Category: Poland

WKB Wiercinski Kwiecinski Baehr has advised Qualia Development Sp. z o.o. on the sale of Residence Management Sp. z o.o. to Chopin Airport Development Sp. z o.o. The conditional share sale agreement was signed in the presence of Polish Prime Minister Mateusz Morawiecki during the 28th Economic Forum in Krynica. Closing remains contingent on clearance by the Office of Competition and Consumer Protection.

Residence Management, which is managed by Qualia Development, is the owner of the Golden Tulip Residences in Gdansk and Miedzyzdroje. As the result of the transaction the two properties will be owned by Chopin Airport Development.

WKB’s team consisted of Partners Jakub Jedrzejak and Anna Wyrzykowska and Senior Associates Magdalena Piszewska and Karol Filipiuk. 

Wierzbowski Eversheds Sutherland has advised Grupa Netsprint, an Innova Capital portfolio company, on its acquisition of Way To Grow, a company that specializes in optimizing the advertising space of publishers in a programmatic model. Way To Grow reportedly was represented by Everberg.

WaytoGrow was founded in 2014 by Dominik Czarnota, Janusz Michalik, and Lukasz Grodecki, who had worked together on sites like nk.pl and Interia.pl.

According to Wierzbowski Eversheds Sutherland, “adding Way To Grow is the next step for Grupa Netsprint in implementing a strategy based on data and advanced algorithms.”

Monika Bronowska, CEO of Grupa Netsprint, said: “Now we will be able to offer our partners even more comprehensive services and even more effectively support their business. An effect of synergy will also be the intensification of activities on other markets.”

Dominik Czarnota, one of the founders of Way To Go, added: “We have a very committed team in which we strive to maintain a balance between experience and the potential of young people. Thanks to this, we power each other to work, and this translates into better and better results for the company.”

The team at Wierzbowski Eversheds Sutherland advising Grupa Netsprint included Partners Michal Karwacki and Ewa Szlachetka, Senior Associates Pawel Lasota and Natalia Burchardt, and Associate Marek Tolcz. 

Among the most acute challenges that Poland is facing at the moment are the well-publicized changes to the country’s court system, says Karolina Stawowska, Partner at Wolf Theiss.

The changes include new laws affecting the country’s Supreme Court, such as the replacement of 27 out of 74 judges through introduction of a rule requiring judges to retire at 65, which would, among other things, force current Chief Justice Malgorzata Gersdorf to resign. This, combined with expansion of the Supreme Court to 120 judges, gives the current government the power to appoint almost two-thirds of the judges. However, Stawowska believes the new laws violate the Polish Constitution. “The law says that the position of the Chief Justice is held for six years,” she says, referring to Gersdorf, “and this time has not yet concluded for her.” Indeed, Gersdorf has, so far, refused to step down.  

Unsurprisingly, certain provisions of the new law are being appealed to the European Court of Justice. In the meantime, the ruling Law and Justice party is pushing the changes forward. According to Stawowska, many believe the situation may result in a lowering of the public’s trust in the country’s judicial system, particularly with regard to rulings made during this period. “If the current government replaces judges and the EU tribunal finds that the changes are illegal,” she says, “it means those court rulings by the new judges might not be binding.” She notes that certainty and consistency in the judicial system are critical for both individuals and businesses.

The Law and Justice party has also introduced a new “disciplinary chamber” into the system to initiate disciplinary proceedings against judges, with members of the disciplinary chamber linked to the country’s Ministry of Justice, even though, Stawowska says, “from a legal perspective they are supposed to be selected by an independent body.”

“All of the changes have planted fears that the judges will lose their independence,” Stawowska says, “because government officials will have the power of the disciplinary chamber.”

The Law and Justice party is continuing to reform the country’s Tax Code as well, with a draft law expected to come into effect in January 2019. “While the vast majority of the planned changes are unfortunately painful for taxpayers,” Stawowska says, “I have to admit some of them are favorable.” One such change is the reduction of the corporate income tax rate for small companies to 9%, and another involves an increased regulation of trade in bitcoins. The changes “are currently under discussion and we still don’t know exactly what direction the law will go,” she says, though she notes that “at the same time, the new draft of the personal income tax and corporate income tax laws provide quite a lot of new restrictions and new ways that would eventually lead to an increase of effective tax rates.”

Maruta Wachta has advised Equitin Partners on the acquisition of a majority stake in Kids & Co., an operator of private kindergartens in Poland. LSW Lesnodorski Slusarek & Partners advised Kids & Co.

Kids & Co. operates 11 bilingual kindergartens and creches across Poland. According to a Maruta Wachta press release, Equitin Partners aims to cooperate with the founder and the management of Kids & Co. to accelerate the company’s development into the largest provider of early education services in Poland.

The Maruta Wachta team consisted of Partner Daniel Jastrun and Senior Associates Aleksandra Polak and Kamila Sawicka.

The Warsaw office of Hogan Lovells has advised Pekao Bank Hipoteczny on the issue of the public mortgage bonds.

According to Hogan Lovells, the issuance is the first of its type on the Polish market in the past five years. The total value of the August 30, 2018 issuance amounted to PLN 350 million, and the security pool consisted of receivables from loans granted to local government units.

The seven-year covered bonds were offered to institutional investors, and were jointly purchased by 24 entities, including investment funds (49%), open pension funds (30%), and insurance companies (21%).

The interest rate was determined as the sum of the WIBOR 3M reference rate plus a margin of 0.45%. Under the terms of issue, the mortgage bonds will be subject to partial redemption, i.e. their nominal unit value will be reduced by 2.75% on a quarterly basis. Final redemption has been set for September 10, 2025.

The Hogan Lovells team consisted of Partner Rafal Grochowski and Senior Associate Anna Kuczewska.

Former DLA Piper Poland Country Managing Partner Krzysztof Wiater, who left that firm in July of this year, has opened a new law firm in Warsaw: NGL Legal.

Wiater, who had been Country Managing Partner at DLA Piper Poland since the office opened in 2007, will lead the office. Other NGL Legal Partners include Magdalena Zwolinska, Grzegorz Godlewski, Maciej Wesolowski, Filip Opoka, and Bartosz Sankiewicz.

According to an NGL Legal press release, “In August 2018 Krzysztof opened NGL Legal – a new law firm with an ambition to become a center of legal services of the new generation in CEE/Baltics and globally, through a network of trusted partners. NGL Legal supports clients with legal and tax advisory combined with substantive knowledge and deep understanding of business consulting as well as selected sectors of the economy. NGL Legal is an open partnership with a team of new generation of experienced lawyers, who actively build expertise matching their individual interests. Idea behind is to develop experts with knowledge beyond legal, ensure lawyers are driven by passion and deliver spot on advice to clients.”

According to that press release, the firm’s independence is an asset: “CEE is diversified and quality of service varies, depending on exposure to experiences and breadth of practice. In each of the CEE countries top lawyers from sectors and practices may work with different law firms. Understanding this specific was key to creating our hybrid cooperation model with partners in CEE/Baltics and with global law firms. The idea behind was to offer clients an easy, independent access to top law practitioners, verified in their expertise, which ensures that top lawyers in their fields are working on the case, without limitation of operating under one brand. Cooperation with global partners allows us to support projects with international reach. All our partners operate independently, under their own brand and with direct contact with your team and NGL Legal is an integrator and your single point of contact.”

Greenberg Traurig has advised the HB Reavis Group on the sale of two A class office buildings that are part of the Gdanski Business Center complex in the center of Warsaw to Savills Investment Management, acting on behalf of Malaysia’s Employees Provident Fund. The value of the transaction exceeded EUR 200 million.

The entire GBC complex consists of four A class office buildings and provides approximately 100,000 square meters of general leasing area. The first two office buildings in the complex (GBC A and B) were sold in December 2016 for EUR 186 million, also to Savills. Both Greenberg Traurig and Clifford Chance were involved in that earlier deal as well.

This transaction, which involved the GBC C and D buildings, was conducted through the sale of the corporate structure (including the shares and rights and obligations of the general partners) owning the two office buildings. According to Clifford Chance, “the nearly 8-month-long transaction transformed during its course from a relatively simple real estate acquisition transaction into a complex share deal, involving also other jurisdictions, in particular Luxembourg, Netherlands, and Slovakia.” The firm described the deal as “one of the largest transactions on the Polish real estate market in 2018.”

The Greenberg Traurig team was led by Partner Radomil Charzynski, supported by Senior Associate Olga Durawa and Associates Filip Widuch and Jakub Gajzler.

The Clifford Chance team in Warsaw consisted of Partner Daniel Kopania, Counsel Aleksandra Jach, Senior Associate Katarzyna Perkowska, and Associate Anna Misztela, working with Luxembourg Senior Associates Frederique Davister and Stefany Sassi and Prague-based Senior Associate Stanislav Holec.

Freshfields Bruckhaus Deringer has advised XIO Group on the sale of 100% of the shares of Compo Expert GmbH to Grupa Azoty S.A. The buyers were advised by PwC Poland and CMS Germany.

The closing of the transaction is subject to certain conditions such as approval from merger control authorities and approval from Grupa Azoty’s shareholders.

CMS reports that the purchase price will not be higher than EUR 235 million.

Compo Expert is a manufacturer of specialty fertilizers for commercial use. The company owns and operates in Germany and Spain, and sells its products to customers across the world.

Grupa Azoty operates in the European fertilizer and chemical industry. The company is a European manufacturer of nitrogenous and compound fertilizers in the European Union. Additionally, the company produces melamine, caprolactam, polyamide, plasticizers, OXO alcohols, and titanium white, which are widely used across numerous industries.

The Freshfields team consisted of German Partners Heiner Braun, Markus Paul, Michael Josenhans, Wolrad Prinz zu Waldeck und Pyrmont, Michael Ramb, and Martin Schiessl, and Principle Associates Moritz Koch and Roman Eschke. The team also included Brussels-based Partner Sascha Schubert and Madrid-based Associate Guillermo Sanchez-Ostiz.

The PwC team in Poland consisted of Partners Wojciech Slowinski, Jolanta Kokosinska, and Rafal Drobka, and Senior Associate Tomasz Dziubak.

The CMS team was led by Berlin-based Partners Ralf Kurney and Igor Stenzel.

Former PWC Transfer Pricing Senior Manager Bartlomiej Wajda has joined CMS’s Tax group in Poland as Counsel, and to head the firm’s Transfer Pricing practice.

Wajda, a Polish-certified tax advisor, spent 11 months advising Polish and international capital groups on transfer pricing at PWC, which he joined in October 2017 after spending the previous three years with EY in Poznan. He previously spent almost four years with KPMG. According to CMS, he “specializes in the structuring of intra-group transactions and designing transfer pricing policies, verification of business restructurings, drafting transfer pricing documentation, and valuation of different flows. Furthermore, Bartlomiej took part in negotiations of unilateral and bilateral advance pricing arrangements, MAP proceedings, and in numerous tax audits concerning transfer pricing issues.”

According to CMS, “Bartlomiej is also experienced in profit allocation to permanent establishments, analyses of intangible transactions and supporting their business substance. In his professional career, he has supported clients from various sectors, including automotive, FMCG, finance, electronics and pharmaceuticals.”

“At CMS, we have been supporting clients in the field of transfer pricing for a long time, and now with the strengthening of the practice, we would like to offer our clients a dedicated team of fully specialized experts,” said CMS Partner Andrzej Posniak, who manages CMS’s tax practice in Poland and across CEE. “Advising on transfer pricing is another element – after strengthening our offer in the area of tax proceedings and M&A transactions – of our strategy to develop tax services in Poland and in the region.”

CMS reports that other recent additions to the team include Radoslaw Byczyk, who has provided advisory services on transfer pricing to clients for almost eight years, Paulina Karpinska-Huzior, a tax advisor and advocate responsible for supporting clients in tax and penal tax proceedings, and Malgorzata Sajkiewicz, an advocate specializing in tax aspects of M&A transactions. 

Adam Kowalczyk, the former Head of Litigation at PwC Legal in Warsaw, has joined Bird & Bird as Partner, bringing with him former PWC Legal Senior Associate Grzegorz Jan Kostrzewa and Associate Katarzyna Czech.

According to Bird & Bird, ”Kowalczyk advises clients on heavyweight commercial and regulatory disputes, compliance, and investigations, and he has considerable experience in international arbitration proceedings.” He joins Bird & Bird’s Dispute Resolution team in Warsaw, and will work closely with the firm’s Financial Services and Automotive sector groups.

Kowalczyk graduated from the Jagiellonian University in Krakow in 2008 and immediately joined DLA Piper. After several years there he moved to Weil, Gotshal & Manges, where he worked for six years, before joining PwC Legal in 2016.

Slawomir Szepietowski, Managing Partner of Bird & Bird, said: “Enlarging our Dispute Resolution team with experienced specialists, particularly in the area of regulatory disputes, is a natural way to boost our regulatory capabilities and demonstrate our success in the field of disputes. I am very pleased to welcome Adam and his team to Bird & Bird. Their knowledge and vast experience will bring real value to our clients.”

Peter Knight, Head of the International Dispute Resolution practice at Bird & Bird, added: “I’m delighted to welcome Adam – an extremely experienced practitioner – to the firm.  Adam strengthens our compliance and investigations team and will be central to our enhanced disputes practice in Central and Eastern Europe.”