The Government Legislation Center published on its website draft regulations on the introduction of a new system of investment support in Poland, including a key regulation on state aid to business. Among other things, the regulation sorts out the critical issue of how to calculate the minimum expenditure required to qualify for a support decision.

As we told you in an earlier alert the current Special Economic Zones system is to be terminated and replaced—starting 2018—with the possibility of obtaining a decision on support for a new investment qualifying for income tax exemption wherever you are in Poland.

A bill setting out the new measures was published in October, which presented only a general outline of the new principles of investment support, leaving many basic issues to be fleshed out in executive regulations.

Under the draft regulation on state aid, to qualify for support large enterprises will have to comply with the following minimum eligible costs of investments, depending on the unemployment rate in the relevant county (powiat):

Unemployment rate relative to the average national unemployment rate Minimum eligible costs of an investment by a large enterprise (PLN millions)
60% of the average rate or less 100
60% - 100% of the average rate 80
100% - 130% of the average rate 60
130% - 160% of the average rate 40
160% - 200% of the average rate 20
200% - 250% of the average rate 15
> 250% of the average rate 10

The above thresholds will not apply to investments in modern business services, or to investments by micro-enterprises or small and medium-sized enterprises, for which the threshold of minimum eligible costs will be reduced by 98% (micro-enterprises), by 95% (small enterprises) or by 80% (medium-sized enterprises).

The draft regulation also sets out in detail how to determine the duration of the period of support, how to calculate points in the qualitative evaluation of an application for support, or how to determine the maximum aid intensity (which differs significantly from the current one). The regulation also provides for the obligation to calculate the ceiling for available state aid for each support decision received separately.

It will certainly be more difficult and complex to obtain a new permit than it is now, and the process of preparing and evaluating an application for a permit will significantly differ from the previous practice.