General context, key principles and hot topics
1 Identify the highest-profile corporate investigation under way in your country, describing and commenting on its most noteworthy aspects.
Currently the highest-profile investigations in Poland concern various financial institutions. The scope of recent cases includes bond issuers, closed-end investment funds and banks.
Owing to very low enforcement actions concerning the criminal liability of corporations, the enforcement agencies are focusing primarily on the individual criminal liability of managers.
2 Outline the legal framework for corporate liability in your country.
The liability of corporate entities for criminal offences is regulated by the Act on the Criminal Liability of Collective Entities for Punishable Offences (the Liability Act). In general, under the Liability Act, a corporate entity may be liable if an offence mentioned in the Liability Act is committed by a specific person and that person’s conduct has resulted, or may have resulted, in a benefit for the corporate entity.
The corporate entity will face liability for the actions of individuals only if its bodies or representatives have failed to exercise due diligence in preventing the commission of an offence, or if the entity has failed to exercise due diligence in hiring or supervising a person given permission to represent it. The lack of criminal liability of a corporate entity does not exclude the possibility of the corporate entity incurring civil liability for the damage caused or the administrative liability of the entity.
The maximum fine under the Liability Act is 5 million złotys (but cannot be higher than 3 per cent of the corporate entity’s revenues generated in the year in which the offence was committed).
The Liability Act is considered inefficient and is rarely applied in practice. However, in 2018, the Polish Ministry of Justice published the draft Act on the Liability of Corporate Entities for Acts Prohibited under Penalty (the Draft Liability Act), the aim of which is to change the current framework for corporate criminal liability and make it more efficient. Work on the Draft Liability Act is still at the initial stage of the legislative process. The main assumptions of the proposed Draft Liability Act are as follows: (1) the liability of the corporate entity is to be independent of any previous conviction of an individual; (2) a corporate entity may be liable for any offence; and (3) a fine of up to 30 million złotys could be imposed on a corporate entity.
3 Which law enforcement authorities regulate corporations? How is jurisdiction between the authorities allocated? Do the authorities have policies or protocols relating to the prosecution of corporations?
Jurisdiction between the law enforcement authorities (police, public prosecutors and criminal courts) depends on the subject matter and location of the offence. Higher branches of the public prosecution system have divisions devoted to corporate crimes where the prosecutors specialise in cases such as bribery and corruption, cybercrime or financial crime.
Aside from the police and public prosecutors, there are multiple specialist agencies with law enforcement powers, including:
- Internal Security Agency: the counter-intelligence agency, which focuses on issues concerning Poland’s internal security, but also organised crime, corruption and economic coercion;
- Central Bureau of Investigation: the police agency that deals with organised crime;
- Central Anticorruption Bureau: tasked with investigating bribery and corruption; and
- Customs Service.
4 What grounds must the authorities have to initiate an investigation? Is a certain threshold of suspicion necessary to trigger an investigation?
Criminal investigations may be initiated in cases where there is a justified suspicion that an offence has been committed. The relevant law enforcement agency may decide to do this on its own or based on the notification of a crime, which can be filed by anyone.
5 How can the lawfulness or scope of a notice or subpoena from an authority be challenged in your country?
According to the Polish Code of Criminal Procedure, notices or subpoenas must fulfil specific formal requirements and may be challenged if those requirements are not fulfilled. In the case of requests for documents and information, privilege or professional secrecy may be claimed.
6 Does your country make use of co-operative agreements giving immunity or leniency to individuals who assist or co-operate with authorities?
Although currently Polish law does not provide for any leniency procedure in criminal cases, the approach of the corporate entity that is subject to a criminal investigation is taken into account. In relation to individual perpetrators, the Polish Criminal Code provides for a reduction of a penalty or exclusion of liability if the perpetrator discloses information concerning the crime to the authorities prior to its discovery.
The Draft Liability Act provides that the entity will be able to admit its liability voluntarily to avoid a trial and to agree a more lenient fine with the public prosecutor. Thus, if the draft Act enters into force, there will probably be an increase in the number of internal investigations carried out by companies wishing to benefit from the leniency procedure. Currently, work on the Draft Liability Act is not moving forward.
7 What are the top priorities for your country’s law enforcement authorities?
Corruption, cybercrimes and financial crimes are currently high on the law enforcement authorities’ agenda.
8 To what extent do law enforcement authorities in your jurisdiction place importance on a corporation having an effective compliance programme? What guidance exists (in the form of official guidance, speeches or case law) on what makes an effective compliance programme?
Although Polish law does not expressly provide for a compliance defence, it may be inferred from the current Liability Act. This is because such liability is dependent on fault: either fault in selection or organisational fault. In practice, having an effective compliance programme may enable the corporate entity to argue that organisational fault cannot be attributed to it. However, the use of this defence remains untested. In turn, if the Draft Liability Act enters into force, a corporate entity may be able to avoid criminal liability for corruption committed by the individuals and bodies authorised to act on its behalf if it proves that it acted with due care and diligence in the relevant circumstances. The corporate entity will have to prove that it had mechanisms in place to ensure compliance of its activities with the law. It can be expected that, for this purpose, the corporate entity will be able to rely on having a compliance programme.
9 Does your country regulate cybersecurity? Describe the approach of local law enforcement authorities in your country to cybersecurity-related failings.
In Poland, cybersecurity is regulated by the Act on the National Cybersecurity System (the Cybersecurity Act) of 5 July 2018. It is the first law in Poland in this respect, implementing Directive (EU) 2016/1148 on security of network and information services (the NIS Directive) into the national legal system. The Cybersecurity Act came into force on 28 August 2018.
Apart from complying with all the requirements imposed by the NIS Directive (as described in the Europe Overview), the Polish legislator has extended the reach of the Cybersecurity Act by including the public administration and the telecommunications sector (to some extent) in its scope.
The Cybersecurity Act takes into account the regulations introduced by Regulation (EU) 2016/679 on the protection of individuals with regard to the processing of personal data and on the free movement of such data (the General Data Protection Regulation (GDPR)).
Cybersecurity is also regulated to some extent by the amended Act on Payment Services (the Payment Services Act), which transposes the revised Directive (EU) 2015/2366 on payment services in the internal market into Polish law.
10 Does your country regulate cybercrime? What is the approach of law enforcement authorities in your country to cybercrime?
The Polish Criminal Code covers various cybercrime offences, including, in particular, hacking, denial-of-service attacks, infection of information technology systems with malware, phishing, identity theft and identity fraud.
The law enforcement authorities frequently deal with cybercrimes, which have skyrocketed during the covid-19 pandemic. This often requires an international approach and multinational co-operation with authorities, both within and outside the European Union.
Cross-border issues and foreign authorities
11 Does local criminal law have general extraterritorial effect? To the extent that extraterritorial effect is limited to specific offences, give details.
Polish criminal law has a general extraterritorial effect and applies to Polish citizens who commit criminal offences abroad (as long as the act in question is also a criminal offence in the country in which it was committed, and with any differences between the two legal systems used in favour of the accused). As regards criminal liability of corporate entities, the current law includes international entities that conduct business activity in Poland in the definition of corporate entities that may be subject to corporate criminal liability. This is largely untested and unclear. The aim of the draft Act on the Liability of Corporate Entities for Acts Prohibited under Penalty (the Draft Liability Act) is to clarify this situation and to specify that foreign corporate entities may be held liable for a criminal offence if it was committed in Poland, or if it was committed abroad but the consequences of the offence materialise in Poland, or if the act was against the interests of Poland or a Polish citizen or legal entity. At the same time, however, the Draft Liability Act stipulates that an investigation cannot be initiated against a foreign company, so it is unclear whether the Draft Liability Act would in fact facilitate penalising foreign corporate entities under Polish criminal law.
12 Describe the principal challenges that arise in your country in cross-border investigations, and explain whether and how such challenges depend on the other countries involved.
One of the biggest challenges for the law enforcement agencies is how to effectively conduct large-scale cross-border investigations. Sometimes the lack of sufficient resources and proper forensic support makes it challenging to efficiently collect and analyse big volumes of seized data. Transnational corruption is another area in which the law enforcement agencies face challenges, as mutual assistance in criminal matters is often time-consuming.
The law enforcement agencies also encounter difficulties in gathering evidence. At present, the law does not create favourable conditions for companies to step forward and provide the authorities with documentation in exchange for leniency. Consequently, there are no sufficient grounds for co-operation (e.g., private investigations) aimed at developing better solutions for internal compliance.
In complex cybercrime investigations, the authorities are sometimes unable to identify the suspects (forming international crime groups) or to freeze stolen assets. This is because of lengthy, formal procedures that are not adapted to the developing schemes set up by cyber criminals. The situation is slightly better within the European Union, which has developed programmes for co-operation in cross-border investigations.
13 Does double jeopardy, or a similar concept, apply to prevent a corporation from facing criminal exposure in your country after it resolves charges on the same core set of facts in another? Is there anything analogous in your jurisdiction to the ‘anti-piling on’ policy as exists in the United States (the Policy on Coordination of Corporate Resolution Penalties) to prevent multiple authorities seeking to penalise companies for the same conduct?
There is neither an ‘anti-piling on’ nor a double jeopardy policy under Polish criminal law. The law makes it possible to investigate and punish the same criminal act that has been subject to a foreign criminal charge and sentence (for example, if a Polish entity that was part of a larger international conglomerate was penalised abroad for corruption, the relevant Polish law enforcement authority would aim to penalise the same entity in Poland, pursuant to Polish law). However, as regards individuals, any deprivation of liberty abroad will count towards any sentence issued in Poland.
14 Are ‘global’ settlements common in your country? What are the practical considerations?
Global settlements are not common in Poland. Currently there are also no grounds for corporate settlements in criminal cases in Poland.
15 What bearing do the decisions of foreign authorities have on an investigation of the same matter in your country?
Decisions made by foreign authorities may be taken into account by the Polish law enforcement authorities in terms of findings. However, these decisions are not binding on Polish investigations.
Economic sanctions enforcement
16 Describe your country’s sanctions programme and any recent sanctions imposed by your jurisdiction.
Poland does not have its own sanctions programme. Nevertheless, Poland is required to observe and enforce the United Nations Security Council sanctions and EU restrictive measures.
17 What is your country’s approach to sanctions enforcement? Has there been an increase in sanctions enforcement activity in recent years, for example?
We have not seen any landmark decisions relating to EU sanctions violations taken by the Polish courts or institutions. There are also no relevant cases relating to Council Regulation (EC) No. 2271/96 (the EU Blocking Regulation) and no specific blocking statue at the national level.
18 Do the authorities responsible for sanctions compliance and enforcement in your country co-operate with their counterparts in other countries for the purposes of enforcement?
Polish authorities liaise with their counterparts in other countries for the purposes of enforcement.
19 Has your country enacted any blocking legislation in relation to the sanctions measures of third countries? Describe how such legislation operates.
The EU Blocking Regulation, which is applicable in Poland:
- prohibits all individuals living in the European Union and being citizens of one of the EU Member States, and all companies having their seat in the European Union, from complying with US acts imposing sanctions on Cuba, Iran and Libya;
- provides that no judgments or decisions giving effect to the above-mentioned US acts will be recognised or enforceable in EU Member States; and
- provides for a right to seek damages for harm caused as a result of application of the above-mentioned US acts.
20 To the extent that your country has enacted any sanctions blocking legislation, how is compliance enforced by local authorities in practice?
Poland has not enacted any additional blocking legislation.
Before an internal investigation
21 How do allegations of misconduct most often come to light in companies in your country?
Allegations of misconduct most frequently come to light in companies as a result of reports by whistleblowers, internal investigations and private civil complaints (sometimes by competitors).
22 Does your country have a data protection regime?
Yes. Regulation (EU) 2016/679 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data (the General Data Protection Regulation (GDPR)) is directly applicable in Poland and regulates the vast majority of general data protection issues. Additionally, there is a Polish Data Protection Act of 10 May 2018, which regulates mostly administrative and procedural issues in respect of the Polish data protection authority (Prezes Urzędu Ochrony Danych Osobowych). Some specific issues in respect of data protection are also regulated in other legislative acts, such as the Labour Code or the Banking Law.
23 To the extent not dealt with above at question 9, how is the data protection regime enforced?
The data protection regime is enforced through mechanisms provided for in the GDPR (i.e., through inspections and the imposition of fines specified therein by the Polish data protection authority). The data protection authority uses the mechanisms provided for in the GDPR and has already imposed a number of fines for data protection breaches.
Apart from the above, breaches of data protection rules may sometimes constitute breaches of specific local acts and may lead to the imposition of sanctions provided therein. For example, sending marketing communications via electronic means or telephone without the explicit consent of the recipient is subject to fines specified in the Act on the Provision of Services via Electronic Means and in the Telecommunications Law, respectively.
24 Are there any data protection issues that cause particular concern in internal investigations in your country?
Yes, the regulation of employee monitoring may cause concern in internal investigations.
25 Does your country regulate or otherwise restrict the interception of employees’ communications? What are its features and how is the regime enforced?
Polish law regulates in detail the matter of employee monitoring. In principle, the monitoring of electronic communications of employees (and any other type of monitoring, apart from visual monitoring, which is based on slightly different criteria) may be introduced only if it is necessary to ensure the organisation of work that facilitates the full use of working time and the proper use of tools and equipment made available to employees. The scope, purposes and manner of monitoring should be agreed in a collective bargaining agreement, the work rules or (if the employer does not have a collective bargaining agreement and is not obliged to issue work rules) in a notification issued to employees. The employees must be notified about the introduction of monitoring no later than two weeks before it is put into operation.
The foregoing rules are mandatory, and the implementation of any monitoring that is not compliant with the rules is unlawful.
Dawn raids and search warrants
26 Are search warrants or dawn raids on companies a feature of law enforcement in your country? Describe any legal limitations on authorities executing search warrants or dawn raids, and what redress a company has if those limits are exceeded.
The authorities quite often use search warrants or dawn raids to seize documents or data relevant to an investigation.
The authorities should act in line with the key principles that the seizure of data or documents must be (1) purposeful (i.e., it must serve the investigation’s objectives), (2) necessary (it should be used as an ultima ratio, i.e., without the seizure, the investigation’s objectives cannot be met), and (3) proportionate (i.e., the authorities are allowed to seize only the documents and data needed for the investigation, and nothing more).
If these limitations are exceeded, a company may file a complaint with the court, the purpose of which is to control the relevant authorities’ actions. A company may also file civil claims against the State Treasury, if it proves that a seizure was unlawful and caused damage.
27 How can privileged material be lawfully protected from seizure during a dawn raid or in response to a search warrant in your country?
A company cannot refuse to provide the authorities with privileged materials. However, if privileged material is subject to seizure, the company should adopt some additional measures aimed at its protection.
If the materials are subject to the attorney–client privilege, they should be provided in a sealed package or envelope. The public prosecutor is obliged to ask the court for permission to use such materials in an investigation. The court may grant permission (i.e., waive the privilege) as an ultima ratio (i.e., if the facts relevant to the investigation cannot be established without the use of the privileged materials).
If the materials are protected by privilege that is attached to the defence counsel, they cannot be seized.
28 Under what circumstances may an individual’s testimony be compelled in your country? What consequences flow from such compelled testimony? Are there any privileges that would prevent an individual or company from providing testimony?
Witnesses have a duty to provide a testimony. However, there are significant exceptions from this rule:
- suspects may exercise their right against self-incrimination. They have the right to remain silent but not the right to lie (i.e., they may refuse to provide a self-incriminating testimony but may not mislead the authorities);
- witnesses may refuse to provide any testimony at all if they are related to the suspect (e.g., a spouse, an ascendant, a descendant, a sibling or a domestic partner);
- witnesses may refuse to answer specific questions, if the answer exposes them or a person related to them to any criminal liability; and
- witnesses who are legally obliged to keep relevant information confidential (for instance attorneys, because of their privilege) cannot disclose privileged information unless they are released from that obligation by a court.
Whistleblowing and employee rights
29 Describe the whistleblowing framework in your country. What financial incentive schemes exist for whistleblowers? What legal protections are in place for whistleblowers?
At present, Polish law does not include any provisions for whistleblower protection or incentives to whistleblowers.
Nevertheless, some regulations are expected to come into force soon, as Poland is obliged to implement Directive (EU) 2019/1937 on the protection of persons who report breaches of Union law (the EU Whistleblower Directive) by December 2021. The EU Directive obliges EU Member States to ensure the legal protection of reporting persons working in the private or public sector who (1) have acquired information about breaches of EU law in a work-related context, (2) have reasonable grounds to believe that the reported information is true and falls within the policy areas covered by the Directive and (3) reported the information internally, externally or by way of public disclosure. The legal protections are to include prohibition of any form of retaliation, access to support measures, ensuring the whistleblowers’ right to an effective remedy and fair trial, as well as introducing penalties applicable to individuals that hinder or attempt to hinder reporting or retaliate. The EU Directive also requires EU Member States to ensure, at a minimum, that legal entities with 50 or more workers establish channels and procedures for internal reporting and follow-up of any whistleblower’s report. Finally, it requires EU Member States to designate authorities competent to receive, give feedback and follow up on whistleblower reports and to provide these authorities with proper resources.
On 18 October 2021, the Polish government published the first draft implementation bill. In general, the draft reiterates the provisions of the EU Directive. However, in some instances, the government has chosen to extend the scope of protection. For example, whistleblowers will be protected not only in the event of reporting breaches of specific acts of EU law, but also Polish law. Companies in the financial sector will be obliged to implement internal reporting channels regardless of how many employees they have.
There may be some challenges for certain large companies (i.e., those with more than 249 employees), which will have only two weeks (from the time the Polish implementation bill comes into force) to comply with the new law, in particular with respect to the requirements concerning internal reporting channels. Failure to comply may result in a fine and imprisonment.
30 What rights does local employment law confer on employees whose conduct is within the scope of an investigation? Is there any distinction between officers and directors of the company for these purposes?
There are no special legally protected rights for employees whose conduct is within the scope of an internal investigation. Employees are obliged to collaborate with the employer, but there are no specific laws requiring them to participate in an internal investigation (in the absence of any specific obligations set out in the employment contract). Employees should be informed that the investigation is conducted not in their personal interest but in the interests of the company. The employee must be protected at all times by the applicable data protection and privacy laws. There is no distinction between officers and directors of the company for that purpose.
31 Do employees’ rights under local employment law differ if a person is deemed to have engaged in misconduct? Are there disciplinary or other steps that a company must take when an employee is implicated or suspected of misconduct, such as suspension or in relation to compensation?
The law does not provide for any particular steps in this regard. However, the Polish Labour Code allows an employer to terminate the contract if an employee has engaged in misconduct.
Polish law does not entitle an employer to suspend an employee or the employee’s right to receive compensation. The only situation in which it is possible to unilaterally release an employee from the duty to perform work (while retaining full right to remuneration) is during the notice period. The case law of Polish courts confirms that a suspension in any other situation (even while retaining the full right to remuneration) is unlawful. Nevertheless, the usual practice is that employees are suspended from performing their duties if it is necessary from the point of view of an investigation and if the good of the investigation overrides any employment risks.
32 Can an employee be dismissed for refusing to participate in an internal investigation?
Generally, the employees to whom the Polish Labour Code applies are obliged to collaborate with their employer, but there are no legal consequences, for example, for declining to participate in a witness interview. Depending on the specific set of circumstances, including the obligations included in the employment contract, an employee may be dismissed for refusing to collaborate with his or her employer.
Commencing an internal investigation
33 Is it common practice in your country to prepare a document setting out terms of reference or investigatory scope before commencing an internal investigation? What issues would it cover?
Although the conduct of internal investigations is not regulated, it is practical to set out the scope of the investigation at its outset. That scope would be included later in the investigation report, so it is clear which issues have been investigated by the company. This would cover the allegations of irregularities and facts to be verified, the list of employees to be interviewed and the categories of documents to be collected, and include an outline of the action plan for the investigation.
34 If an issue comes to light prior to the authorities in your country becoming aware or engaged, what internal steps should a company take? Are there internal steps that a company is legally or ethically required to take?
In such a case, the company should prepare for the opening of a criminal investigation by the authorities. Although there is no obligation to do so, it is advisable for the company to conduct an internal investigation. The internal reporting obligations will depend on the company’s policies.
35 What internal steps should a company in your country take if it receives a notice or subpoena from a law enforcement authority seeking the production or preservation of documents or data?
In these circumstances, the company would be obliged to produce the documents (unless it is entitled to object, for example, based on privilege) and, therefore, should take all necessary steps to enable the preservation and production of the documents. Those steps may include sending out a document preservation notice (although it must first be decided whether sending out such a notice would risk the documents being destroyed or concealed) or identifying relevant search terms and custodians.
36 At what point must a company in your country publicly disclose the existence of an internal investigation or contact from a law enforcement authority?
Under Polish law, there is no obligation to self-report in relation to corporate crimes or an internal investigation. The decision to disclose depends on the interests of the company. If the company decides to self-report, it is advisable to disclose the information only after the internal investigation has been fully completed.
There is an exception concerning banks (which under Polish law must inform the authorities without undue delay of any justifiable suspicion that the bank’s activity is being used to conceal a tax crime, to finance terrorist activities or to launder money) and financial institutions (which are obliged to report suspicious financial transactions to the relevant financial authorities).
37 How are internal investigations viewed by local enforcement bodies in your country?
So far, Polish law has not provided for any guaranteed benefits from conducting an internal investigation. However, it might be taken into account when the law enforcement authorities or the courts are considering the appropriate penalty for the corporate entity or related individuals. An internal investigation is also considered useful by the authorities, who are willing to use the findings of the investigation for their own purposes.
38 Can the attorney–client privilege be claimed over any aspects of internal investigations in your country? What steps should a company take in your country to protect the privilege or confidentiality of an internal investigation?
Yes. A company may claim the attorney–client privilege, for example, over investigation reports or protocols. The privilege applies if these documents are prepared by an attorney.
However, a company may be obliged to provide such documents to the authorities in other circumstances, in particular if requested and the facts relevant to the investigation cannot be established without the use of the privileged materials.
39 Set out the key principles or elements of the attorney–client privilege in your country as it relates to corporations. Who is the holder of the privilege? Are there any differences when the client is an individual?
The attorney–client privilege in Poland originates from a lawyer’s duty to keep all the affairs of a client confidential. This is legally protected by the right to remain silent if examined as a witness. It also covers documents providing legal advice, as well as communications between lawyers and their clients concerning legal advice.
As a rule, an attorney is the holder of privilege. However, it follows from case law that because the purpose of the privilege is to protect the client’s interests, the client may also claim that certain information or documents are privileged and, therefore, cannot be disclosed to the authorities.
The same rules apply to both corporations and individuals.
40 Does the attorney–client privilege apply equally to in-house and external counsel in your country?
Generally, the attorney–client privilege applies equally to in-house and external counsel. Polish regulations provide for specific guarantees of independence of the in-house counsel (i.e., they should have an independent position in a company and report directly to the headquarters).
However, since Poland is an EU Member State, specific requirements regarding in-house counsel provided for in the case law of the Court of Justice of the European Union also apply (for instance, as described in the Akzo Nobel case). Therefore, the application of privilege to in-house counsel may be challenged, in particular in antitrust investigations carried out by the European Commission.
41 Does the attorney–client privilege apply equally to advice sought from foreign lawyers in relation to investigations in your country?
Polish law distinguishes between EU lawyers and non-EU lawyers. EU lawyers (listed by the bar of advocates or the bar of legal advisers) have the same scope of powers and duties as Polish lawyers. Non-EU lawyers, on the other hand, may provide legal advice and prepare legal opinions regarding the law of the country of their qualification or international law.
Therefore, the attorney–client privilege in relation to advice concerning investigations in Poland applies equally but only to Polish and EU lawyers.
42 To what extent is waiver of the attorney–client privilege regarded as a co-operative step in your country? Are there any contexts where privilege waiver is mandatory or required?
Polish law does not provide for a general concept of a waiver of the attorney–client privilege.
However, the client (not the attorney, who has a duty of confidentiality) may decide to disclose the information protected by the attorney–client privilege to the authorities. It may be regarded as a collaborative step in certain circumstances, although there are no specific provisions of law addressing this issue.
43 Does the concept of limited waiver of privilege exist as a concept in your jurisdiction? What is its scope?
Polish law does not provide for a general concept of limited waiver of the attorney–client privilege. However, if a company produces privileged information to law enforcement of its own volition), it does not mean that it has to provide the information to other third parties.
Third parties, however, may request the public prosecutor to provide privileged information that is collected in the course of a criminal investigation, if specific criteria are met (i.e., disclosure does not undermine the correct conduct of the investigation or an important state interest). An interest of the party who shared privileged information is not a factor that the public prosecutor has to take into account.
44 If privilege has been waived on a limited basis in another country, can privilege be maintained in your own country?
Waiver of privilege in another country has no direct legal effect on claiming privilege in Poland.
However, it cannot be entirely ruled out that the authorities may seize privileged documents or information from a third party in another country if that party cannot claim privilege under Polish law.
45 Do common interest privileges exist as concepts in your country? What are the requirements and scope?
Polish law does not provide for a general concept of common interest privilege. However, privilege in Poland is also linked to specific information or documents and not only to a person who is the recipient of privileged information or documents. Therefore, if the privileged information is voluntarily shared with a third party, then the third party may also claim that the information is privileged.
In any event, the third party may be obliged to provide privileged information or documents to the authorities in certain circumstances, in particular if requested and the facts relevant to the investigation cannot be established without the use of the privileged materials.
46 Can privilege be claimed over the assistance given by third parties to lawyers?
The attorney–client privilege in Poland originates from a lawyer’s duty to keep all the affairs of a client confidential. A lawyer has a duty to keep confidential all the information received in relation to the provision of legal services.
Therefore, if a lawyer benefits from the assistance of third parties (e.g., external experts or consultants), he or she may claim that the information or documents produced by the third party were provided in relation to the provision of legal services.
47 Does your country permit the interviewing of witnesses as part of an internal investigation?
There are no regulations permitting or prohibiting witness interviews and, therefore, they are conducted informally. The provisions of the Code of Criminal Procedure concerning witness testimonies (and, in particular, a witness’s right to refuse to answer certain questions) do not apply to such interviews, although statements made by witnesses may affect the criminal proceedings.
However, participation in an interview is based on an employee’s duty to collaborate with the employer or on specific contractual obligations towards the employer, and is voluntary in this respect. The employees generally do not face any legal consequences for refusing to be interviewed, apart from those stemming from the company’s policies. Similarly, third-party employees or former employees cannot be coerced into attending the interview.
If the witness is an employee within the meaning of the Polish Labour Code, he or she generally has an obligation to maintain the confidentiality of company secrets or information that could cause harm to the employer.
48 Can a company claim the attorney–client privilege over internal witness interviews or attorney reports?
Yes, a company may claim the attorney–client privilege if any such interview protocols or reports have been prepared by an attorney.
49 When conducting a witness interview of an employee in your country, what legal or ethical requirements or guidance must be adhered to? Are there different requirements when interviewing third parties?
As the manner of conducting internal investigations is not regulated under Polish law, there are no specific requirements for warnings or information to be provided to the witnesses interviewed in the course of an internal investigation.
However, in practice, Upjohn warnings explaining that the interviewing attorney acts on behalf of the company and not the interviewee are used, especially in cases where the company in question may be subject to US anti-corruption laws.
Regardless of the foregoing, the personal rights of the interviewee and the data protection laws should always be taken into account by the interviewing team. Also, if the employee is a member of a trade union within the meaning of the Polish Labour Code, a trade union representative may have to be present during the interview.
50 How is an internal interview typically conducted in your country? Are documents put to the witness? May or must employees in your country have their own legal representation at the interview?
There are no specific regulations as to the conduct of a witness interview. However, the interview would typically be conducted by an attorney who is a member of the internal investigation team. At the outset, the attorney will give an Upjohn warning, explain the purpose of the interview and ask the interviewee to keep the meeting confidential. The attorney will take notes from the meeting. Notes from interviews may be used as evidence in criminal proceedings, for instance to verify testimonies before the courts.
Documents may be shown to a witness during an interview but are usually not provided to the witness before the meeting.
Owing to the informal nature of witness interviews conducted as part of an internal investigation, if an interviewee asks for his or her legal representative to be present, there are no grounds to force the witness to attend the meeting without such representation.
Reporting to the authorities
51 Are there circumstances under which reporting misconduct to law enforcement authorities is mandatory in your country?
Generally, under Polish law there is no legal obligation to report misconduct to law enforcement authorities (i.e., to self-incriminate).
However, Polish law provides for specific rules under which an individual or an entity, having knowledge about the misconduct of others, is obliged to report it to law enforcement authorities. The Polish Criminal Code provides that failure to notify the law enforcement authorities about specific criminal offences (against the state, life and health, personal freedom or of a terrorist nature) is a criminal offence in itself.
On a related note, the provisions of law concerning cybersecurity issues, data protection, money laundering or taxes also include obligations to report certain incidents or transactions that are not necessarily misconduct per se.
52 In what circumstances might you advise a company to self-report to law enforcement even if it has no legal obligation to do so? In what circumstances would that advice to self-report extend to countries beyond your country?
It depends on the facts and circumstances of an individual case. The bottom line is that self-reporting may be advisable (e.g., in corruption-related matters) if a company (or those of its directors or officers who may be held individually liable for a criminal offence) may gain any kind of advantage in this way.
Under the Polish Criminal Code, an individual cannot be held liable for offering or giving a bribe to a public official (or to a manager in the case of managerial corruption), if he or she discloses all material facts of the criminal offence to the relevant law enforcement authority before the authority discovers the offence on its own.
Another example relates to the criminal offence of abuse of trust, or acting to the detriment of the company. If an offender voluntarily redresses the damage caused to the company by such an offence before the criminal investigation is initiated, he or she cannot be held liable for the offence.
Similarly, an individual cannot be held liable for a criminal tax offence (or a tax misdemeanour) if, after the offence was committed, he or she (1) notified the law enforcement authority about all material facts relating to the offence, in particular about the other offenders taking part in a criminal scheme, (2) paid the entire tax debt and (3) cannot be considered a person organising or ordering a criminal tax offence, inducing others to do so or leading a group of offenders.
53 What are the practical steps you need to take to self-report to law enforcement in your country?
The timing is crucial. Self-reporting may be advantageous for an individual or a company if it is made either before the law enforcement authorities learn about a criminal offence on their own, or before a criminal investigation is initiated. Therefore, the company should try to verify whether this is the case in a particular matter (although it may be very difficult in practice because of the principle of secrecy of the criminal investigation).
Before any irregularity is self-reported, a company should also establish all material facts thereof, in particular by way of an internal investigation and assessment of all related legal, operational and public relations risks.
Responding to the authorities
54 In practice, how does a company in your country respond to a notice or subpoena from a law enforcement authority? Is it possible to enter into dialogue with the authorities to address their concerns before or even after charges are brought? How?
Yes, it is quite common in practice. Law enforcement authorities usually list the information, documents, data, hardware, etc. they require in a subpoena. If there are any doubts as to the scope of materials to be provided, it is always worth seeking clarification from the authorities.
A company should not obstruct an investigation. It should co-operate with the law enforcement authority but should not be overly accommodating.
Although there are no procedural rules to do this, a company may also address the authority’s potential concerns even before the charges are brought. For example, it is sometimes worth providing written explanations to the authority if the company learns about any allegations filed with the authority by a third party.
After the charges are brought, an individual or the company may provide their explanations. This can be done at any stage of the proceedings.
55 Are ongoing authority investigations subject to challenge before the courts?
The decision to start an investigation or to bring charges against an individual or a company cannot be challenged before the courts. However, a party to the investigation (the suspect or the aggrieved party) may file a complaint with the court if the investigation is prolonged, and may seek liquidated damages of up to 20,000 złotys.
The decision to refuse to commence or to discontinue an investigation may be challenged by an aggrieved party, or a party that cannot be considered aggrieved but has notified the authorities about a criminal offence that violated its rights.
56 In the event that authorities in your country and one or more other countries issue separate notices or subpoenas regarding the same facts or allegations, how should the company approach this?
There are no provisions of Polish law addressing this issue. Fundamentally, the scope of the subpoena issued by the authorities is non-negotiable and the party requested to provide materials has a duty to do so. Of course, a party requested to provide materials may contact the authorities to request clarification of any potential doubts.
In practice, subpoenas issued by foreign authorities should be enforced in Poland by the Polish authorities. The Polish Code of Criminal Procedure provides for the rules governing international legal aid in the course of the pending investigation as follows:
- If the authorities from an EU Member State request enforcement of a subpoena, the Polish authorities may refuse to enforce it only if (1) the act in relation to which the subpoena has been issued is not a criminal offence under Polish law (with some exceptions), (2) the evidence listed in the subpoena cannot be collected (e.g., because it has been lost or damaged or cannot be found), (3) the subpoena relates to a criminal offence in respect of which the criminal investigation has ended with a final and binding judgment, or (4) other formal requirements (concerning mainly related documentation) are not met.
- If the authorities from non-EU states request enforcement of a subpoena, the Polish authorities may refuse to enforce the subpoena if its enforcement is contrary to the fundamental principles of the Polish legal system or if it violates the sovereignty of the Republic of Poland.
57 If a notice or subpoena from the authorities in your country seeks production of material relating to a particular matter that crosses borders, must the company search for, and produce material, in other countries to satisfy the request? What are the difficulties in that regard?
No. Companies are not obliged to produce materials from abroad. In practice, companies often explain in their responses to subpoenas that they are not in possession of, or do not have access to, materials located abroad and another entity may have to respond.
58 Does law enforcement in your country routinely share information or investigative materials with law enforcement in other countries? What framework is in place in your country for co-operation with foreign authorities?
Yes. Within the European Union, this is regulated mainly by the Treaty on the Functioning of the European Union (Articles 82 to 89), regulations concerning Europol, Eurojust and specific regulations and directives focused on particular types of criminal offences or procedural issues. However, Poland has not accessed the European Public Prosecutor’s Office, which has been operational since 1 June 2021.
The respective EU regulations are implemented into Polish law and refer mainly to (1) the collection of evidence and confiscation of freezing measures, (2) conducting investigative actions (e.g., on the basis of an European Investigation Order), (3) enforcement of a European Arrest Warrant, or (4) implementation of other precautionary measures.
In the case of non-EU states, the Polish authorities have a general duty to co-operate. However, they may refuse to provide legal assistance if:
- to do so would be contrary to the fundamental principles of the Polish legal system;
- it violates the sovereignty of the Republic of Poland;
- a request for legal assistance comes from a country that does not provide reciprocity;
- a request is made in relation to an act that cannot be considered a criminal offence under Polish law; or
- the requested legal assistance is outside the scope of powers granted to the public prosecutor’s office in Poland.
The Polish authorities may also form investigative teams with the authorities from other countries.
59 Do law enforcement authorities in your country have any confidentiality obligations in relation to information received during an investigation or onward disclosure and use of that information by third parties?
There is a general rule of secrecy of a criminal investigation. Public disclosure of information about a criminal investigation is a criminal offence in Poland.
However, the public prosecutor may – at his or her sole discretion – decide about public disclosure of information about a particular investigation (also in the media). The Polish law on the Public Prosecutor’s Office enables the General Prosecutor, the Deputy General Prosecutor and the public prosecutors authorised by them to share information concerning particular investigations with third parties if sharing that information may be significant for national security and the proper functioning of the state.
Third parties’ access to investigation files is also determined by the public prosecutor at his or her discretion. The public prosecutor may refuse to grant access to the files only if access would undermine the correct conduct of the investigation or an important state interest.
60 How would you advise a company that has received a request from a law enforcement authority in your country seeking documents from another country, where production would violate the laws of that other country?
We would advise a company to respond to the law enforcement authority that it is unable to provide documents from another country because of local laws, and to suggest that the authority should use the formal procedure for co-operation with the local enforcement authority.
61 Does your country have secrecy or blocking statutes? What related issues arise from compliance with a notice or subpoena?
Council Regulation (EC) No. 2271/96 (the EU Blocking Regulation), which is applicable in Poland:
- prohibits any individuals who live in the European Union or who are citizens of any EU Member State, as well as companies having their seat in the European Union, from complying with any US acts imposing sanctions on Cuba, Iran and Libya;
- provides that no judgments or decisions giving effect to the above-mentioned US acts will be recognised or enforceable in EU Member States; and
- provides for a right to seek compensation for any damage sustained as a result of the application of the above-mentioned US acts.
Therefore, if a subpoena is based on or concerns one of the US acts listed in the EU Blocking Regulation, the party receiving the subpoena should not respond to it, unless it is granted special permission by the European Commission.
62 What are the risks in voluntary production versus compelled production of material to authorities in your country? Is this material discoverable by third parties? Is there any confidentiality attached to productions to law enforcement in your country?
Voluntary production may not be advisable if it does not give any advantage to the company in a particular case. It may expose the company, for example, to a risk that the law enforcement authorities would incorrectly consider specific actions of the company unlawful and would like to ‘dig deeper’. If the company wishes to disclose information voluntarily, the data protection issues should also be considered.
Compelled production, on the other hand, may be adapted to the actual needs of the law enforcement authority. In such cases, the company must not produce any documents that are not necessary for the law enforcement authority. In terms of data protection regulations, in such cases the company has a clear legal basis to produce materials.
The materials provided to the law enforcement authorities may be discoverable by third parties, in particular if they prove that their access would not undermine the correct conduct of the investigation or an important state interest. The public prosecutor may – at his or her sole discretion – decide about public disclosure of information about a particular investigation (including in the media) if sharing that information may be significant for national security and the proper functioning of the state.
Prosecution and penalties
63 What types of penalties may companies or their directors, officers or employees face for misconduct in your country?
Individuals can be liable to fines, restriction of liberty (in the form of community service or salary deduction) or imprisonment. There are also some additional punitive measures that may be adopted, namely (1) a ban on holding specific functions, practising specific professions or pursuing business activities of a specific kind, (2) publication of the judgment, or (3) an obligation to redress any damage resulting from a criminal offence.
Currently, companies can be liable to fines of up to 5 million złotys, but not more than 3 per cent of the revenues generated in the financial year in which the prohibited act was committed. Additional punitive measures that may be imposed on a company are as follows:
- forfeiture of assets or economic gains originating from, or used to commit, the prohibited act;
- prohibition of promotions or advertising;
- prohibition of the use of financial support from public funds;
- prohibition of seeking the award of public contracts; or
- publication of the judgment.
64 Where there is a risk of a corporate’s suspension, debarment or other restrictions on continuing business in your country, what options or restrictions apply to a corporate wanting to settle in another country?
If a company wants to settle in another country, there is a risk that the settlement will be used to its disadvantage in Poland (as the evidence that a criminal offence or prohibited act being subject to the settlement was actually committed). Therefore, if this is the case, the company should assess the risk of liability in Poland and, in particular, the chances of a successful defence against that liability, based inter alia on the compliance defence or rules providing for the exclusion of double jeopardy.
65 What do the authorities in your country take into account when fixing penalties?
The criteria for fixing penalties for individuals are provided for in the Polish Criminal Code and include:
- the degree of guilt;
- the degree of public harm and any other negative consequences caused by a criminal offence;
- the preventive and educational objectives that the penalty is to achieve;
- the need to develop legal awareness in society;
- the types of duties breached; and
- the efforts to redress the damage.
In terms of companies, the criteria include:
- the scope of irregularities in choosing or supervising individuals who are personally liable for a criminal offence;
- the scope of economic gains originating from the criminal offence;
- the financial situation of the company; and
- the impact of the penalty on the future operation of the company.
Resolution and settlements short of trial
66 Are non-prosecution agreements or deferred prosecution agreements available in your jurisdiction for corporations?
Neither non-prosecution agreements nor deferred prosecution agreements are available for corporations in criminal cases in Poland.
The 2018 draft Act on the Liability of Corporate Entities for Acts Prohibited under Penalty (the Draft Liability Act) provides for a settlement-like tool in dealings with the public prosecutor, allowing corporate entities to avoid widespread legal consequences of a criminal offence. In particular, the public prosecutor will be able to file a motion for a voluntary submission of a corporate entity to criminal liability to be approved by the court if the following prerequisites are met: (1) the circumstances of the criminal offence are beyond doubt; (2) the corporate entity has disclosed to the authorities information about the criminal conduct of an individual committing the offence; and (3) the corporate entity has paid the equivalent of the damage caused by the offence and the equivalent of the lowest financial penalty for the offence, and has consented to forfeiture. The final judgment will not be recorded in the criminal register.
67 Does your jurisdiction provide for reporting restrictions or anonymity for corporates that have entered into non-prosecution agreements or deferred prosecution agreements until the conclusion of criminal proceedings in relation to connected individuals to ensure fairness in those proceedings?
There are currently no regulations on reporting restrictions or anonymity since it is not possible for corporations to enter into non-prosecution agreements or deferred prosecution agreements in criminal cases in Poland.
The Draft Liability Act does not provide for any related regulations.
68 Prior to any settlement with a law enforcement authority in your country, what considerations should companies be aware of?
Under the Draft Liability Act, the public prosecutor will be able to file a motion for a voluntary submission of a corporate entity to criminal liability to be approved by the court if the following prerequisites are met: (1) the circumstances of the criminal offence are beyond doubt; (2) the corporate entity has disclosed to the authorities information about the criminal conduct of an individual committing the offence; and (3) the corporate entity has paid the equivalent of the damage caused by the offence, and the equivalent of the lowest financial penalty for the offence, and has consented to forfeiture.
69 To what extent do law enforcement authorities in your country use external corporate compliance monitors as an enforcement tool?
Polish law currently does not provide for the use of external corporate compliance monitors by Polish law enforcement authorities.
70 Are parallel private actions allowed? May private plaintiffs gain access to the authorities’ files?
Civil proceedings might take place in parallel with criminal matters. Private plaintiffs might gain access to criminal files.
Publicity and reputational issues
71 Outline the law in your country surrounding publicity of criminal cases at the investigatory stage and once a case is before a court.
There is a general rule of secrecy of the criminal investigation but the prosecutor may decide to disclose information about the investigation publicly.
If a case is being heard before a court, it essentially becomes public (with some exceptions for specific procedures). Also, the media may broadcast the trial. The court may, however, exclude the public from a trial if (1) the circumstances discussed should be kept confidential because of a significant state interest, or (2) there is a need to protect an important private interest. In any event, the judgment is announced publicly.
72 What steps do you take to manage corporate communications in your country? Is it common for companies to use a public relations firm to manage a corporate crisis in your country?
Yes. In such cases, close co-operation between legal and public relations advisers is advisable, so that the corporate communication is aligned with the corporate legal defence strategy.
73 How is publicity managed when there are ongoing related proceedings?
Because of the general rule of secrecy of the criminal investigation, the charges brought by the law enforcement authorities cannot be commented on publicly. However, this rule does not apply when a case is brought before a court or in the case of civil proceedings.
Duty to the market
74 Is disclosure to the market in circumstances where a settlement has been agreed but not yet made public mandatory?
Generally no, but it may be required with respect to publicly listed companies.
Environmental, Social and Corporate Governance (ESG)
75 Does your country regulate ESG matters?
EU laws on ESG reporting apply in Poland. For example, following the EU requirements, the Polish law on accounting has recently introduced a provision that requires the biggest financial institutions and publicly traded companies (e.g., with 500 employees or more or 85 million złotys of total balance sheet assets per annum) to report in their financial statements non-financial issues, including ESG risks, policies etc. in a manner allowing the company’s effects on the environment and social aspects to be assessed. The Polish stock exchange has also recently published guidelines on ESG reporting for publicly traded companies.
76 Do you expect to see any key regulatory or legislative changes emerge in the next year or so designed to address ESG matters?
Yes, we expect to see the implementation of further EU laws on ESG reporting, including the EU Green Deal laws, such as Regulation (EU) 2020/852 on the establishment of a framework to facilitate sustainable investment (the EU Taxonomy Regulation), which will enter into force in January 2022, or the planned Corporate Sustainability Reporting Directive.
77 Has there been an increase in ESG-related litigation, investigations or enforcement activity in recent years in your country?
Yes, ESG-related litigation is an increasing trend in Poland.
Recently, an environmental non-governmental organisation, Client Earth, has initiated two litigations against state-related energy conglomerates in relation to the coal-fired power plants operated by them.
In a case against Enea SA, Client Earth sought an annulment of Enea’s management board resolution giving consent to the construction of the Ostroleka C power plant. The case was decided in favour of Client Earth.
In a case against PGE SA, Client Earth demanded that PGE reduce the greenhouse gas emissions from Europe’s largest power plant, Belchatow, which is operated by PGE. The first instance court ruled that PGE must negotiate and settle the effects of Belchatow on the climate, although no settlement was reached by the prescribed deadline.
Client Earth is also representing five Polish citizens who have recently sued the Polish State Treasury in the Polish courts for inaction on the climate crisis, demanding the state’s admission of responsibility to adhere to the Paris Agreement (the international treaty on climate change) and redress the emission of greenhouse gases. All five cases are being heard by different district courts in Poland.
78 Do you expect to see any key regulatory or legislative changes emerge in the next year or so designed to address corporate misconduct?
Although the amendment of the corporate criminal liability law is a long-awaited legislative change, the implementation of Directive (EU) 2019/1937 on the protection of persons who report breaches of Union law (the EU Whistleblower Directive) is expected to be the key legislative change to be made in the compliance field.
1 Marcin Ciemiński is a partner, Paweł Pogorzelski is a counsel, and Monika Diehl and Michał Magdziak are advocates at Clifford Chance.