Category: Knowledge

In August this year, significant changes to the Labor Code were to enter into force, implementing EU directives on parenthood and transparent working conditions. Due to the delay in legislative work in the Polish parliament, the implementation of these changes has been postponed. As of today, the government plans to enter into force of the new regulations from January 1, 2023. Poland had 3 years to implement these changes – the original implementation date expired at the beginning of August 2022. In upcoming posts, we will present material on the planned changes, compiled partner attorney at law Jakub Stempski.

Contracts for a trial period.

The amendment introduces several modifications to the existing solution, which relate to:

1. the possibility of extending the contract for breaks at work, such as vacation, excused absence,
2. a renewed employment contract for a trial period may be concluded only if its subject is a different type of work,
3. the contract may be concluded for a period depending on the period for which the employer intends to employ the employee next, e.g. if the employer intends to hire the employee for a fixed period of less than 6 months, a trial period contract may be concluded for a month, if the contract is for a period of time specified will be concluded for a period between 6 and 12 months, then a trial period contract may be concluded for a period of two months,
4. a contract for a trial period may be concluded for a maximum of 2 months, as indicated above, while the contract concluded for both one month and two may be extended by a maximum of one month.

The land and mortgage register is an official set of documents maintained by the court competent for the location of the real property. Land and mortgage registers are maintained in order to establish the legal status of real estate. One of the main principles of keeping land and mortgage registers is a presumption, according to which a right disclosed in the land and mortgage register is entered in accordance with the actual legal state. This principle justifies the presumption that: 1) the registered right exists; 2) it belongs to the entity indicated in the entry; 3) the content of the right is consistent with the entry; 4) the right has priority resulting from the entry.

The above presumption is dictated primarily by ensuring security of legal transactions in real estate by ensuring reliability of land and mortgage registers. The land and mortgage register consists of four sections marked with Roman numerals I, II, III, IV. Section I of the land and mortgage register comprises section I-O “Designation of real property” and section I-Sp “Inventory of rights connected with ownership”. Section II discloses the right of ownership and perpetual usufruct. Section III is used to disclose limited rights in rem (except for mortgages), restrictions on the disposal of real property or perpetual usufruct, as well as personal rights and claims against the real property (except for claims concerning mortgages). Section IV records mortgages and claims relating thereto.

In order to ensure security of real estate transactions it is desirable that land and mortgage registers disclose the full legal status of real estate, updated on an ongoing basis as changes occur. It should be emphasised that the presumption of conformity of entries with the actual state extends only to the legal state of the real estate, which is disclosed in sections I-Sp, II, III, IV, but does not extend to entries in section I-O, which contains factual data regarding the designation of the real estate.

In fact, there are situations when an entry in the land and mortgage register is inconsistent with the actual legal state. The inconsistency of the content of the land and mortgage register with the actual legal state may have various forms, and may consist, in particular, in the lack of disclosure of a right, the lack of entry of existing encumbrances or limitations of a right, an incorrect entry of a right, or finally the disclosure of a non-existent encumbrance or limitation. Therefore, it cannot be automatically assumed that every land and mortgage register reflects the current legal state of the real estate.

In the event that the legal status of a real estate disclosed in the land and mortgage register is not consistent with the actual legal status, then the only way to remove the inconsistency is to institute an action for reconciliation of the land and mortgage register with the actual legal status. The legal basis for such an action are the provisions of the Act on Mortgage and Land and Mortgage Registers. A request for reconciliation of the content of the land and mortgage register with the actual legal state is subject to examination by a civil court. Action for removal of discrepancies may be brought if:

1) an existing right is not registered in the land and mortgage register, e.g. a second spouse has not been registered as a co-owner of the real estate, despite the fact that the real estate was purchased during the course of the marriage, one of the partners of a civil partnership has not been registered as a co-owner;

2) the right is registered in the land and mortgage register incorrectly, e.g. incorrect amount of share in co-ownership of the real estate in fractional parts is entered, another spouse is registered as a co-owner of the real estate, despite the fact that the real estate belongs to the personal property of one spouse only; or

3) in the land and mortgage register a non-existing encumbrance or restriction is entered, e.g. mortgage established on the real estate being a joint property of a spouse without the consent of the other spouse is entered, life-tenancy is entered whereas the real estate has been encumbered with life-tenancy servitude of dwelling.

A court judgment in a case for reconciliation of the content of the land and mortgage register does not automatically correct an erroneous entry. Only on the basis of a positive verdict, stating the discrepancy between the legal status of the real estate as disclosed in the land and mortgage register with the actual legal state, the competent land and mortgage register court makes a corrected entry in the land and mortgage register. Therefore, there is a need for cumulative, successive proceedings of both courts, and their joint result is a final reconciliation of the content of the land and mortgage register with the actual legal state.

Reconciliation within the meaning of Article 10 of the Act on Mortgage and Land and Mortgage Registers does not include rectification of real estate designation, e.g. when it appears from the land and mortgage register that the real estate is undeveloped, while in fact it is developed or the wrong area of the real estate is entered in the land and mortgage register. Rectification of faults in entries in Section I-O takes place under a simplified procedure pursuant to the provision of Article 27 of the Act on Mortgage and Land and Mortgage Registers. According to this provision, on the basis of data from the land and building register, at the request of the real estate owner or perpetual usufructuary, the designation of the real estate is rectified in the land and mortgage register.

Rectification of the real estate designation is made in the course of non-court proceedings. The rectification is made by the land and mortgage register court by making an entry. When considering the application to change the designation of the real property in the land and mortgage register, the court ex officio checks the data contained in the application and the designation of the real property disclosed in the land and mortgage register against the data of the real property cadastre (land and building register). As opposed to rectification of an erroneous entry of the legal status of real property, in this case there is no need to obtain a prior court ruling confirming the erroneous entry in the land and mortgage register, as the application for rectification is immediately examined by the land and mortgage register court.

In days the Law of March 9, 2022 on assistance to citizens of Ukraine in connection with the armed conflict on the territory of the country will enter into force. Government is trying to encourage citizens to rent and lend property to citizens of Ukraine.

Thus, new regulations have been introduced, including provisions on lending of real estate.  It is important to note that the characteristic feature of lending is the use only free of charge.

The new regulations apply to lending agreements concluded with:

– Ukrainian citizens who came to the territory of the Republic of Poland directly from the territory of Ukraine in connection with military operations conducted on the territory of that country,

– citizens of Ukraine possessing the Card of the Pole, who came to the territory of the Republic of Poland together with their closest family members because of those military actions,

– spouses of Ukrainian citizens who do not have Ukrainian citizenship, if they came to Poland directly from the territory of Ukraine in connection with military operations carried out in the territory of this country.

 The law provides that:

– in the case of lending/renting to a citizen of Ukraine (or the aforementioned members of their families) of a building or a part thereof for the purpose of temporary satisfaction of housing needs, the provisions of the Act of 21 June 2001 on the protection of tenants’ rights, the housing resource of the municipality and the amendment to the Civil Code (Dz. U. of 2022, item 172) and Art. 15zzu sec. 1 of the Act of March 2, 2020 on special solutions connected with preventing and combating COVID19, other infectious diseases and crisis situations caused by them (Dz. U. of 2021, item 2095, as amended) do not apply in the scope of this lending. This means that if the lending agreement is terminated (e.g. by the expiry of the period for which it was concluded) it is necessary to conduct court eviction proceedings but  after the court proceedings, there will be no restrictions on eviction, such as in particular the right to conclude a social lease agreement.

Granting an entitlement to social housing in a judgment (e.g. to a minor) usually “blocks” an eviction due to the lack of social housing in municipalities.

However, the legislator wants to encourage Polish citizens to lend premises to Ukrainian citizens in need without fear of excessive difficulties in obtaining them.

The legislator excluded the provisions of the so-called “covidova act” (of March 2, 2020, on special solutions related to preventing, counteracting and combating COVID-19, other infectious diseases and crisis situations caused by them), which means that even in the period of epidemic danger and epidemics, it will be possible to carry out evictions.

Importantly, provision has been made for the possibility of granting the benefit to any entity – in particular, a natural person running a household, which will provide accommodation and food to citizens of Ukraine.  The monetary benefit on this account may be granted on the basis of an agreement concluded with the municipality for no longer than 60 days. The period of payment of the benefit may be extended in particularly justified cases. Details are to be determined by the Council of Ministers by decree.

In October this year, legislation came into force which imposes additional obligations on those serving on the boards of housing cooperatives.

On 31 October 2021, an amendment to the Act on Prevention of Money Laundering and Financing of Terrorism comes into force. Among other things, the Act regulates the operation of the Central Register of Beneficial Owners (CRBR). This is a system that collects and processes information on beneficial owners, i.e. natural persons exercising direct or indirect control over companies and other entities.

Until now, the obligation to make notifications to the CRBR concerned primarily commercial law companies. Pursuant to the Law on amending the Law on Anti-Money Laundering and Financing of Terrorism and certain other laws of 30 March 2021 (Journal of Laws of 2021, item 815), the circle of entities obliged to make a notification to the Register of Beneficial Owners has been expanded to include, among others, cooperatives and European cooperatives. These entities are obliged to make a notification to the Central Register of BeneficialOwnerswithin 3 months from the date of entry into force of the amendment, i.e. from 31 October 2021.

The notification to the CRBR is made by a person authorised to represent a given entity (in practice it will be the management board of a cooperative). It shall be made free of charge by means of electronic communication. The notification shall be submitted in the form of an electronic document in accordance with the template made available by the minister competent for public finance. The notification should be made via the website: https://www.podatki.gov.pl/crbr/. The notification should bear a qualified electronic signature or a signature confirmed by the trusted ePUAP profile and contain a statement of the person making the notification to the Register on the veracity of the information reported to the Register.

The Act contains a very extensive definition of a beneficial owner. In order to simplify, it should be indicated that it is a natural person who directly or indirectly controls a given entity and who has an actual or legal possibility to exert a decisive influence on this entity. In the case of cooperatives, members of the management board should be regarded as such persons.

Failure to comply with the obligation to notify the CRBR may result in a fine of up to PLN 1,000,000 being imposed on persons responsible for its implementation.

The second significant change, which came into force on 5 October 2021, is related to the amendment of the Act on electronic delivery (Journal of Laws of 2020, item 2320). By the above-mentioned Act, the legislator amended the content of Article 16 of the Cooperative Law, giving it the following new wording:

§ 1. The condition for admission as a member is the submission of a declaration. The declaration should be submitted in writing recorded in paper or electronic form. The letters recorded in electronic form shall be sent to the electronic delivery address of the cooperative as referred to in Article 2 item 1 of the Act of 18 November 2020 on Electronic Delivery (Journal of Laws, item 2320) and shall bear a qualified electronic signature, a personal signature or a trusted signature. A letter fixed in paper form shall bear a handwritten signature. The declaration signed by the acceding member should contain his/her name and place of residence, and if the acceding member is a legal person – its name and seat, the number of declared shares, data concerning contributions, if the statutes provide for their payment, as well as electronic delivery address referred to in Art. 2 item 1 of the Act of 18 November 2020 on electronic delivery, entered in the database of electronic addresses referred to in Art. 25 of that Act, if the acceding member has such, and other data provided for in the statutes.

§ 2. If the cooperative is at the same time an obliged institution within the meaning of the Act of 1 March 2018 on the prevention of money laundering and terrorist financing (Journal of Laws of 2020, item 971, 875, 1086 and 2320), the declaration referred to in § 1 may also be submitted under nullity in documentary form within the meaning of Article 77(2) of the Civil Code. In such a case, the provisions of the Act referred to in the first sentence shall apply to the identification and verification of the identity of the person who seeks admission as a member.

The amendment of Article 16 of the Cooperative Law consists in enabling the submission of a membership declaration in writing recorded in paper or electronic form. The changes, coming into force as of 5 October 2021, correspond with the obligation to have an address for electronic delivery entered in the so-called electronic address database, linked to a public registered electronic delivery service or a qualified registered electronic delivery service imposed on cooperatives in Article 9(1)(8) of the Electronic Delivery Act. According to this provision, each entity entered in the Register of Entrepreneurs of the National Court Register (i.e. also housing cooperatives) is obliged to have an address for electronic delivery entered in the database of electronic addresses, connected to the public registered electronic delivery service or a qualified service of registered electronic delivery.

The amended provisions allow members of housing cooperatives to submit membership declarations in electronic form (this possibility applies to persons acquiring membership on the basis of a declaration – i.e. persons acquiring separate ownership of premises and tenants of cooperative premises) by sending them electronically to the cooperative’s e-mail address. However, in order to be able to fulfil the above obligation it is not sufficient to have a regular e-mail address. It will be necessary to use a special e-delivery application that will allow sending and receiving electronic correspondence being the equivalent of registered mail (registered or with return receipt).

In order to create a public address, it will be necessary to submit a relevant application to the minister competent for informatisation. Once the e-mail address has been entered into the database of electronic addresses, it will be possible to receive membership declarations submitted electronically.

Polish entrepreneurs in most sectors are experiencing a shortage of workforce. So far, they have been supported largely by citizens of Ukraine working temporarily in Poland. Despite the influx of hundreds of thousands of foreign workers, the number of vacancies in enterprises remains high. In an attempt to remedy this, the Ministry of Interior and Administration has prepared amendments to several acts regarding the provision of work by foreigners (these are the acts: on foreigners, promotion of employment and labour market institutions, and minor amendments to the Act on the Card of the Pole and repatriation). Below is a brief description of the most important changes:

1. Visas for students – reduction of the time limit for issuing Schengen visas for students from 60 to 30 days.

2. Issuance of national visas – the deadline for extending the proceedings due to the consul or the Ministry of Foreign Affairs requesting information from the President of the Office for Foreigners as to whether there are circumstances justifying a refusal to issue a visa has been shortened from 60 to 30 days.

3. Introduction of the possibility of considering applications for visas out of turn – the Act gives the Minister of Foreign Affairs, in agreement with the Minister of Internal Affairs, the right to issue regulations allowing for considering applications from a given country out of turn. At the same time, the same regulation may specify the professions for which the issuance of visas will also be considered out of turn.

4. Temporary residence permits – the amendment introduces a deadline for the decision to be issued – within 60 days, provided all documents have been submitted and the foreigner has appeared in an office in person.

5. The Act introduces the possibility of electronic communication between a voivodship office and the authorities of the Police, Border Guard, Internal Security Agency and consular services with regard to seeking an opinion on a foreigner during the procedure for issuing a temporary residence permit.

6. The obligation to have a stable and regular source of income is abolished and replaced by a requirement that the work which is to be entrusted to a foreigner must be remunerated at least at the minimum wage. 

7. The obligation to provide a place of residence is eliminated.

8. Pursuant to the new provisions of the Act, a change of the registered office or place of residence, name or legal form of the entity employing a foreigner, the takeover of an employer or a part thereof by another employer, the transfer of an establishment of work or a part thereof to another employer, the replacement of a civil law contract by an employment contract, a change of the name of the position at which the foreigner performs work while retaining the scope of his/her duties, or an increase in the working time with a proportional increase in remuneration do not require an amendment or a new temporary residence and work permit.

9. A foreigner will have the right to apply for a change of the residence and work permit if he/she intends to change the employer.

10. One of the most important issues is that all proceedings for issuing a work and residence permit that are pending at the moment of entry into force of the Act should be terminated by issuing a decision on granting a residence permit, except for situations when a foreigner is on a list of persons whose residence in the Republic of Poland is undesirable, his/her data is in the Schengen Information System for the purpose of refusing entry or it is opposed by defence reasons, security reasons, public order reasons or obligations arising from international agreements.

11. The period of work on the basis of a statement on entrusting work is extended from 6 months to 24 months.

The planned changes are likely to contribute to the acceleration of certain procedures related to obtaining work and residence permits by foreigners. It remains an open question to what extent the rigid deadlines introduced will actually be observed and implemented. The relaxation of the requirements for obtaining work and residence permits as well as the extension to 24 months of the period in which it is possible to work on the basis of a statement on the commission of work certainly deserve praise. The effect of the amendments may be to increase the influx of foreign workers, who are so necessary to the economy.