Polish Construction Law unconstitunal.

Amendment of the Polish Construction Law of April 2009 will go into the trash. Polish Constitutional Tribunal announed unconstitutional to repeal the requirement to obtain a building permit. According to the Court it drastically affect the ownership of the neighboring properties. They could not appeal to the authority of higher courts and administrative courts. Inconsistent with the Constitution is also the legalization of illegal building, since breaks the principle of equality before the law .
Rulling Kp 7/09

Buy a property in Poland

Property purchase in Poland

Purchase of a property in Poland requires a due diligence process. It should be carried out preferably by a lawyer (adwokat) not a property agent. Generally Property Agent does not provide appropriate level of safety for they buyer as they are interested in gain and moreover they might not be aware of some important legal issues. Therefore it is generally suggested to commission a due diligence process to a independent lawyer who will be able to exclude all possible dangers before the purchase takes place.

Role of a Notary Public in Poland

Many buyers believe the fact that if the property purchase is carried out by Polish Notary Public it guaranties exclusive safety of the transaction. This belief might be very misleading, particularly with respect of Polish Legal System. Everybody who wants to buy a real estate in Poland should note that a Notary Public does not carry out his own due diligence process and does not verify whether the property is free of any encumbrances. Polish Notary Public is made to base upon the documents and statements of the parties. If the documents or statements are incomplete or false the buyer risks a great problem in the future.

The due diligence process before purchase of a property in Poland

The due diligence process should be carried out by a qualified lawyer (adwokat) as mentioned above. Primarily the property book should be inspected in the Land and Mortgage Registry of Poland in order to identify the property and exclude basic encumbrances. Secondly the Inland Revenue Registry should be carefully reviewed for the sake of excluding state mortgages and other obligations. If the buyer intends to construct something on the property the due diligence process must include a verification of the local spatial development plan.
A proper due diligence process requires verification of many important elements, however they may distinct greatly in respect of different kind of properties.

Purchase of a property in Poland by a foreigner

Purchasing property by foreigners is governed by the provisions of the Act on Purchase of Real Estate by Foreigners. The Act establishes as a general requirement of a permit to buy real estate by a foreigner. This also includes a purchase or taking up of shares in a commercial company which has a registered place of business in Poland.

EU nationals

EU nationals and entrepreneurs are exempted from the obligation of obtaining a permit. However they still must obtain a permit in case of purchase of agricultural and forest land - until 2 May 2016.

Permits

Permits are issued by the Minister of Internal Affairs and Administration. 

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Exhaustion of the rights conferred by a Community trade mark

Exhaustion of the rights conferred by Community trade mark is regulated by CTR which states that:   

  

Exhaustion of the rights conferred by a Community trade mark

1. A Community trade mark shall not entitle the proprietor to prohibit its use in relation to goods which have been put on the market in the Community under that trade mark by the proprietor or with his consent.

2. Paragraph 1 shall not apply where there exist legitimate reasons for the proprietor to oppose further commercialization of the goods, especially where the condition of the goods is changed or impaired after they have been put on the market

.

The expression ‘put on the market’ in the CTR has been introduced into the Regulation as result of Article 7(1) of the Directive[1], it constitutes a decisive factor in the extinction of the exclusive right of the proprietor of the trade mark laid down in Article 5 of that directive (see Case C-244/00 Van Doren + Q [2003] ECR I-3051, paragraph 34).

Following the judgment of the ECJ in the case of Peak Holding C-16/03 it is established that the phrase must be given a uniform interpretation in the Community legal order (see, by analogy, Zino Davidoff and Levi Strauss, paragraphs 41 to 43).

The wording alone of Article 7(1) of the Directive does not make it possible to determine whether goods imported into the EEA or offered for sale in the EEA by the proprietor of the trade mark are to be regarded as having been ‘put on the market’ in the EEA within the meaning of that provision. The interpretation of the provision in question must therefore be sought with regard to the scheme and objectives of the Directive. Article 5 of the Directive confers on the trademark proprietor exclusive rights which entitle him inter alia to prevent any third party from importing goods bearing the mark, offering the goods, or putting them on the market or stocking them for these purposes. Article 7(1) contains an exception to that rule, in that it provides that the trade mark proprietor’s rights are exhausted where the goods have been put on the market in the EEA by him or with his consent (see Zino Davidoff and Levi Strauss, paragraph 40, and Van Doren + Q, paragraph 33). The same provision appears in article 13 par. 1 CTR.

The Directive is intended in particular to ensure that the proprietor has the exclusive right to use the trademark for the purpose of putting the goods bearing it on the market for the first time (see, inter alia, Joined Cases C-427/93, C-429/93 and C-436/93 Bristol –Myers Squibb and Others [1996] ECR I-3457, paragraphs 31, 40 and 44). Nor the Directive neither CTR intend to expand the right for subsequent transactions.

It is out of a question that the CTR and the Directive are intended to make possible the further marketing of an individual item of a product bearing a trade mark without the proprietor of the trade mark being able to oppose that (see Case C-63/97 BMW [1999] ECR I-905, paragraph 57, and Sebago and Maison Dubois, paragraph 20).

In the case of Peak Holding C-16/03  Axolin-Elinor, the Swedish Government and the Commission submitted an opinion stating that a failure to comply with a prohibition on resale corresponds to a breach of contract, not an infringement of intellectual property rights. The legal effect of exhaustion as regards third parties is thus not left at the disposal of the contracting parties, whatever effects the agreement is supposed to have as regards the obligations. Any other interpretation would be contrary to the purpose of Article 7(1) of the Directive.

In the above mentioned ruling the Court concluded that exhaustion occurs solely by virtue of the putting on the market in the EEA by the proprietor. Any stipulation, in the act of sale effecting the first putting on the market in the EEA, of territorial restrictions on the right to resell the goods concerns only the relations between the parties to that act. It cannot preclude the exhaustion provided for by the Directive and CTR.

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[1] First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks Official Journal L 040 , 11/02/1989 P. 0001 – 0007, subsequently amended

Lawyers in Poland - our article on HG.ORG

HG.ORG has published our article on Lawyers and Law Firms in Poland. The article was written by our associate lawyer Michael Dudkowiak. The article focuses on the differences between Polish barrister, attorney "adwokat" and Polish legal counsel "radca prawny". The publication should be a guide for private individuals and corporations looking for a legal assistance in Poland.

VAT invoices in an electronic version in Poland since 1 January 2011.

On 1 January 2011 the Decree of the Minister of Finance entered into force. The Decree is amending the regulation on the tax refund to certain taxpayers and new methods of invoicing.
The Regulation lays down detailed rules for the issuing invoices in electronic form.
The changes are intended to mitigate the rigors of the issue.

Polish Tax on Cypriot dividends may change in future

According to Polish Ministry of Finance, persons receiving dividends from the companies in Cyprus should pay in Poland 19 percent of income tax instead of 9 percent.

As a result the Polish government wants to renegotiate the agreement on avoidance of double taxation with Cyprus.

However, in response, tax experts indicate that : dividends received from the Cypriot companies in which the wealthy Poles have an interest, may never get to Poland and then the treasury would not not get a dime.

Ministry of Finance has confirmed that on 10 November 2010, the Prime Minister Donald Tusk has given a permission to start renegotiation of a Protocol to the Agreement with Cyprus. MF has already taken steps to begin negotiations with the Cypriot side.

"The Polish side will seek to adapt the Polish-Cypriot agreement to the current policies of the Ministry of Finance. This policy includes adaptation of the treaties to OECD standards (inter alia conclusion clause on complete exchange of information based on section 26 OECD Model Convention) and to eliminate provisions that lead to double non-taxation of income category (tax sparing clause) "- MF has responded enigmatically to the query of Polish Daily “Rzeczpospolita”.

The mechanism against which the government wants to fight is very simple. Just put the money into a company in Cyprus (create a limited liability company and take up it shares), then the income tax imposed on dividend would  in an amount of  9 percent instead of 19 percent.  That is because the agreement on avoidance of double taxation guarantees 10-percent deduction.

There would be nothing strange, if not the fact that in Cyprus, this tax is not paid, but it is deductable in Poland. By changing the treaty, Polish government want to get the full amount of tax.

The question is whether the goal of MF can be achieved. The Cypriot companies are rather used by wealthier Poles. We can expect that after a possible change in the treaty, the dividends instead of going back to Poland will stay in Cypriot companies.

MF says, at the moment are no concrete solutions, nor the dates of entry into force of any changes, they will be determined during negotiations. According to experts, the possible date is 2012, and maybe even 2013.

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