POLAND Law and Practice Contributed by: Wojciech Trzciński, Łukasz Łyczko, Konrad Frąckowiak and Katarzyna Kaczmarzyk, PwC Legal Business Solutions
provide the AIF client with offering documents that include: • the business name, registered office and address of the AIF; • the name, registered office and address of the AIFM; • a description of the objectives of the AIF; • a description of its procedures; • a description of the main legal implications of mak - ing the investment; • a description of the methods and principles of asset valuation; • a description of the liquidity management; • a description of the acquisition procedures; and • other information relevant for the client and speci - fied in the IFA. Annual Financial Statements of AICs Annual financial statements of Polish AICs must be filed in the publicly accessible electronic repository of financial documents. AIFMs IFCs (ie, AIFMs for SOEIFs and CEIFs) are obliged to submit periodic reports to the PFSA regarding, in par - ticular, investment activities carried out on behalf of managed entities, the liquidity and risk management of such entities, and the use of financial leverage. After the end of each financial year, the IFC is required to provide the PFSA and the participants in a given fund (upon request) with the annual report of the AIF, prepared separately for each SOEIF and CEIF. A simi - lar obligation applies to licensed AIFMs of AICs. 2.4 Tax Regime for Funds Polish SOEIFs and CEIFs are considered tax residents in Poland and are subject to tax at 19%, although they may benefit from an objective tax exemption. The exemption in question does not apply to the following types of income: • income from participation in tax-transparent enti - ties; • interest income from loans granted to tax-transpar - ent entities;
• interest income from participation in tax-transpar - ent entities (eg, from profit participation loans); • donations or other free or partially free of charge benefits made by tax transparent entities; • interest (discount) income (revenues) from securi - ties issued by tax-transparent entities; • income (revenues) from sale of securities issued by tax transparent entities; and • income derived from real estate (buildings/part of buildings located in Poland owned or co-owned by a taxpayer, which are subject to lease/tenancy, regardless of its type). Polish AICs may also benefit from an objective tax exemption. However, it covers only capital gains sourced on the disposal of shares (5% shareholding held over two years is required). 2.5 Loan Origination SOEIFs SOEIFs are not allowed to lend cash. However, they are allowed to lend dematerialised securities under certain conditions – in particular, the participation of investment companies/custodian banks is required or the loan must be made within the Settlement Liquidity Security System. The total amount of securities lent may not exceed 30% of the value of the net assets of the SOEIF. The loan must also be properly collat - eralised. CEIFs CEIFs may grant cash loans up to a maximum of 50% of the value of the CEIF’s assets, provided that the amount of any cash loan granted to any single enti - ty does not exceed 20% of the value of the CEIF’s assets. The CEIF’s statute shall specify further con - ditions for the granting of loans. The CEIF may also lend securities. AICs There are no legal restrictions on the granting of loans by AICs. However, such an activity needs to comply with the investment policy adopted by the AIC. 2.6 Non-Traditional Assets Digital Assets As a general rule, Polish SOEIFs and CEIFs are not allowed to invest in cryptocurrencies. Indirect invest -
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