Changes in the special economic zones
In Poland, a law to promote new investments is to enter into force in June 2018. The law is intended to create new framework conditions for companies operating in special economic zones (“SEZ”). The new regulations not only modify the conditions for carrying out commercial activities within the SEZ, but also the conditions for claiming the benefits to be granted.
On the positive side, the SEZ benefits, which until now could only be claimed in limited areas, are now to be granted nationwide. As a result, investors have more commercial space available for expansion. However, site planning can still be limited by provisions of local development plans or by recommendations of the administrator of the respective SEZ zone if, in his opinion, another site is more suitable for a specific project. The benefits for entrepreneurs are granted on the basis of the so-called funding decision. Unlike before, the decision must now indicate the exact location of the project. The principles of body tax exemption, however, remain unchanged. However, the amount of aid granted under EU rules may be reduced by national legislation. Furthermore, some of the criteria according to which entrepreneurs are granted licences for their commercial activities within the SEZ have been amended. The decisive factor now is not only the volume of expenditure, but also certain qualitative requirements.
These factors, as well as the limitation of the validity of the permit to 10 to 15 years, will certainly enable investors to better assess the respective advantages and disadvantages. The design of the regulations in the draft law suggests that investment projects at locations that have so far been less in demand will theoretically be cheaper and easier to implement. In such regions, investors benefit from good availability of space and manpower, which can ultimately have an impact on the success of the project. However, if the entrepreneur wants to implement his project in an already highly developed region (eg in Lower Silesia), this path is also open to him. However, he has to reckon with higher expenses.
Implementation and maintenance of investments
The requirements for the durability of the project remain fundamentally unchanged. Depending on the size of the company, the project must have a duration of three or five years. In view of the current legislative gap, cumulative use of aid on the basis of several authorisations is highly unlikely to be permitted in the future. According to the new legal situation, the investor may only account for the aid granted to him in relation to the investment for which he has received a licence for a commercial activity within the SEZ. Furthermore, the aid can only be used separately once the respective project has been completed. However, investors will have more options in the future to have an existing funding decision amended.
It pays to invest
Although the new procedure for obtaining SEZ authorisation is formally somewhat more complicated, entrepreneurs can count on comprehensive support. Investors can rely on the support of the respective administrators of the special economic zones, who are interested in the development of their territories, as well as advisors specialising in SEZ issues, in order to ensure successful settlement.
Author: Kinga Słomka