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The Buzz in Poland: Interview with Karolina Stawowska of Wolf Theiss

The Buzz in Poland: Interview with Karolina Stawowska of Wolf Theiss

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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.”

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With over 360 lawyers in 13 countries, over 80% of the firm’s work involves cross-border representation of international clients. We have concentrated our energies on a unique part of the world: the complex, fast-developing markets of the CEE/SEE region. Through our international network of offices, we work closely with our clients to develop innovate solutions that integrate legal, financial, and business know-how.

Wolf Theiss provides fully integrated corporate services in mergers and acquisitions, private equity, real estate, banking and finance, tax and insurance, employment law, competition law, energy law, privatisation, restructuring, public procurement and litigation. At Wolf Theiss, we measure our success by the success of our clients. We align our goals with yours to ensure that your needs are being met in even the most complex of cross-border matters. This means that we know how to listen to you and help you use the assets you already have while finding opportunities.

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