TENEBRIS LLC » Special Economic Zone in Poland

On 30^th of June 2018 law about Special Economic Zones (SEZ) came into life in Poland. The basic idea of this new legislation is to change the existing concept of SEZ. The previous law was designating specific areas where does zones were placed and businesses had to move there. Now everything will change, the specific areas will disappear and whole country will be SEZ.

What is it

At the moment there is only the mainframe of the law. The specific executive orders of the local communities and more detailed rules of SEZ should be ready till end of July. One good thing about the new law is that it would speed decision making for granting the status of SEZ Company.

The concept of making Poland a SEZ is to allow businesses to locate their base of operations in areas that would suit them most. They would not have to relocate to place of the SEZ location like it was before. In my opinion this is very good move made by Polish government as it enables entrepreneurs to focus on business that can be sustained by local economy and work force.

Company that will be granted the SEZ Company status can be exempted from tax from 10 to 15 years. The precise regulation will be made till end of July. The government is still working on the list of businesses that could get this. Nonetheless everyone is entitled to become SEZ Company.

Another important thing would be the rules and conditions that business have to fulfil in order to get this status. The new law makes all entrepreneurs equal not matter form which country they will came. Of course specific regulations for opening a business by foreigners will apply (if new company). In case of existing businesses that will like to expand/move business to Poland normal investment procedures apply.

This approach makes investing in Poland easier as there are no extra conditions or disadvantages of being foreign entrepreneur/business.

Who can apply for SEZ Company status

There is not boundaries as to who can apply for the status. New law indicates that all business sizes are eligible for application. This move in my view was good as it allows people with good ideas to benefit from this system.

Of course the system is created in the such way that it will give extra points for certain types of businesses.

The main concern is putted on Micro, Small and Medium size businesses/companies. Thanks to that Polish government wants to promote those who are starting their business careers, as well as those who want to grow them. Furthermore extra consideration will be given to business that will promote competitiveness and innovation in local economies (cities, counties etc.). This approach is more than welcome as it would allow business to use local economies of scale.

Another aspect that will grand extra points is the type of business. Polish government does not hide his intentions of making Poland blue chip and innovation hub in Central and Eastern part of Europe. AS such business that would like to start or relocate their Research & Development to Poland would get extra credit. Also innovative business will be looked be keen eye.

Working with Polish Universities would be another way to get ahead of competition in getting SEZ Company badge. In this case the idea is to prepare young people for their future jobs and to educated skilled work force. This goes along with co-working with innovation, businesses and technological hubs.

Locating your business in high unemployed areas would be also seen as an advantage which could lead to extra mark. Reason for that is to develop and 'regenerate' all of Poland not only few cities.

Is it for me?

Starting business in different country is always difficult and even frightening decision. I know this from personal experience. There was no single day when I was thinking did I made a good choice. However I was raised in that there are no bad decisions, there are only a little weaker ones. Nonetheless you should think carefully before starting business in other country. Check what should be done, possibilities of international growth etc.

Personally I am a big fan I risking as this is the nature of starting business. The only thing that you can do is to minimize the risk.

The new law makes Poland very attractive place to invest, not only because of SEZ but also thanks to great work force and taxes (CIT is 19%, as from 2020 there is new CIT for small companies which is 9%)