The year 2018 was dominated by implementation of the GDPR in Europe. The new legislation governing personal data protection marked a significant change for corporate management systems. KSP provided advice in respect of dozens of projects involving the implementation of the new procedures for companies and enterprises in the energy, automotive, machine, steel, production, waste management, IT, FCMG, paper and furniture sectors, including to stock-exchange listed enterprises.
The major idea behind the GDPR is to prepare enterprise for informed management of the entire personal data protection process. In the last quarter of 2018, our Data Protection Team carried out a number of risk analyses (formally known as Data Protection Impact Assessments - DPIA), employing methods developed internally by our law firm. The DPIA was performed for the processes of surveillance of employees’ behaviour using advanced Zscaler Inc. tools, whistleblowing procedures, website user profiling for marketing purposes, etc.
KSP provided advice to an American corporation - a leader of industrial automation, regarding conclusion of a long-term lease of a BTS facility in Katowice.
Our advisors handled the issues of transaction structuring and prepared the due diligence report for the real property, while also providing advice on environmental aspects. The tax team advised on how to obtain support for the new project (tax exemption) and produced a legal opinion concerning a regulation prepared by the Polish Government on support for new investment projects, and its potential impact on the planned project. KSP also established cooperation with local governments to determine the issues of municipal infrastructure development on the site and in the proximity of the planned project. The overall value of the project is approx. EUR 16 million.
For our clients, we have developed tax documentation (local file) for selected types of transactions, e.g.:
- audit and certification services,
- research and development services,
- financial services,
- advisory and management services,
- transport services,
- waste storage services,
- real property rental and vehicle lease services,
- staff hiring services,
- licensing services,
- services in the scope of trade in raw materials and commodities.
We have conducted several dozen comparative analyses, including benchmarking analyses, and the so-called conformity descriptions. We have used data provided by our Clients, as well as data from annual accounts of companies operating in the relevant sectors. Our analyses allowed us to confirm the market level of prices used by the Clients in transactions with associated companies.
We advised our client (a Polish capital group) on a transaction to gain a financial partner for a joint investment concerning the acquisition of holdings in a leading manufacturer of steel elements, and for further restructuring of that company.
The transaction combined equity financing and debt financing and covered the sale of a block of shares in an SPV to the investor, and the issue of bonds by the SPV. The payment of the investor’s bond claims and the client’s claims was subordinated to all other claims of the SPV. The SPV received financing at the level of PLN 25 million from the investor.
KSP tax advisers have analysed the possibilities to use excise tax exemption for coal products used for heat production in coal-fired boiler houses operated by heat and power production companies.
This issue required a multi-dimensional analysis of the conditions on which energy-intensive businesses can obtain an exemption for coal products, with a prior determination of the status of coal-fired boiler houses as an organised part of an enterprise. At the same time, it was necessary to take into account the amendment of the excise law which clearly states how to understand the implementation of a system leading to the achievement of objectives in the area of environmental protection or improved energy efficiency, e.g. by obtaining and cancelling energy performance certificates.
KSP lawyers represented an entrepreneur in proceedings for payment of liquidated damages of PLN 500.000 due to withdrawal from a contract. The Court admitted all our arguments supporting the lack of grounds for imposition of the liquidated damages and shared our interpretation of the contract. The Court held that no liquidated damages were payable under a subcontract if the withdrawal occurred before commencement of the main contract. This led to dismissal of the entire claim for payment of PLN 500,000 and adjudication of all costs of the proceedings in favour of out client. The judgment has become final.
KSP lawyers participated in a restructuring process which ended with a final court-approved arrangement. The restructuring was among the first proceedings in the region of Silesia applying to a part of debt only, and consisting of conversion of the debt to shares of the restructured enterprise. The value of the debt-to-equity conversion exceeded 125 million zlotys.
Our clients can benefit from our training sessions concerning regulations “sealing up” the CIT and VAT systems, which have already become effective or are going to take effect in 2018. The purpose of the training is to present the changes and their impact on business, and to enable taxpayers to get ready for them. As an example, implementation of the split payment mechanism in VAT, which is supposed to be voluntary, may require adjustment of financial and bookkeeping systems from all VAT payers. On the other hand, the innovation package offers new possibilities to use the R&D exemption, which has so far been available for selected taxpayers only. During the training sessions we discuss practical consequences of the changes using real life examples.