The NextGenerationEU (“NGEU”) is the largest yet package of economic stimulus measures launched by the EU to boost the recovery of European economies after the COVID-19 pandemic.

The Recovery and Resilience Facility (“RRF”) is the key instrument at the heart of the NGEU to help EU Member States become stronger in the wake of the crisis by mitigating the economic and social impact of COVID-19 .

The RRF involves a total of 750 billion euros – 390 billion euros in grants and 360 billion euros in loans – of which Poland expects to receive almost 24 billion euros in grants and over 34 billion euros in loans. If things go according to expectations, Poland will be the fourth largest RRF beneficiary (after Spain, Italy, and France).

The Council has not yet approved the Polish recovery and resilience plan (the “Recovery Plan”); it is currently being assessed by the Commission.

OUTLINE OF THE POLISH RECOVERY PLAN

The Recovery Plan contains a set of reforms and public investment projects Poland intends to implement with RRF support. The achievement of goals under the Recovery Plan is foreseen until 2026.

The Recovery Plan is structured around five economic pillars: (i) resilience and competitiveness of the economy, (ii) green energy and a reduction in energy intensity, (iii) digital transformation, (iv) effectiveness, accessibility, and quality of the health system, and (v) green and intelligent mobility.

The Recovery Plan foresees investment projects for the implementation of innovative and digital solutions, a structural transformation of key areas of the Polish economy aimed at reducing the consumption of natural resources and introducing environmental innovations. The document envisages a strengthening of the science sector through improvements in science and innovation transfers to the economy.

In addition, the Recovery Plan includes measures to improve air quality and energy efficiency in buildings, to develop renewable energy sources, zero-emissions transport, smart mobility, and broadband internet access. It also aims to improve the quality and accessibility of health care services through investments in the development and modernisation of medical infrastructure in Poland.

Funds will be allocated to investments in innovation, electro-mobility, green technology, and digital applications and services.

The intended distribution of funds seems to be in line with the European Regulation’s minimum requirement that at least 37% should be allocated to environmental protection and 20% to the digital transition (up to 37.7% and 20.9%, respectively).

PRACTICAL ASPECTS

  • Approval pending The Commission was supposed to assess the Recovery Plan within two months after its submission by a Member State. Nevertheless, the Commission continues its assessment of the Polish Recovery Plan. The Polish government currently expects to have the Recovery Plan approved by the end of September. It is however hard to predict whether the Commission will accept the Recovery Plan this month.
  • How to access funds? Since the Recovery Plan is awaiting approval, there is no legislation (or available draft) on eligibility for funds or the implementation of the projects set out in the plan. The Recovery Plan provides general information that the distribution of funds will depend on the specific types of projects or investments. Also, some funds will be reserved for entities belonging to certain sectors. For instance, 60% of the funds allocated to diversification of a company’s scope of business activity or for the recovery of investments in sectors affected by the Covid-19 pandemic will be reserved for companies from the HoReCa sector. Additionally, there will be funds allocated to specific sectors, such as funds for investments to diversify and shorten the supply chain of agricultural and food products, which will be addressed to entities from the food sector (including agri-food and food processing entities). The selection of projects will be made based on criteria related to environmental protection, digitalization, job creation, and the unemployment rate. Funds will be available for micro, small and medium-sized entrepreneurs, meaning that large entrepreneurs will be excluded. On the other hand, certain funds allocated to increasing the level of digitalisation and robotisation and to supporting innovative solutions will be available for large entrepreneurs only. Projects will be selected through a competitive procedure, but also based on more arbitrary criteria.

Where certain measures constitute state aid, the projects and programmes provided in the Recovery Plan will be notified to the Commission unless the State aid block-exemption regulation applies.

The Polish government has opened a special website dedicated to the Recovery Plan, where it publishes updates and further information. Please see here.