CEE Legal Matters

Author: admin

  • Kondracki Celej and JSP Skrzypek and Partners Advise on Pre-Series A Round for Prosoma

    Kondracki Celej, working with SZA Schilling, Zutt, Anschutz, Ingen-Housz, and Sparring Legal, has advised Impact Ventures and Verge HealthTech Fund on participating in the EUR 4.4 million pre-series A round for Prosoma. JSP Skrzypek and Partners, and reportedly Van Campen Liem, advised Prosoma.

    The round also saw the participation of Convergence Partners, Smartlink Partners, Simpact Ventures, and a group of existing VCs and private investors.

    Prosoma is a digital oncology care startup providing digital therapeutics for cancer patients. According to Kondracki Celej, the funding will allow Prosoma to accelerate its expansion in the DACH region and the US market as well as explore new reimbursement avenues.

    The Kondracki Celej team included Partner Rafal Celej, Senior Associate Arkadiusz Klejnowski, and Associate Weronika Dabrowska. 

    The JSP Skrzypek and Partners team included Managing Partner Maciej Skrzypek, Partner Beata Danel-Skrzypek, Senior Lawyer Karolina Till, and Junior Lawyer Szymon Pawlak.

  • Laszlo Palocz Returns to Kinstellar

    Former Indotek Group Senior M&A Legal Counsel Laszlo Palocz has returned to Kinstellar, joining the firm’s Budapest office as Counsel.

    Before the move, Palocz spent two years with Indotek, between 2023 and 2025. Earlier, he was with Kinstellar for more than six years, joining the firm initially as a Junior Associate in 2016, becoming an Associate in 2017, and a Senior Associate in 2022. Earlier still, he was a Junior Associate with EY between 2015 and 2016 and with Gal and Partners between 2014 and 2015.

    “I am thrilled to rejoin Kinstellar and reunite with my former colleagues,” Palocz said. “This is an incredible opportunity to leverage the knowledge and experience I have gained working on transactions all over Europe as an in-house M&A legal counsel since my departure two years ago while continuing to work on exceptional projects alongside this outstanding team. I look forward to contributing to the firm’s ongoing achievements.”

    “We are delighted to welcome Laszlo back to our team,” commented Managing Partner Balazs Sepsey. “His experience, solution-driven approach, and collegial attitude have always been highly valued by both clients and colleagues.”

    “Laszlo’s return is great news for our team,” added Partner Gabor Gelencser. “His professional expertise in M&A, combined with his approachable nature and work attitude, aligns perfectly with our values. He will be a key contributor to the strength of our team and the quality of service we provide to our clients.”

    Originally reported by CEE In-House Matters.

  • CMS Advises AEW on Sale of Myslbek to Max Realitni Fond SICAV

    CMS has advised AEW on the sale of the Myslbek office and retail project to Max Realitni Fond SICAV.

    AEW is a capital management company.

    Max Realitni Fond is a real estate fund focusing on retail and office space.

    The CMS team included Partner Lukas Hejduk, Associate Sarka Hrda, and Lawyer Matous Jan Kadlecek.

    CMS did not respond to our inquiry on the matter.

  • North Macedonia Implements New National Classification of Activities

    The Government of North Macedonia adopted an updated version of the National Classification of Activities, NKD Rev. 2.1 (“New Classification”).

    The New Classification is aligned with the revised version of the Statistical Classification of Economic Activities in the European Community NACE Rev. 2.1.

    The New Classification is especially relevant for:

    1. Companies to be established: they will need to choose an appropriate priority activity under the New Classification;
    2. Existing companies: when submitting annual accounts, they will need to enter the main income code under the New Classification.

    The application for the New Classification started on 1 January 2025.

    The information in this document does not constitute legal advice on any particular matter and is provided for general informational purposes only.

    By Veton Qoku, Partner, and Ana Kashirskaa, Senior Associate, Karanovic & Partners

  • The “Right of Free Movement” in the Light of EU Cross-Border Transformation

    The Bulgarian Parliament has recently adopted an Act to amend and supplement the Bulgarian Commercial Act[1] implementing the requirements of Directive (EU) 2019/2121 of the European Parliament and of the Council of 27 November 2019 amending Directive (EU) 2017/1132 as regards cross-border conversions, mergers and divisions.

    I. INTRODUCTION OF CROSS-BORDER DIVISIONS

    1.        General requirements

    Prior to the adoption of the amendments, the Commercial Act provided for a possibility only for cross-border mergers under the following conditions:

    (a) all companies participating in the transformation[2] (“Participating Companies”) have their registered offices on the territory of an EU member state or of a state party to the EEA            Agreement, jointly referred to as “Member States”;

    (b) at least one of the Participating Companies has its registered office in another Member State, different from the Republic of Bulgaria;

    (c) the legal form of the Participating Companies from another Member State is one of those indicated in Art. 1 of First Council Directive 68/151/EEC of 9 March 1968[3];

    (d) the Participating Companies, which have their registered office in Bulgaria, are formed as share capital companies (exclusive of investment company with variable capital). Under Bulgarian law, share capital companies are the limited liability company (LLC), the joint-stock company (JSC) and the partnership limited by shares (each of which referred to as “Bulgarian Capital Company”).

    The new amendments provide that any company formed in accordance with the law of a Member State, which has not only its (i) registered office, but alternatively its (ii) central administration, or (iii) principal place of business in the same or another Member State may be subject to a cross-border transformation with a company formed under Bulgarian law. This is not to say that a company, which has its registered office outside a Member State is eligible to an EU cross-border transformation, but is rather to be construed in a way that a company, which has its registered office in one Member State and central administration or principal place of business in another Member State, may choose to engage in transformation under the laws of the latter Member State instead of the former.

    This is a practical manifestation of the longstanding EU’s legislative practice of regulating private law matters in accordance with the principle of closest connection. In terms of business, this may provide a fair degree of flexibility, unlike keeping solely to the criterion of “registered office”, which is rather rigid and, in many ways, impractical under the conditions of EU single market.

    2.         Procedure

    In essence, the introduced amendments do not change the conversion procedure. For the sake of simplicity, the latter could be described as “two-phase”.

    2.1 In the first “phase” each of the Participating Companies takes all the necessary corporate approvals, actions and filings in accordance with the national laws of the Member State of their formation. The implementation of the requirements of the national law of a Member State with respect to a Participating Company is attested by a pre-merger[4] or pre-division[5] certificate, as applicable, which is issued by the authority competent to scrutinize the legality of the transformation and confirm compliance with all relevant conditions and proper completion of all procedures and formalities in the respective Member State. The issued pre-merger or pre-division certificates are shared between the competent Member State authorities through the system of interconnection of registers.

    2.2 In the second “phase” of the procedure, where the process of conversion is finalized, the authorities of one of the Member States assume the “leading role” in the actual completion and registration of the transformation. The completion of the registration by the leading Member State gives legal effect to the cross-border transformation and determines its date. Which Member State should have the leading role is largely dependent on the exact form of transformation.

    To make it clearer through an example, in all the cases when the registered office of:

    (a) the newly formed (as a result of merger by the formation of a new company – it. 3.2 below);

    (b) the acquiring (as a result of merger by acquisition – it. 3.1 below); or

    (c) the converting (as a result of any form of division – it. 3.3 – 3.5 below)

    company is in Bulgaria, the registration of the relevant circumstances in the Bulgarian Commercial Register[6] made under Bulgarian law shall give legal effect to the transformation and its effective date will be the date of such registration. In this case the Bulgarian Commercial Register must notify the competent authorities of the respective Member States of the occurrence of the registration and its date through the system of interconnection of registers. The said facts are to be taken into account by the Member States’ authorities with respect to any registrations related to Participating Companies under their jurisdiction. The above applies vice versa in cases when the registered office of the company under it (a) – (c) above is outside Bulgaria.

    3.         New forms of transformation

    Prior to the discussed amendments, the forms of cross-border transformations under Bulgarian law were limited to two (it. 3.1 – 3.2 below), while at present there are three additional options for cross-border transformations (it. 3.3 – 3.5 below), namely:

    3.1 Merger by acquisition

    Under this form of corporate transformation, all the assets and liabilities of one or more companies (transforming companies) are transferred to an existing company (acquiring company), which becomes their legal successor and the transforming company(-ies) are wound up without going into liquidation.

    3.2 Merger by the formation of a new company

    In this case all the assets and liabilities of two or more companies (transforming companies) are transferred to a newly established company, which becomes their legal successor, while the transforming companies are wound up without going into liquidation.

    3.3 Full Division

    This is a scenario in which all the assets and liabilities of a company (transforming company) passes to two or more newly formed companies (recipient companies), which become its legal successors for the corresponding part of those assets and liabilities. The transforming company is wound up without going into liquidation.

    3.4 Partial Division

    Upon partial division, part of the assets and liabilities of a company (transforming company) passes to one or more newly formed companies (recipient companies), which become the legal successor(s) of those assets and liabilities. The key difference in comparison to the full division is that upon partial division the transforming company is not wound up and continues its existence.

    3.5 Division by separation

    The division by separation basically represents a sub-type of the partial division, according to which a separation of the assets and liabilities of a company (transforming company) is made and transferred to a newly formed company (recipient company). Differentia specifica of the division by separation vis-à-vis the partial division is that: (a) the capital of the recipient company is fully owned by the transforming company and not the shareholders in the latter; (b) under Bulgarian law the recipient company may be incorporated either as a single-member LLC or a single-member JSC.

    It is to be noted that Directive (EU) 2017/1132 is still reluctant to adopt rules on cross-border divisions, under which the recipient companies are not newly formed, but already existing. Arguably those would be the most complex among any other forms of cross-border transformations. Besides to technical complications with international element, this caution may be due to reasons of legal character, stemming from all the pre-existing legal relations, which an existing company is bound by. Those could lead to problems e.g. in the order (privileges) for satisfaction of the receivables of private creditors, conflict between tax authorities from different Member States, which are public bodies belonging to the administrative system of sovereign countries, employment and social-security related problems due to the differences between national legislations, etc.

    4.         Shareholders’ protection

    Among other amendments, it is worth mentioning that a shareholder in a transforming company who has voted against the decision of the General Meeting of the Shareholders (“GMS”) for the transformation has the right to leave the transforming company in consideration of a payment of a monetary compensation (corresponding to the equivalent of the shares owned by him/her) if, as a result of the conversion, such shareholder acquires shares in a company from another Member State. Termination of the shareholder’s participation is made with a notarized notification, sent within 1 (one) month as of the date of holding the GMS and the monetary compensation must be paid within no later than 2 (two) months after the date of the transformation.

    The above is an example of the manner in which the EU law creates the necessary mechanisms so that the core values and freedoms of the EU, installed in specific individual rights, apply to the majority, but also, in an adequate proportion, to each affected individual.

    II. “FREE MOVEMENT” OF COMPANIES

    1.        Freedom of establishment

    The amendments of the Commercial Act take the freedom of establishment under Art. 54, para. 2 of the TFEU to an entirely different level.

    The amendments allow for a capital company (converting company), which has its registered office on the territory of Bulgaria (departure Member State) to “move” to another Member State (destination Member State) provided that:

    (a) the converting company changes its registered office in the destination Member State;

    (b) the converting company adopts the legal form of a company that was established in accordance with the legislation of the destination Member State, which needs to be one the types listed in Annex II Directive (EU) 2017/1132,

    following the completion of the conversion in compliance with the above, such company is to be referred as the “converted company”.

    The same applies vice versa for any company formed under the laws of a Member State other than Bulgaria (departure Member State) and having a legal form listed in Annex II Directive (EU) 2017/1132, which intends to “move” its registered office to Bulgaria (destination Member State) and adopts the legal form of a Bulgarian Capital Company.

    2.        Procedure

    When the converted company receives its registered office in Bulgaria, the Bulgarian Commercial Register completes the registration of the conversion after the competent authority of the departure Member State issues the pre-conversion certificate[7], to be exchanged through the system of interconnection of registers. The date of the conversion is the date of its registration in the Bulgarian Commercial Register.

    In case that the converting company had its registered office in the Republic Bulgaria, it has to be deregistered from the Bulgarian Commercial Register on the basis of a notification sent by the competent authority of the destination Member State, confirming the conversion is duly completed in its register. The date of conversion is a date determined by the legislation of the destination Member State.

    3.        Legal effect

    From the date of conversion:

    (a) the converting company from another Member State moves its registered office to Bulgaria and continues to exist as a Bulgarian Capital Company of the relevant type;

    (b) the converting company from Bulgaria moves its registered office to another Member State and continues to exist as a company according to the law of that Member State;

    (c) the rights and obligations of the converting company become the rights and obligations of the converted company;

    (d) the shareholders in the converting company become shareholders in the converted company.

    The right under Section I, it. 4 is at the disposal of the shareholders of the converting company, which have voted against the conversion.

    4.        Potential economic impact

    The discussed amendments may be considered as the climax of the right of free establishment in the context of formation of corporate entities. At first sight it may seem as entirely positive due to the flexibility it offers to business.

    On the other hand, it may deprive some national economies from profitable business players, which in the pursuit of larger revenue or market share may easily decide to “migrate” to larger national markets. Although this will not be detrimental to the EU single market, it may have its downsides on Member States with smaller-scale economies.

    Looking again from the opposite perspective, it may create a positive competition stimulus between Member States, which will likely adopt proper measures trying to retain or attract, respectively, the large commercial players within their national economies and under their tax jurisdictions. Such measures may include lowering tax rates, decreasing the levels of bureaucracy, easing access to markets, investing in the education of qualified workforce, maintaining lower costs/assuming part of the costs of energy supplies and many other.

    In conclusion, we can say that there is enough time for Bulgaria to prepare for any effects those amendments could cause, as the Final Provisions of the Act to Amendment and Supplement the Commercial Act gives a term of 1 (one) year to the Bulgarian Registry Agency to ensure the technical possibility for practical application of the amendments discussed.

    [1] Published in State Gazette issue No. 82 of 27 September 2024.

    [2] “transformation” is used throughout this article as a generic term for mergers, divisions and conversions.

    [3] This reference should be read as a reference to Annex II Directive (EU) 2017/1132, which repeals Directive 2009/101/EC repealing First Council Directive 68/151/EEC.

    [4] Under Art. 127 of Directive (EU) 2017/1132.

    [5] Under Art. 106m of Directive (EU) 2017/1132.

    [6] Its full name is Bulgarian Commercial Register and Register of Non-Profit Legal Entities, which is maintained by the Registry Agency at the Ministry of Justice.

    [7] Art. 86m of Directive

    By Hristian Gueorguiev, Senior Associate, Boyanov & Co

  • Well-Known Trademarks: Legal Standards and Determination Criteria

    Trademarks are more than just logos and brand names—they are powerful symbols that represent the values, quality, and recognition of a company or product. From the iconic swoosh of Nike to the golden arches of McDonald’s, well-known trademarks have become ingrained in our daily lives, shaping our consumer habits and perceptions.

    These marks are often the result of years of marketing, innovation, and customer loyalty, transforming simple designs into symbols of trust and excellence. But what makes a trademark “well-known”? It’s the combination of recognition, history, and influence that makes these marks stand out in crowded marketplaces. In this world of branding, a strong trademark can be the key to success, making its owner a household name across the globe.

    The first convention to regulate the well-known trademarks is the Paris Convention for the Protection of Industrial Property (adopted in 1883). Article 6-bis of the Convention defines that:
    The countries of the Union undertake, ex officio if permitted by their legislation, or at the request of an interested party, to refuse or cancel the registration, and to prohibit the use, of a trademark that constitutes a reproduction, imitation, or translation liable to create confusion of a mark considered by the competent authority of the country of registration or use to be well-known as the mark of a person entitled to the benefits of this Convention and used for identical or similar goods.

    These provisions also apply when the essential part of the mark constitutes a reproduction or imitation liable to create confusion with a well-known mark. A period of at least five years is allowed for requesting the cancellation of such a mark. Additionally, countries of the Union may stipulate a specific timeframe within which the prohibition of use must be requested. However, no time limit is fixed for requesting the cancellation or prohibition of use for marks registered or used in bad faith.

    What are Well-Known Trademarks?

    Well-known trademarks are those that have achieved widespread recognition and distinctiveness beyond the specific goods or services they represent.

    However, determining whether a trademark is well-known or not can sometimes be a complex and nuanced process.

    To facilitate and unify the process of assessing whether a trademark has become well-known, the Assembly of the Paris Union for the Protection of Industrial Property and the General Assembly of the World Intellectual Property Organization (WIPO) at the thirty-fourth series of Meetings of the Assemblies of the Member States of WIPO, held on September 20 to 29, 1999, have adopted Joint Recommendations concerning provisions on the protection of Well-Known Marks.

    Factors for consideration

    According to Article 2 of these Joint recommendations, in determining whether a mark is a well-known mark, the competent authority shall take into account any circumstances from which it may be inferred that the mark is well known. In particular, the competent authority shall consider information submitted to it with respect to factors from which it may be inferred that the mark is, or is not, well known, including, but not limited to, information concerning the following the criteria for assessing well-known marks include:

    1. The degree of knowledge or recognition of the mark in the relevant sector of the public. The degree of knowledge or recognition of the mark can be determined through consumer surveys and opinion polls. 
    2. The duration, extent, and geographical area of use of the mark. The duration, extent, and geographical reach of the mark’s use are highly relevant indicators of its recognition and status as well-known by the relevant sector of the public.
    3. The duration, extent, and geographical area of any promotion of the mark, including advertising or publicity and the presentation, at firs or exhibitions, of the goods and/or services to which the mark applies. This includes the duration and geographical area of promotion activities, such as advertising and participation at fairs or exhibitions. Promotion can occur through various media, including print and digital channels.
    4. The duration and geographical area of any registrations, and/or any applications for registration, of the mark, to the extent that they reflect use or recognition of the mark. The duration and geographical extent of registrations and applications for registration of the mark reflect its use and recognition. The number of global registrations serves as a strong indicator of a mark’s widespread recognition, even if owned by multiple entities within a group. 
    5. The record of successful enforcement of rights in the mark, in particular, the extent to which the mark was recognized as well known by competent authorities
    6. The Value associated with the mark. The inherent value of a mark may be assessed through various valuation methods. This criterion acknowledges that the value may indicate whether the mark is widely recognized.

    Additional Considerations

    While the criteria outlined serve as guidelines for assessing whether a mark is well-known, they are not strict prerequisites for making a determination. In some cases, all criteria may be relevant, while in others, only a few may apply. In certain situations, additional factors may also influence the decision, which could be considered alone or in conjunction with the listed criteria.

    In summary, well-known trademarks play a significant role in intellectual property law, and the above criteria ensure a comprehensive assessment of their recognition and protection.

    By Ivana Jevtic Nikolova, Partner, JPM (North Macedonia)

  • Increasing Tax Burden on Energy in Hungary

    As part of the fall tax package, the Hungarian Government proposed an automatic, inflation-tracking increase of tax on, inter alia, energy products as of 2025. The actual increase from 1 January 2025, however, significantly exceeds the current (and expected) inflation levels. This might concurrently lead to increased inflation again.

    Under the automatic tax increase system, after 2024, the rate of the taxes and duties in question would be the amount of the tax rate (or amount) for the year before the tax year in question, valorised (i.e. increased) by the change in the consumer price index for July of the year before the tax year in question compared to the same period of the previous year, as published by the Central Statistical Office (KSH). For 2025, this means an increase of 4.1%, which is equal to the official inflation rate in July 2024.

    There are three main areas where the new inflation tracking taxation (or duty obligation) was introduced as of 2025:

    (1) motor vehicle-related taxes and duty, including registration tax (payable on cars and motorcycles), car tax, company car tax (from 2026) and transfer duty on the transfer of motor vehicles and trailers;

    (2) energy products, including tax on petrol, diesel and LPG; and

    (3) the specific excise duty on alcohol products – beer, wine, spirits – and tobacco products

    Although the official inflation rate is 4.1% – and the 2025 draft budget law only foresees an inflation rate of 3.2% (at least for pension payments) – the increase of excise duty on some energy products is more than threefold that and goes into two-digit territory, as follows:

    • 12.5% for natural gas (when offered, sold or used as fuel by road vehicles – +4 HUF per standard m³);
    • 11.2% for coal (+325 HUF/1000 kg); and
    • 11% for electricity (+39.5 HUF/MWh).

    This increase applies to non-residential consumers (practically for B2B relations). However, it is also likely to be reflected in the pricing of corporate power purchase contracts, as the increased costs are likely to be passed on in prices. It also follows that if energy prices go up, it would trigger an indirect increase in the inflation level as well, further triggering automatic excise duty increases in the following years.

    By Balint Zsoldos, Head of Tax, KCG Partners Law Firm

  • Just Before January Slips Away: The CEE Legal Matters January 2025 Magazine Is Out Now!

    We know, we know – January may be nearly over, but the year is just getting started, with new challenges, fresh opportunities, and a full calendar ahead! The first issue of CEE Legal Matters this year has landed just in time to keep you updated on everything shaping the CEE legal markets.

    Subscribers should be receiving their hard copies in a week or two, but no need to wait for the mail to arrive: the online version of the magazine is already available here. With Market Spotlights on Ukraine and Montenegro and an Experts Review section on Banking/Finance, the January 11.12 issue includes:

    With the January 2025 issue of the magazine now out, let’s remember what last year looked like: our November 2024 issue has now been moved from behind the paywall and been made available to subscribers and non-subscribers alike (here in e-reader format and here in pdf).

    With Market Spotlights on Serbia and North Macedonia and an Experts Review section on Labor, the November issue included:

    Stay abreast of the latest developments and legal news, across CEE. Don’t miss any of the upcoming issues: register for a subscription to the CEE Legal Matters magazine now!

  • CEE Legal Matters Issue 11.12

    We know, we know – January may be nearly over, but the year is just getting started, with new challenges, fresh opportunities, and a full calendar ahead! The first issue of CEE Legal Matters this year has landed just in time to keep you updated on everything shaping the CEE legal markets.

    The PDF version of the magazine is here. All online versions of the articles in Issue 11.12 are here. They include: 

    With Market Spotlights on Ukraine and Montenegro and an Experts Review section on Banking/Finance, the January 11.12 issue includes: 

  • Looking In: Anders Fast of Baker McKenzie

    In our Looking In series, we talk to Partners from outside CEE who are keeping an eye on the region (and often pop up in our deal ticker) to learn how they perceive CEE markets and their evolution. For this issue, we sat down with Baker McKenzie Stockholm Partner and a member of the firm’s Global Executive Committee Anders Fast.

    CEELM: What was your first interaction with the CEE region?

    Fast: My personal journey with the CEE region began in the late nineties when I did my first transactions involving the CEE region. Since then, I have had the pleasure of working on numerous projects and transactions in the region.

    Witnessing the transformative changes in the CEE markets has been incredibly rewarding. Since the opening of our first CEE office in Budapest in 1987, Baker McKenzie has significantly expanded its footprint. With close to 400 lawyers in six markets, we are now one of the biggest international law firms in the region.

    CEELM: What has been keeping you busy in the last 12 months?

    Fast: The CEE region is very diverse, and businesses operating in the region are faced with complex legal landscapes, significant compliance challenges, and fluctuating market conditions. We advise our clients in the region on a broad mix of transactional, contentious, and advisory matters across multiple sectors.

    In Hungary for instance, compliance and investigation work surged for us in the past year, partly driven by the rise of AI, which presents novel legal challenges. We have also seen strong demand in the private M&A sector, with a focus on mid-market transactions, as well as foreign direct investments in the automotive industry.

    Distressed M&A, carve-outs, and post-M&A dispute work have been prominent in Austria. Insolvency work has also kept our teams in both Austria and the Czech Republic busy. Our lawyers in the Czech Republic have also advised our clients on a significant number of M&A transactions, in particular in the IT, energy, pharmaceuticals, and healthcare sectors.

    The rebound of the commercial real estate market in Poland has generated various workstreams for our transactional teams. We have also advised several Polish companies active in Ukraine’s reconstruction efforts and seen an uptick in tech sector disputes as well as energy transition projects – an area in which we have strengthened our capabilities this year with the addition of Agnieszka Skorupinska in Warsaw.

    In Ukraine, we had a strong focus on transactions in the infrastructure, energy, and agricultural sectors, along with banking regulatory work and sanctions compliance advice for both international and domestic businesses.

    CEELM: What are the sectors or industries poised for growth in CEE?

    Fast: The CEE markets’ competitive edge has long been rooted in the manufacturing sector. The Czech Republic, Poland, and Hungary consistently rank among the top industrial performers globally, with Hungary poised to be Europe’s number one battery cell producer by 2026. While Europe’s electric vehicle (EV) market saw a slowdown in 2024, the CEE region is expected to see growth through investments, in particular in the Czech Republic.

    At the same time, the growth model of the region is evolving, with a gradual shift toward higher value-added services. For instance, the technology sector – particularly AI and digital services – is rapidly expanding in Hungary, the Czech Republic, and Austria. The defense, military technology, and advanced manufacturing sectors, including drone technology, also present new opportunities.

    Despite the ongoing conflict, Ukraine’s infrastructure shows significant growth potential by 2033. Polish companies are already investing in Ukraine, leveraging cultural proximity and knowledge in public procurement in sectors such as energy, transport, and construction.

    Lastly, the energy sector will continue to grow in the region, with a focus on renewables, nuclear energy, and modern energy infrastructure development, in particular in Poland, Hungary, Austria, and the Czech Republic. This is driven by a combination of EU sustainability goals and national initiatives.

    CEELM: What are the most promising markets in CEE? What about the most challenging?

    Fast: Poland’s economy is projected to grow by 4% in 2025. Over the past three decades, the country’s rapid GDP per capita growth has made it a prime destination for FDI, particularly in the EV supply chain. Its strong industrial base, growing tech sector, and strategic location make it a promising market.

    Meanwhile, in light of the ongoing war, Ukraine is currently the most challenging market but is also likely to present significant opportunities in the longer term. The country’s legal and institutional framework, along with its natural and human resources, make it a promising market for reconstruction-focused investment, particularly in the energy and transport sectors, as well as investment in its titanium and lithium resources.

    At a macro level, financing costs and regulatory hurdles across the region continue to pose significant challenges. Embracing innovation and new technologies will be pivotal in evolving the growth model and driving future economic development.

    CEELM: What is your perspective on international companies in CEE? How will their presence evolve?

    Fast: The presence of international companies in the CEE region is expected to grow, building on what global businesses already see as a favorable environment. Investment volumes across the CEE-6 region reached EUR 5 billion in 2024, with Turkiye alone recording USD 417 million in FDI inflows via equity capital. This is driven by the CEE’s proximity to major markets and the region becoming a hub for manufacturing sectors such as electronics, machinery, and high-value goods, and a destination for Shared Service Centers and Business Service Centers (BCSs). More than 200 multinational corporations operate BCSs in Hungary alone.

    Several elements suggest that this trend will continue, although global geopolitical risks may slow the pace of international expansion. The International Monetary Fund predicts that the CEE region’s real GDP growth will surpass the G7 average by 2027, and industrial production is expected to grow at an average rate of 2.8% from 2025 to 2030. More tech giants are establishing themselves in the region too, making CEE a hub for research and development activities with Poland, the Czech Republic, and Hungary being particularly attractive. The region is also a nearshoring hotspot for multinational companies, offering advantages such as geographical proximity, business resilience, and greenfield opportunities.

    CEELM: What types of work do you expect to see the most in the next 12 months in CEE?

    Fast: Although high interest rates and inflation remain challenging, the CEE region’s strengths, adaptability, and market maturity provide a solid foundation for growth. From an M&A perspective, we anticipate the value of deals will increase, with a focus on larger, strategic investments.

    Nearshoring will continue to attract FDI, particularly in higher value-added sectors such as IT and business services. There will also be continued emphasis on attracting strategic investments in sectors like digital infrastructure, clean technologies, and AI, which are crucial for maintaining competitiveness and fostering innovation. This will pick up in Hungary, the Czech Republic, and Poland, where the ICT sector is expanding due to digitalization and their skilled workforce.

    It is also important to recognize the impact of global dynamics on regional activity. The global energy transition remains a focal point across the entire region, with significant investments in renewables, nuclear projects, and infrastructure modernization on the horizon. Meanwhile, Austria will likely see more distressed M&A opportunities, particularly in sectors such as retail, hospitality, startups, and manufacturing, which are more vulnerable in the current economic context.

    Despite global shifts, some regional sectors will maintain strong momentum. Hungary’s automotive industry, a cornerstone of the economy, will see steady growth even amid uncertainties. Poland’s real estate market – in particular in terms of office spaces and ESG upgrades – is also projected to remain robust, reflecting sustained investor confidence and demand.

    This article was originally published in Issue 11.12 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.