On 23 June 2020, the Act on subsidization of interest on bank loans granted to entities affected by COVID-19 and simplified arrangement approval proceedings due to COVID-19, commonly referred to as Anti-Crisis Shield 4.0 was published in the Polish Journal of Laws.
The Act primarily lays down the rules of subsidization of interest on bank loans granted to companies affected by the COVID-19 pandemic.
The subsidies will apply to revolving and non-revolving working capital loans granted in PLN.
Subsidized loans may be applied for by entities:
Importantly, the subsidy shall be granted only if the company is not in arrears with the repayment of the loan principal and interest due to the bank, which is the difference between interest accrued at the interest rate charged and the amount of the subsidy.
The subsidy shall cover:
The subsidies will constitute State aid to remedy a serious disturbance in the economy of a Member State, as stipulated by Article 107(3)(b) of the Treaty on the Functioning of the European Union.
Furthermore, the subsidy shall not be recognized as the entity's revenue.
What is more, the Act puts forward a model of simplified restructuring procedures.
Companies willing to rebuild their financial stability will be granted a possibility to independently launch recovery proceedings without the need to apply to the court in this regard. This will be possible through an announcement in the Court and Commercial Gazette (Monitor Sądowy i Gospodarczy) and with assistance of a restructuring advisor.
The launch of restructuring proceedings by the company will suspend the enforcement of creditors' obligations for a maximum of four months and for the time the court approves the arrangements made with creditors. During this period, it will be impossible for the creditors to terminate contracts material to the company's business, including real estate lease or rental agreements. The debtor must enter into a settlement with the creditors within the set deadline.
Once it falls, submission of an application for approval of the arrangement will be required.
If, at the time of deadline, the company still has not made an arrangement with the creditors, it will no longer be protected.
The simplified restructuring procedures can be applied only once.
The introduced provisions are temporary and shall apply until 30 June 2021.
Importantly, the Act brings amendments to the Act on the Control of Certain Investments, by introducing measures preventing hostile takeovers of Polish companies.
Pursuant to the Act, potential investors with citizenship or registered office in a non-OECD country (formerly: outside EU/EEA) will be required to notify the Polish Office of Competition and Consumer Protection of their intent to purchase a given company (or shares in it).
Failure to do so will result in a penalty of up to PLN 10 million.
The safeguard provisions shall extend to public limited companies, companies which are in control of critical infrastructure, companies dealing with software for water supply management, power plant control or operating hospital IT systems as well as entities involved in generation of electricity, production of gasoline and diesel fuels and many other businesses, whose revenues from sales or services in the territory of Poland in any of the two financial years preceding the notification exceeded EUR 10 million.
The decision on whether a given takeover was hostile will be made by the President of the Office, who will have three months to issue the decision authorizing the transaction.
The new solutions are to stay valid for 2 years.
Additionally, the Act provides for some advantageous changes in the rules of subsidization of salaries by the Guaranteed Employee Benefits Fund (GEBF). Under the new provisions, companies may apply for the subsidy even when they do not experience economic downtime or reduced working time. A broad review of the salary subsidy-related changes was presented in the Tax Alert of 27 May 2020.
Please note that the Act brings about a whole range of new significant measures, including:
The Act entered into force on the day following its publication in the Journal of Laws, i.e. on 24 June 2020.
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