Annual Report on Exchange Arrangements and Exchange Restrictions, 2007
Chapter

POLAND

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
October 2007
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(Position as of December 31, 2006)

Status under IMF Articles of Agreement
Article VIIIDate of acceptance: June 1, 1995.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2006.
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51)In accordance with UN Security Council resolutions, Poland imposed and maintains a ban on trade with Iraq, and on exports of certain products to Libya. The Polish government bans, in accordance with relevant UN Security Council resolutions, exports of arms and military equipment to the following countries: Angola (for UNITA forces), Haiti, Iraq, Liberia, Libya, Rwanda, and Somalia.
Other security restrictionsYes.
References to legal instruments and hyperlinksn.a.
Exchange Arrangement
CurrencyThe currency of Poland is the Polish zloty.
Exchange rate structureUnitary.
Classification
Independently floatingThe exchange rate of the zloty is determined on the basis of supply and demand in the foreign exchange market, and the zloty is traded freely against all currencies.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketA liquid swap market exists.
References to legal instruments and hyperlinksn.a.
Arrangements for Payments and Receipts
Prescription of currency requirements
Use of foreign exchange among residentsSettlements in foreign currency among residents in Poland require a foreign exchange permit, except for those that are (1) not related to the conduct of business activities between natural persons, (2) related to sales of goods or property rights abroad, (3) conducted between employers and employees regarding business trips or work abroad, (4) related to consumer sales, and (5) settlements in euros within the scope of expending EU funds.
Payments arrangements
Bilateral payments arrangements
InoperativeThere are agreements with Iraq, the Syrian Arab Republic, Tunisia, and Turkey. Outstanding balances are being settled in accordance with the terms of the agreements.
Regional arrangementsPoland is a member of the EU.
Clearing agreementsThere are inoperative agreements with members of the former CMEA.
Administration of controlThe authority to make basic changes in the Foreign Exchange Law rests with parliament. Regulations are promulgated by the MOF, in cooperation with the president of the National Bank of Poland (NBP). General foreign exchange permits are granted by the MOF in the form of regulations, whereas individual permits are granted by the NBP as administrative decisions. Decisions concerning individual foreign exchange permits are subject to appeal to the Supreme Administrative Court. The NBP exercises control over foreign exchange permits, exchange office activities, and submission by commercial banks and other residents to the NBP of their banking statistics for the purpose of compiling balance of payments data and the external assets and liabilities position of the country.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)
On domestic ownership and/or tradeResident individuals may hold gold in any form; trading in gold, other than in jewelry form, is subject to permission from the NBP.
On external tradeThe exportation of foreign gold coins requires a permit, except for exports by nonresidents who had previously imported them into the country and imports by residents for conducting business in precious metals. However, the exportation of gold coins issued by the NBP is permitted. Coins made from precious metals are not legal tender in Poland.
Controls on exports and imports of banknotesThe EU regulations relating to anti–money laundering apply.
On exportsThe exportation of foreign or domestic banknotes with a total value exceeding the equivalent of €10,000 requires permission, with the following exceptions: (1) exportation by nonresidents of banknotes previously imported into the country or banknotes purchased or exchanged at a bank for banknotes previously imported into the country, (2) exportation by residents and nonresidents of banknotes withdrawn from a bank account or purchased from a bank for banknotes in a bank account, (3) exportation by nonresidents of traveler’s checks signed by them and previously imported into Poland, and (4) exportation on the basis of a written declaration.
Domestic currencyYes.
Foreign currencyYes.
On importsImports of domestic or foreign banknotes exceeding the equivalent of €10,000 must be reported to the customs administration authorities.
Domestic currencyResidents and nonresidents may import up to the equivalent of €10,000 in any currency without notification to the customs authorities. There are no limitations on nonresident exports of foreign securities or traveler’s checks that had previously been imported by them into Poland; such imports are exempt from customs notifications.
References to legal instruments and hyperlinksn.a.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadResidents (individuals and enterprises) are allowed to maintain accounts in member countries of the EU, EEA, and OECD without permission. Accounts in other countries may be maintained in connection with the economic activity conducted in these countries or in connection with management of portfolio investments by residents in these countries. Activity in these accounts must be reported quarterly to the NBP. Controls apply to deposits held with nonresident financial institutions by an insurance company if these assets are to form more than 5% of the cover of its technical reserves, or by a privately managed occupational pension fund.
Approval requiredYes.
Accounts in domestic currency held abroadThe regulations for foreign exchange accounts held abroad also apply to these accounts.
Accounts in domestic currency convertible into foreign currencyNo.
References to legal instruments and hyperlinksn.a.
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsThese accounts may or may not pay interest, depending on the agreement with the bank, and they may be credited with funds from any source that is in compliance with foreign exchange regulations.
Convertible into foreign currencyThese accounts may be converted into foreign currency.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for importsNo.
Import licenses and other nontariff measuresThese transactions are subject to EU regulations.
Negative listAsbestos and articles containing asbestos, some ozone-depleting substances, and some dangerous chemicals are prohibited.
Licenses with quotasEU regulations apply.
Import taxes and/or tariffsThe EU Common Customs Tariff applies.
State import monopolyNo.
References to legal instruments and hyperlinksn.a.
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesLicenses are required for exports carried out within the framework of international agreements that stipulate bilateral settlements and for temporary exports of capital goods and transport equipment for leasing motor vehicles.
Without quotasLicenses are required for exports of radioactive materials and strategic goods (i.e., dual-use and military products), as well as of goods subject to export quotas. Exports of specific species of live poultry and of ozone-depleting goods are prohibited as are exports to the Republic of Montenegro and the Republic of Serbia of petroleum oils and oils obtained from bituminous minerals.
With quotasExports of waste and scrap of copper, nickel, aluminum, lead, zinc, and tin are subject to quota restrictions.
Export taxesNo.
References to legal instruments and hyperlinksn.a.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersFor payments exceeding €10,000 or its equivalent, all current operations must be effected through banks licensed to operate domestically. Residents and nonresidents must document payments or transfers to banks if these exceed €10,000.
Credit card use abroadCredit card use abroad is permitted, but the transactions must comply with regulations.
References to legal instruments and hyperlinksn.a.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a.
Capital Transactions
Controls on capital transactionsYes.
Repatriation requirementsNo.
Controls on capital and money market instruments
On capital market securities
Shares or other securities of a participating nature
Purchase locally by nonresidentsControls apply to the purchase of shares and other securities of a participating nature, which may be affected by regulations on foreign direct investments. Information must be provided to the Securities and Exchange Commission (SEC) if certain thresholds in voting power or stock purchase are exceeded.
Sale or issue locally by nonresidentsAn SEC permit is required for residents and nonresidents to trade in securities. Under the EU uniform passport rule, notification of the SEC is required in the case of emission prospectus approval.
Purchase abroad by residentsControls apply to the purchase of securities issued by nonresidents (1) from third countries (other than EU, EEA, and OECD countries) with which Poland has not entered into agreements for the promotion and protection of investments; and (2) if these assets are to form more than 5% of the cover of the technical reserves of an insurance company, or of the assets representative of the liabilities of a privately managed occupational pension fund.
Sale or issue abroad by residentsThese transactions require the consent of the Polish SEC. Under the EU uniform passport rule, notification of the SEC is required in the case of emission prospectus approval.
Bonds or other debt securitiesThe regulations governing shares or other securities of a participating nature apply.
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsControls apply to mortgage debt securities.
Purchase abroad by residentsControls apply to the purchase of securities issued by nonresidents if these assets are to form more than 5% of the cover of the technical reserves of an insurance company, or of the assets representative of the liabilities of a privately managed occupational pension fund.
Sale or issue abroad by residentsYes.
On money market instruments
Purchase locally by nonresidentsNo controls apply to securities traded on a recognized market.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsControls apply to the purchase of securities issued by nonresidents if these assets are to form more than 5% of the cover of the technical reserves of an insurance company, or of the assets representative of the liabilities of a privately managed occupational pension fund.
On collective investment securities
Sale or issue locally by nonresidentsPermission of the Polish SEC is required; however, in the case of UCITS, only the notification requirement applies.
Purchase abroad by residentsControls apply to the purchase of securities issued by nonresidents (1) if these assets are to form more than 5% of the cover of the technical reserves of an insurance company, or of the assets representative of the liabilities of a privately managed occupational pension fund; and (2) in countries other than members of the EU, EEA, or OECD with which Poland has not entered into agreements on the promotion and protection of investments.
Controls on derivatives and other instrumentsAll transactions require NBP approval.
Purchase locally by nonresidentsDerivatives quoted on a recognized market may be purchased without permission.
Sale or issue locally by nonresidentsThe consent of the Polish SEC is required for both residents and nonresidents to sell or issue securities.
Purchase abroad by residentsControls apply to operations in instruments and claims on a foreign market if the assets in question are to form more than 5% of the cover of the technical reserves of an insurance company, or of the assets representative of the liabilities of a privately managed occupational pension fund.
Sale or issue abroad by residentsYes.
Controls on credit operations
Financial credits
By residents to nonresidentsControls apply to credits and loans granted by an insurance company if these assets are to form more than 5% of the cover of its technical reserves, or by a privately managed occupational pension fund. NBP approval is required when the repayment date on more than half the debt is within one year, except for loans granted between immediate family members. No controls apply to credits granted by domestic banks, or with EU, EEA, or OECD countries.
To residents from nonresidentsNBP approval is required when the repayment date on over half the debt is within one year, except for loans granted between immediate family members. No controls apply to credits granted by domestic banks, or with EU, EEA, or OECD countries.
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsAn NBP permit is required for residents to establish a security in favor of nonresidents from third countries with respect to receivables due from other nonresidents. No controls apply to receivables arising from transactions among nonresidents conducted domestically.
Controls on direct investment
Outward direct investmentAn NBP permit is required for direct investments, with the exception of the purchase of shares and interests in companies based in Bilateral Investment Treaty countries. No controls apply to investments in EU, EEA, or OECD countries.
Inward direct investmentControls apply to (1) the provision of asset management services by branches of nonresident investors to domestic pension funds; (2) the acquisition of land reserved for agriculture or forests, and acquisition of water areas, unless authorization is granted; (3) investment in an enterprise operating an airline exceeding 49% of the share capital; (4) investment in a broadcasting company bringing foreign ownership of the share capital above 33%; (5) investment in an enterprise operating in the gambling and betting sector, except through an enterprise incorporated in Poland in which foreign ownership of the capital is 49% or less; and (6) investment in a registered vessel, except through an enterprise incorporated in Poland. In addition, (7) mortgage banks are not authorized to open cross-border branches; the single EU passport principle does not apply to them. A bank may open a branch in Poland, however, if it does not have the ability to issue mortgage bonds on the territory of the host country.
Controls on liquidation of direct investmentNo.
Controls on real estate transactions
Purchase abroad by residentsControls apply to the acquisition of real estate abroad by an insurance company. In addition, an NBP permit is required for real estate transactions exceeding the equivalent of €50,000, when a natural person residing in Poland purchases real estate located in a third country for personal use. In addition, an exchange permit is required for the transfer abroad of foreign currency used for the purchase of such real estate.
Purchase locally by nonresidentsNonresidents may acquire real estate or other immovable property in Poland only with permission from the Ministry of the Interior, except if it is inherited. Under the Law on Acquisition of Real Estate by Foreigners, foreigners may also acquire real estate without a permit if (1) it is an apartment; (2) they have lived in Poland for at least five years after obtaining a permanent residence visa; (3) they have been married to a Polish citizen for at least two years (the purchased real estate must constitute part of matrimonial community property); or (4) real estate is purchased by nonresident juridical persons for statutory purposes, and the size of the real estate does not exceed 4,000 square meters in urban areas. The Council of Ministers may issue a regulation defining other cases for which a permit is not required, provided the size of acquired real estate does not exceed 4,000 square meters in urban and 10,000 square meters in rural areas. The Council of Ministers may also extend the area to be acquired without permit to 12,000 square meters in urban and 30,000 square meters in rural areas. Poland maintains until 2009 rules regarding the acquisition of secondary residences by foreigners other than nationals of EU member states and nationals of states that are parties to the EEA and who have been legally residents of Poland for four years continuously. In addition, rules regarding the acquisition of agricultural land and forests are in force until 2016. Under these rules, nationals of another member state or of a state that is party to the EEA who want to establish themselves as self-employed farmers and who have been legally resident and leasing land in Poland as a natural or legal person for at least three years continuously are not subject to any procedures other than those that apply to nationals of Poland; in some western and northern “voivods” (state administrations), the residence and leasing period is for a minimum of seven years.
Sale locally by nonresidentsYes.
Controls on personal capital transactions
LoansThere are no controls on family loans.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsNBP approval is required for gifts exceeding the equivalent of €10,000.
Settlements of debts abroad by immigrantsYes.
Transfer of gambling and prize earningsYes.
References to legal instruments and hyperlinksn.a.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Lending to nonresidents (financial or commercial credits)Banks are allowed to extend to nonresidents financial or commercial loans or purchase securities abroad up to a certain limit (e.g., large exposures) based on regulations of the Commission for Banking Supervision, implementing prudential regulations in force in the EU.
Open foreign exchange position limitsBanks’ overall foreign exchange position (including position in gold) is defined and regulated in accordance with the Basel II Accord, so the relevant Polish regulations implement CRD regulations provided for in the 2006/48/EC and 2006/49/EC directives.
Provisions specific to institutional investors
Insurance companiesIn compliance with EU directives, a permit from the Insurance and Pension Funds Supervisory Commission is required for non-EU entities to commence an insurance business; for EU-located insurance entities, the general provisions of EU law apply. The commission is to be informed about investment transactions that would result in the acquisition of 10% of voting power, or in the increase of voting power beyond 20%, 33%, or 50% of total voting power. The commission has the right to reject the transaction within a three-month period. Prudential regulations establishing limits for the investment of insurance funds in the country and abroad are provided by the statute on insurance operating activity.
Limits (max.) on securities issued by nonresidentsThe limit for insurance business is 5% if denominated in foreign currency or 12% if denominated in euros, except for risks situated abroad, to which technical provisions in the respective currency apply. Controls apply to the purchase of securities issued by nonresidents if these assets are to form more than 5% of the cover of the technical reserves of an insurance company. Foreign assets (outside the EU) denominated in one currency and the total value of these assets may not exceed 5% and 10% of the cover of the technical reserves of an insurance company, respectively.
Limits (max.) on investment portfolio held abroadThe regulations governing limits on securities issued by nonresidents apply. In addition, controls apply to (1) the acquisition of real estate abroad, (2) operations in derivative instruments and claims on a foreign market, (3) credits and loans granted, and (4) deposits held with nonresident financial institutions by an insurance company if these assets are to form more than 5% of the cover of its technical reserves.
Limits (min.) on investment portfolio held locallyThe limit for insurance businesses is 99%.
Currency-matching regulations on assets/liabilities compositionThe currency-matching rule does not apply if assets denominated in one currency constitute less than 7% of assets denominated in all other currencies. It also does not apply if no more than 20% of assets denominated in a given currency do not meet certain specific requirements set by Polish law. The total assets denominated in all currencies must be at least equal to the total liabilities.
Pension funds
Limits (max.) on securities issued by nonresidentsOpen pension funds and occupational pension funds are allowed to invest not more than 5% of their assets abroad, and such investments may be only in OECD countries or in countries with which Poland has entered into agreements on the promotion and protection of investments. Further, these investments may be only in (1) securities issued by companies listed on major stock exchanges; (2) securities issued by treasuries or CBs; and (3) mutual fund certificates, provided they are redeemable on demand and issued by entities domiciled in one of the aforementioned countries.
Limits (max.) on investment portfolio held abroadThe regulations governing limits on securities issued by nonresidents apply. In addition, controls apply to (1) operations in derivative instruments and claims on a foreign market, (2) credit and loans granted, and (3) deposits held with nonresident financial institutions by a privately managed occupational pension fund if the assets in question are to form more than 5% of the assets representative of the liabilities of a privately managed occupational pension fund.
Limits (min.) on investment portfolio held locallyThe limit for pension funds is 95%.
Currency-matching regulations on assets/liabilities compositionn.a.
Investment firms and collective investment fundsn.a.
References to legal instruments and hyperlinksRegulations Nos. 2006/48/EC and 2006/49/EC.
Changes during 2006
No significant changes occurred in the exchange and trade system.

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