Poland Market Entry

Subchapters:

• Market entry
• Forms and conditions of operation on the market
• Marketing and Communications
• Issues of intellectual property protection
• Public procurement market
• Payment terms, payment ethics and resolution of commercial disputes
• Visas, fees, specific conditions of travel to the territory
• Employment of citizens from the Czech Republic
• Fairs and events

Market entry

Like the Czech Republic, Poland has been a member of the EU since 2004. Both countries are therefore part of the European Single Market, where the free movement of goods, people, services and capital applies. Both countries are also part of the Schengen area. Thus, neither tariff nor non-tariff barriers are applied in mutual trade. However, sales on the Polish market are subject to value added tax and, in some cases, consumption tax (including alcohol, cigarettes, motor oils and passenger cars). However, the absence of formal barriers to trade is connected to the fact that entering the saturated Polish market means facing a lot of competition. Check smber for agriculture and fishing facts of Poland.

Before entering the Polish market, every exporter must make sure that they offer a product or service that has a chance of success due to its quality, availability or uniqueness. Although it is a close country (geographically, culturally and linguistically), which is a natural destination for Czech exporters and investors, entering Poland entails many difficulties. It is therefore necessary to familiarize yourself with the conditions on the local market in advance, to prepare a detailed marketing plan and, in many cases, to establish the necessary partnerships with local entities.

Every Polish company has the opportunity to conduct foreign trade, both with its own goods and with goods of other manufacturers (with the exception of some types of goods of a special nature for which a license is required, typically weapons). The purchase of products of Czech companies is carried out directly by customers – mainly for goods of an investment nature (machine tools, investment units, etc.) or by taking them to large warehouses (mainly goods of a consumer nature, food, alcohol, etc.). In some cases, it is possible to place goods in customs warehouses. The retail network is rapidly becoming concentrated under the influence of large retail chains, and it is very difficult to enter the market without entering supermarkets and hypermarkets.

Recently, networks of Polish retail and wholesale stores have been created, but similar rules apply to foreign chains (registration fees, etc.). Polish importers do not like to do business through trading companies, intermediaries, etc., they almost always look for contacts directly with the manufacturer. Foreign suppliers who want to maintain control over the sales network conclude contracts with local wholesalers, provide them with loans or work on the basis of exclusivity of individual regional distributors.

Finding a good and reliable business partner is very difficult and requires personal contacts. It is best to use the experience of representatives and offices of Czech companies based in Poland. The first contacts can also be obtained through the economic section of the Trade Union in Warsaw, the PaulTrade office and honorary consulates in Czestochowa, Bydgoszcz, Wrocław, Łódź, Poznań and Szczecin, which will provide lists of Polish import and production companies or warehouses.

Food imported from abroad for the purpose of their direct introduction into circulation or treatment is subject to inspection by the State Hygienic Inspection, in the case of products of animal origin, to inspection by the Ministry of Agriculture and Nutrition of Poland (in practice, the assessment is mainly issued by voivodship hygienic-epidemiological stations). Dietary foods and food supplements may only be imported with the permission of the chief hygienist.

Certification of products and quality systems is carried out by authorized certification bodies. The product certification system includes mandatory and voluntary certification. Mandatory certification is carried out with regard to the safety symbol “B”, which should be used to mark domestic and imported products that could threaten life, health, and the natural environment. The list of products with mandatory certification is published in the official gazette. In a bilateral relationship, the certification procedure is greatly facilitated by the agreement between the Czech Republic and PL.

Consumers generally prefer good quality products that are reliable and performant, in many cases with easier operation and maintenance. An important factor is the guarantee of delivery of spare parts, provision of service and training of Polish workers. Czech products are also often used due to their price competitiveness. On the other hand, self-promotion still lags behind.

Forms and conditions of operation on the market

After Poland’s accession to the EU, the most important legal norm in this area is the Act of March 6, 2018 entitled “Business Act”. Foreign persons from EU member states can carry out economic activity on the same principles as Polish entrepreneurs. Foreign persons mean:

• i/ natural persons residing abroad who do not have Polish citizenship;
• ii/ legal entities based abroad;
• iii/ organizational units that are not legal entities, but have the capacity to perform legal acts, based abroad.

Foreign entrepreneurs can carry out company activities in the field of foreign trade, transport, culture and tourism in the form of branches and representative offices. The condition is obtaining the approval of the relevant minister. The permit is issued on the basis of the Act “On the Rules of Participation of Foreign Entrepreneurs and Other Foreign Persons in Economic Activities in the Republic of Poland”, which also contains the conditions of activity.

Foreign persons can establish in Poland:

• i/ limited liability companies (PLN 50,000);
• ii/ joint stock companies (PLN 500,000);
• iii/ limited partnerships;
• iv/ limited liability companies.

Foreign companies mainly use the form of a company with limited liability rather than a joint-stock company. This is due to tax benefits, simplicity in incorporation, lower liability and lower reporting obligations.

Representative offices, in accordance with the law, can only advertise and promote their company. The agency does not have legal personality, but must respect Polish tax, accounting, foreign exchange and other regulations. Due to the change in legislation, the establishment of a trading company now appears to be the most advantageous.

The deposit of a foreign entrepreneur can be in foreign currency, supplies of machinery and equipment. It must come from foreign sources or income from shares owned in Poland, or from stocks. Profits can be freely transferred abroad. In addition to the Labor Code and the Environmental Protection Act, the provisions of the Foreign Exchange Act and the Customs Act are also important for companies with foreign participation.

Concessions are required only for certain types of economic activity (founding a bank, arms trade, etc.). The first step is the signing of the company agreement in the form of a notarial deed and registration at the economic registration court of the relevant voivodeship. After obtaining the statistical number, it is necessary to register the company with the social security office, open a bank account with the selected bank and register the company with the tax office. More detailed information on the company registration process is available in English on the relevant government portal Biznes.

The conclusion of agency contracts and business contracts is governed by the provisions of the Civil Code.

Marketing and communication

Before entering the Polish market, it is expedient to first familiarize yourself with the economic, social and political situation in the country, conduct market research if necessary and find suitable partners. It is more efficient to actively contact partners than to wait for their initiative. It is appropriate to introduce the company and its intentions in the form of an informative letter and as a next step a personal meeting. It is best to present the materials in the Polish language. In case a professional translation cannot be provided, materials in English can be used. If you are serious about a wider and more permanent penetration (or cooperation on the Polish market), it is recommended to have a marketing study drawn up, or to consult with a professional institution in Poland about the situation on the market of the given commodity. This service for Czech companies is offered by the PaulTrade office in Warsaw.

A number of specialized agencies, institutes and companies in the field of market research, consulting firms, personnel consulting firms, public relations firms, advertising agencies, etc. are currently operating in Poland. Most of them are based in Warsaw, a few of them operate in Poznań, Krakow, Łódź and exceptionally in other larger cities. The vast majority are companies with foreign participation, which work according to proven foreign know-how and have nationwide scope.

The sales technique in Poland is no different from the common methods used in European countries. When selling goods of an investment nature, personal contact with the customer and a good knowledge of the technical issues of the given product are necessary. When selling consumer goods, paid advertising plays a very important role in traditional media, as well as on social networks. In view of the growing competition on the Polish market, promotion has a very important influence on the introduction of the product to the market. Participation in international fairs and exhibitions also plays an important role.

Issues of intellectual property protection

The Embassy of the Czech Republic in Warsaw is not aware of any cases of infringement of intellectual property rights in relation to Czech entities. The state of protection of intellectual property rights corresponds to the standard level in the EU and the Central European region. The following laws are related to the issue of intellectual property protection in Poland:

• i/ Constitution of the Republic of Poland (Konstytucja Rzeczypospolitej Polskiej);
• ii/ Law on copyright and related rights (Ustawa o prawie autorskim i prawach pokrewnych);
• iii/ Protection of plant varieties (Ochrona prawna odmian roślin);
• iv/ Act on Combating Unfair Competition (Ustawa o zwalczaniu nieuczciwej konkurencji);
• v/ Business Law (Prawo Przedsiębiorców);
• vi/ Customs law (Prawo celne);
• vii/ Act on Registration and Protection of Names and Designations of Agricultural Products and Food Products and on Traditional Products (Ustawa o rejestracija i ochronie nazw i oznaczeń produktuk rolnych i świetrą spożywczych oraz o produktach tradycyjnych).

Public procurement market

The awarding of public contracts in Poland is governed by the Public Procurement Act (Prawo złością publicznych). Public contracts are tendered by state authorities, voivodship and other regional authorities, municipalities, budgetary units and enterprises, state funds, communal services, cooperatives, agencies, etc., to the extent of the state resources available to them. Public tenders have a diverse form, they mainly apply unlimited public tenders in which all interested suppliers can participate. The deadline for submission of tenders must not be shorter than 6 weeks from the date of announcement.

Another frequently used form is a limited tender procedure, in which only suppliers who have been invited to submit a tender can participate. The deadline for submitting an offer here must not be shorter than 4 weeks. Foreign companies can participate in public tenders. The Public Procurement Office (Urząd Zamówień Publicznych – UZP) was established to secure the public procurement system. The Office issues a Bulletin, which is published on the UZP website, along with a number of other information related to public procurement in Poland.

Payment terms, payment ethics and resolution of commercial disputes

In relation to Poland, the normal payment terms valid in international trade are used. Payment in advance is often applied, especially for new partners. After agreement with the bank, the contract can also be concluded in national currencies. Payment morality is comparable to payment morality in the Czech Republic.

The resolution of commercial disputes is carried out as in the Czech Republic on the basis of the Commercial Code and the arbitration court, which operates at the Chamber of Commerce in Warsaw. If necessary, it is possible to contact one of the many international and Polish law firms providing services to foreign customers, a list of which is available at the OEÚ ZÚ Warsaw, PaulTrade in Warsaw or the Czech-Polish Chamber of Commerce in Ostrava.

Visas, fees, specific conditions for traveling to the territory

For citizens of the Czech Republic, a valid passport or identity card is sufficient. In case of a continuous stay of more than 90 days, there is an obligation to report the stay to the relevant police department. Poland is part of the Schengen area, the movement of goods and people across the border is free and without controls in both directions. Road, train and air transport can be used to travel to Poland. Direct air connections operate between Prague and Warsaw (Chopin Airport) and also between Ostrava and Warsaw. Both Warsaw airports (Okęcie and Modlin) are connected to the city center by public transport (buses, trains), or taxi services can be used without any problems.

As for accommodation – its availability, conditions, prices and quality of services are fully comparable to the Czech Republic.

Employment of citizens from the Czech Republic

With regard to the membership of the Czech Republic and Poland in the EU and the rule of freedom of movement of labor, the employment of citizens of the Czech Republic in Poland is not associated with any obstacles. The only condition is the notification of the employee’s stay at the relevant office and the allocation of the insured person’s number (PESEL), which is necessary for the payment of health and social insurance.

Foreigners from third countries are employed in Poland on the basis of the Act on the Promotion of Employment and Labor Market Institutions (Ustawa o promocji rynku i instytucjach rynku pracy).

Fairs and events

A large number of trade fairs and exhibition events take place in Poland. In Poznań (Poland’s main trade fair city), Kielce and 14 other trade fair centers (mainly Warsaw, Lodz, Katowice, Krakow, Wroclaw, Toruń, Gdańsk, Szczecin, Bydgoszcz) industry exhibitions and fairs are organized, as a rule, with the ever-widening participation of exhibitors from the Czech Republic. Basic information about all fairs and exhibitions in Poland can be obtained from the Internet at www.targi.com.

The most important of them for exhibitors from the Czech Republic are, for example, the construction fair BUDMA, the railway TRAKO in Gdańsk, the industrial ITM and the agricultural POLAGRA in Poznań or the professional symposium Energetyka Belchatów. Other important trade fairs include POLEKO, AUTOSTRADA POLSKA and MSPO (defense industry) in Kielce, SIBEX, SILESIA TSL EXPO, TOOLEX in Sosnowiec, EURO GASTRO, WORLDFOOD WARSAW, WIHE (medical devices) and INFRASTRUKTURA in Warsaw or ENERGETAB in Bielsko-Biala.

If the exporter wants not only to visit one of the fairs, but also to participate in it directly, we recommend contacting the PaulTrade office in Warsaw, or embassy and consult your participation and options. To participate in the fair, we recommend having all graduation materials in Polish. The architecture of the stand should be given as much attention as possible.