So much has changed overnight in terms of the rules of doing business across the English Channel. We have tried to pull together an overview of some of these changes in this issue of Contact Magazine Online – it’s worth looking over the contents (below) to see which of them have a direct impact on your firm, and indeed, your life. Our members, particularly in the advisory, real estate and recruitment sectors, have noted an increase in enquiries from UK-based firms looking to relocate all or some of their EU business to Poland, but this is matched with enquiries from the US, Scandinavia and Western Europe, as well a new direction – from Asia. So there are new business opportunities, as well as problems.
Nick Lakin, group corporate affairs director at Kingfisher plc, parent company of Poland’s most successful home-improvement retailer, Castorama, talks about the factors behind that success. With Tesco selling its Polish operations to a Danish retailer, Kingfisher is now the UK’s biggest investor in Poland, in terms of capital and number of people employed.
Magdalena Szczepańska from Bank Pekao S.A. discusses the prospects for new inward investment into Poland in the wake of Brexit and Covid, and future trends that can be expected to affect the Polish economy as the world begins to recover from the effects of the pandemic.
At a time when major foreign investment decisions are being made in the wake of global changes, Agnieszka Janicka and Krzysztof Hajdamowicz from Clifford Chance, assess Poland’s perception as a place to do business and the factors that underlie those perceptions.
Brexit has created many of new regulations and requirements which impede the hitherto smooth flow of goods between Poland and the UK. Taxes and customs duties are among the biggest headaches. To explain the main changes in this area, and how to ensure they do not harm your business, Katarzyna Adamowicz, head of tax, KR Group, presents a useful overview.
Another major area of difficulty for business concerns Rules of Origin. Without a certificate stating that goods exported to the UK were made in the EU – or that goods imported from the UK were made in the UK – full customs duties must be paid on those goods. Dr Michał Bernat, managing partner, Dentons tax practice in Warsaw, explains how this works.
Transit guarantees – a subject that few British exporters were even aware of – suddenly became a major issue after Brexit. Krzysztof Laskowski, a customs agent from SGS, covers some of the new requirements regarding customs declarations.
Brexit has also created unexpected difficulties which firms may not have been expecting. One example is way that the bankruptcy proceedings between the UK and Poland are conducted. From 1 January 2021, rulings issued by insolvency courts in the UK are no longer automatically recognised in EU member states. Ewa Kruszko, from Wardyński & Partners, outlines the key changes and what to do if a trading partner in the UK defaults.
We also outline the main areas of difficulty that have been raised by business over the first two months after Brexit came to fruition.
So given that doing business between the UK to the EU has become much harder, does it not make sense to relocate to Poland, as a lower-cost base from which to serve EU markets?
Setting up a business in Poland is not the easiest of tasks, so the right choice of entity is critical to success. Branch or representative office? Limited liability company, partnership or joint-stock company? Each has its own pros and cons. Michał Kulczycki and Ewa Guerri from Accreo offer a timely overview of the forms of business entity to choose from when establishing in Poland.
An alternative to setting up an entity from scratch is to acquire a business in Poland. Brexit is creating new opportunities in the field of mergers and acquisitions; Adam Zohry from Mazars Group takes a look at the M&A market in Poland and how acquiring a company here can be a catalyst for post-Brexit growth.
Setting up in Poland is all well and good – but will you find the staff for your business? With near-shoring and near-sourcing becoming established trends driving new inward investment into Poland, how what shape is the labour market, particularly for those high-demand skills like IT? Łukasz Grzeszczyk of Hays presents an overview of HR availability in Poland today.
The Polish real-estate market is showing divergent trends, exacerbated by Covid. The boom in e-commerce is fuelling demand for distribution centres and last-mile logistics space. We have two articles giving an overview of the current situation, from Grzegorz Chmielak, managing partner at Knight Frank, and from CBRE’s Jan Banasikowski, who both observe that Poland is becoming a beneficiary of changing investor sentiment. Meanwhile, a new category of real estate is becoming visible in Poland – data centres. A report from Cushman & Wakefield is summarised here.
Inward investors seeking a base inside the EU should consider a well-located special economic zone, which offers additional advantages over those that one can find anywhere else across Poland. British investors have already moved in to the Łódź Special Economic Zone, says Mateusz Słonecki, its press spokesman.
Moving senior executives from country to country can be time-consuming and costly, and getting it wrong impedes their effectiveness once they’ve hit the ground. Get someone professional to take care of the process, suggests Anna Skałecka, CEO of Exclusive Worldwide.
The legal aspects of UK citizens working in Poland post-Brexit should not be ignored. Tomasz Rogala from law firm PCS Paruch Chruściel Schiffter | Littler Global highlights the new requirements for UK nationals looking to run firms, work and live here – or just to visit on business.
Brexit, however, is not a one-way street. The UK remains an attractive springboard from which Polish tech firms can go global. Adrian Synoradzki, from Hare Street Consulting, outlines Poland’s MedTech sector, spotlighting some Polish champions, and explains how the sector could benefit from UK know-how and capital.
With EU students no longer charged the same tuition fees as home students in the UK, access to what is still one of the world’s best tertiary education systems will become vastly more expensive to talented young Poles wanting to study in Britain from October onwards. But there is a solution – Coventry University has set up a campus in Wrocław, and will be offering UK-quality education to Poles for tuition fees that are one-third of those now facing Polish student wanting to study there.
A Polish sector that has been massively hit by Covid-19, and to a lesser extent by Brexit, is air travel. Natalia Vince from Kraków Airport sets out its ambitious plans to expand in readiness for the end of pandemic restrictions, so it can function as a gateway to Kraków and the Małopolska region – and be prepared for the 2023 European Games, which Kraków is hosting.
How will Covid-19 affect the way business reaches customers in Poland? Kazimierz Piekarz from Binaria Upgrade Marketing surveys the changes, driven by new technologies, which are displacing traditional advertising, and the specifics of the Polish consumer.
Finally, help is at hand for businesses who are finding that rates of return on bank term deposits are disappointing to say the least (and will remain so for the foreseeable future), there is an alternative. Aviva Investors Poland has set up a Stable Income Fund aimed at businesses who are looking for a safe, steady income stream generated by their financial surpluses, incurring the minimum of management fees.
As always, there’s plenty of useful insights to be gathered from BPCC members writing for Contact Magazine Online – please bookmark relevant pages and return to them when you can if you can’t read them all now. The next issue of Contact Magazine Online will appear in early May and will focus on green transformation. Members who wish to contribute should keep an eye on BPCC communications – we’ll be letting you know what’s needed very shortly!