PLN-EUR

4.1

SPORTS

DECEMBER 24, 2012 – JANUARY 13, 2013

www.wbj.pl

29

Soccer

Cross-country skiing

Warta Poznaƒ owner asks for financial aid

Kowalczyk back in form Justyna Kowalczyk

SHUTTERSTOCK

In mid-December Warta Poznaƒ owner Izabella ¸ukomska-Py˝alska wrote a letter to city authorities requesting financial assistance for the professional soccer club. In the letter, Ms ¸ukomska-Py˝alska, a former Playboy model, said, “I am no longer able to maintain the finances of the Warta Football Club. Without any help from the City of Poznaƒ, the club will fail.”

The average budget for a club in the I Liga (the second tier of Polish soccer), in which Warta plays, is around z∏.2-2.5 million. “If Warta wants to compete for a spot in Poland’s top league, the Ekstraklasa, the budget would need to be somewhere around z∏.4-5 million, wrote Ms ¸ukomska-Py˝alska.

“The current amount that the club receives from the city is z∏.40,000.”

Later on the same day, Ms ¸ukomska-Py˝alska, an active Twitter user, tweeted the question, “I wonder if this time the city will turn its back on Warta?”

The City of Poznaƒ subse-

COURTESY OF WIKIMEDIA COMMONS

The former Playboy model says without financial assistance, her club won’t survive

Izabella ¸ukomska-Py˝alska quently organized a meeting with Ms ¸ukomska-Py˝alska and the Committee of Sports and Tourism. Local councilors then agreed to allow her to present the financial situation of the club and her vision for its future.

Ms ¸ukomska-Py˝alska is expected to present her case for financial assistance at the next committee meeting, scheduled for January 7, 2013.

However, the city’s 2013 budget has already been voted on, presenting a major hurdle

for Warta to receive any financial aid. The final decision will likely rest with Poznaƒ Mayor Ryszard Grobelny.

Warta, which is currently sitting in 10th place in the I Liga, has seen its profile skyrocket since Ms ¸ukomskaPy˝alska took charge. The club, which has often been in the shadows of cross-city rivals Lech Poznaƒ, has won the Polish championship twice in its history, with its last title coming in 1947.

David Ingham

The Polish skier won in Canada, putting her at the top of the World Cup leader board Poland’s leading cross-country skier, Justyna Kowalczyk, stormed to victory in the 15km skiathlon race in Canmore, Canada, in mid-December. Ms Kowalczyk finished in 42 minutes 51.5 seconds, well ahead of Anne Kylloenen of Finland who took second place, more than 30 seconds behind. Nor-

way’s Vibeke Skofterud finished third.

It was the 29-year-old’s second victory in a matter of days, after she also won the 10km race at the same World Cup meeting. And it was just the tonic the three-time overall World Cup winner needed after a disastrous start to the season.

Ms Kowalczyk, who spent time on the operating table during the summer in a bid to cure a troublesome knee injury, finished the 10km race in Gälli-

vare, on December 3, in 27th place – almost a minute and a half behind last season’s overall champion Marit Bjoergen, who did not participate in the races in Canada.

Ms Kowalczyk, who often starts the season slowly, is now back on track with her two victories in Canada putting her on top of the overall standings with 515 points. Trailing her is American Kikkan Randall. Ms Bjoergen fell to third place.

David Ingham

30

LIFESTYLE

www.wbj.pl

DECEMBER 24, 2012 – JANUARY 13, 2013

Event

Year-end fireworks Many of the biggest names in the Polish pop world will descend on Pl. Konstytucji again this New Year’s Eve for the annual end-of-year party organized by Warsaw City Hall. The event has become a yearly tradition, attracting some of the country’s top names as well as fans from

across Poland, and this year the lineup is once again starstudded for a disco-themed musical extravaganza.

Tracks including “Daddy Cool,” “Boys, boys, boys,” “Billie Jean, “YMCA” and recent worldwide superhit “Gangnam Style” will be performed by the likes of Zakopower, Kasia Kowalska and Maciej Maleƒczuk, among many others.

Warsaw Mayor Hanna

Gronkiewicz-Waltz and other prominent figures will be on hand at the six-hour party, which will include a fireworks display, various big screens and ample opportunity for refreshments. For those unable to attend, the whole evening will also be beamed live on Polish TV network Polsat.

COURTESY OF FACEBOOK.COM/DRESSEDFORSPACE

New Year’s Eve event December 31, 8 pm Pl. Konstytucji Warsaw

David Ingham

For more information, log on to sylwester-2012.eu

New Year’s fireworks display

Trust

Concert

In music we trust COURTESY OF UM.WARSZAWA.PL

Trust January 10 1500m2, ul. Solec 18 Warsaw This synth-pop duo consists of vocalist Robert Alfons and producer Maya Postepski, who describe their music as the “dark fumes of desire, erotomania, speed and tears.” For fans of electroNew Wave, Gothic sounds and acclaimed groups such as Crystal Castles and Austra, this January gig by Canadian

group Trust is a must-see show.

The duo first came to prominence in 2011 with its debut EP “Candy Walls,” with their first long-play album “TRST” coming out in February 2012.

Their best-known single to date is “Sulk” which perfectly showcases their early-80s dance sound. Other standout tracks include “Candy Walls” which has the same dark electronic feel as some of

Depeche Mode’s early work.

The industrial layout of cavernous venue 1500m2 should fit perfectly with the musical style of the group to create an unforgettable night for those in attendance. Tickets for the concert are priced from z∏.30 and are available direct from the venue or online.

David Ingham

For more information, log on to 1500m2.com

Museums, galleries and venues in Warsaw Centre for Contemporary Art at Ujazdowski Castle ul. Jazdów 2 www.csw.art.pl Czarna Gallery ul. Marsza∏kowska 4 www.czarnagaleria.art.pl

DAILY EXECUTIVE DIGEST Poland A.M. gives you the biggest Polish stories of the day.

Have the most valuable news delivered to your inbox each weekday morning.

Galeria 022, DAP, Lufcik ul. Mazowiecka 11a www.owzpap.pl Galeria 65 ul. Bema 65 www.galeria65.com Galeria Appendix 2 ul. Bia∏ostocka 9 www.appendix2.com Galeria Asymetria ul. Nowogrodzka 18a www.asymetria.eu Galeria Foksal ul. Foksal 1-4 www.galeriafoksal.pl Galeria Milano Rondo Waszyngtona 2A www.milano.arts.pl Galeria Schody ul. Nowy Âwiat 39 www.galeriaschody.pl

S i g n u p f o r a 2 - w e e k f r e e - t r i a l ! w w w. p o l a n d a m . p l G e r m a n v e r s i o n : w w w. p o l e n a m m o r g e n . p l

Green Gallery ul. Krzywe Ko∏o 2/4 www.greengallery.pl

Simonis Gallery ul. Burakowska 9 www.simonisgallery.com

Katarzyna Napiórkowska Art Gallery ul. Âwi´tokrzyska 32, ul.

Krakowskie PrzedmieÊcie 42/44 and Old Town Square 19/21 www.napiorkowska.pl

State Archaeological Museum in Warsaw ul. D∏uga 52 www.pma.pl

Królikarnia National Gallery ul. Pu∏awska 113a www.krolikarnia.mnw.art.pl Le Guern Gallery ul. Widok 8, www.leguern.pl Museum of Independence Aleja SolidarnoÊci 62 www.muzeumniepodleglosci.art.pl National Museum in Warsaw Al. Jerozolimskie 3 www.mnw.art.pl Polish National Opera at Teatr Wielki Pl. Teatralny 1 www.teatrwielki.pl Pracownia Galeria ul. Emilii Plater 14 www.pracowniagaleria.pl

State Ethnographic Museum ul. Kredytowa 1 www.ethnomuseum.website.pl Historical Museum of Warsaw Old Town Square 28-42 www.mhw.pl History Meeting House of Warsaw ul. Karowa 20 www.dsh.waw.pl Warsaw Philharmonic ul. Jasna 5 www.filharmonia.pl Warsaw Rising Museum ul. Grzybowska 79 www.1944.pl

Galeria XX1 Al. Jana Paw∏a II 36 www.galeriaxx1.pl

Rempex Art and Auction House ul. Karowa 31 www.rempex.com.pl

Wilanów Palace Museum and Wilanów Poster Museum ul. St Kostki Potockiego 10/16 www.milanow-palac.pl www.postermuseum.pl

Galeria Zoya ul. Kopernika 32 m.8 www.zoya.art.pl

Royal Castle Pl. Zamkowy 4 www.zamek-krolewski.com.pl

Zachęta National Art Gallery Pl. Ma∏achowskiego 3 www.zacheta.art.pl

LAST WORD

DECEMBER 24, 2012 – JANUARY 13, 2013

www.wbj.pl

31

Tech Eye

Winter is coming.

We’re not talking about the rosycheeked winter of Christmas cards or Norman Rockwell paintings. Not the “Game of Thrones,” frost-zombiepocalypse kind either.

We’re talking about January-in-Poland winter. Real winter, when the urban landscape is transformed into an icy tundra upon which arctic wolves stalk the ill and infirm. When slathering your face with half-congealed goat fat is the only way to avoid frostbite and the dull glimmer of snotsicles is about the cheeriest thing you’ll see in the grim half-light of noon.

When unfortunate pedestrians become trapped in snow drifts and enter a state of hypothermic hibernation until they emerge, bewildered and ravenous, in the spring thaw.

That’s the kind of winter Techeye is talking about. It’s on its way. Are you and your gadgets prepared for it?

The hi-Call Bluetooth Gloves The gadget is recommended for kids aged six-plus and costs around $20, though we’ve seen it on Amazon for as low as $7.29.

deranged. Which isn’t necessarily a bad thing.

Purchasing a pair of hi-Call gloves will set you back a not-inconsiderable €50, and they only come in black or gray.

Finally, we come to the Force Glove from science-toy maker Uncle Milton (Unclemilton.com). You’d be forgiven for thinking this a poor anti-winter solution, particularly since there’s only one glove.

But you have to remember, it’s a Force Glove. If the Force can be used to casually asphyxiate grown men in a non-autoerotic manner, then it can probably treat winter like a step-child.

Ok, that might be a slight exaggeration. The Force Glove can’t be used to magically defeat winter. But it can be used to teach kids a bit about magnetism.

Here’s is how it works: first, insert a magnet into the glove. And second ... oh wait, that’s it.

COURTESY OF E-VOLVE

The E-volve Touch-Gloves

COURTESY OF HI-FUN

Preparing for the glacial days ahead

If the answer is “yes,” then godspeed to you, Gentleperson. Have a lovely winter. And if the answer is “no,” worry not.

We’ve got some ideas on how to winterize you. Your hands, anyway.

The fog of wear

The Force Glove The Force Glove can attract or repel depending on which side of the magnet is facing outwards. It comes with two targets and a “fun and informative learning guide,” though there’s a strong possibility the guide is neither fun nor informative.

To advertise in WBJ’s classifieds section, contact Agnieszka Brejwo, at (+48) 222-577-526 or abrejwo@wbj.pl COURTESY OF ANOUK WIPPRECHT

Let’s start with the E-volve Touch-Gloves.

To be honest, these aren’t the techiest gloves on the market. But they’ll keep your paws warm and they’re relatively inexpensive – just $9 on Amazon, last we checked.

The gloves’ main selling feature is the presence of “capacitive tips” for the thumb, index and middle fingers, which let you to use a touchscreen device without freezing your digits off. Also, gloves with capacitive tips are much less prone to leakage than those with reservoir tips.

That’s important, in our experience.

The fact that the gloves come in pink (as well as black) is sassy. Still, we’re not convinced by the “one-size fits all” approach taken by E-volve and it’s a damned shame they don’t come in leather. Those looking to re-enact a “This is Spinal Tap” glove-smelling scene will be disappointed – these aren’t the gloves for you.

If the lack of leather isn’t a problem for you but the lack of functionality is, check out the hi-Call Bluetooth Gloves from hiFun (hi-Fun.com). These too have capacitive tips, though only on the index finger and thumb; the middle finger has been given the finger, capacitively speaking.

Anyway, the cool part is that there’s a microphone and speaker integrated in the little finger and thumb, respectively. In other words, you can literally “talk to the hand,” though passersby will think you

COURTESY OF UNCLE MILTON

Smell the gloves

Wearing the last item on this week’s agenda in the dead of winter might be a bad idea. Step out into the January air, clad only in the Smokedress by Dutch designer Anouk Wipprecht (Anoukwipprecht.nl), and you’re practically guaranteed to develop freezer burn on your sensitive bits.

But the Smokedress is a symbol, like the first blades of grass that emerge, shy and tender, from the soft ground each spring. It’s a promise that winter will pass and days will come again when you can brazenly bare your skin without risking disfigurement.

Also, the Smokedress magnificently incorporates a wireless fog machine from German nebelmeister Look Solutions. The upshot is that its wearer can emit fog from either the chest or the nether region. And really, who among us hasn’t dreamed of being able to discharge a little crotch-fog now and then?

We honestly don’t know what the Smokedress costs – this isn’t a mass-production item – but we figure Ms Wipprecht could be persuaded to part with it for the right price. Or maybe she could be persuaded to make a brand new garment with some extra fabric, one that would be good for cold weather.

Because, as you know, winter is coming. And a winter coat that exuded fog would be ridiculously awesome, as well as useful for avoiding arctic wolves. ●

The Smokedress

Ever re-enacted a scene from “This is Spinal Tap”? Let us know: techeye.wbj@gmail.com