NEWSLETTER

No. 5, April 2021

Malinowski & Associates. Legal Advisors. Partnership

Table of contents

The bill on citizen commercial judges.

Citizen commercial judges.

Requirements and exclusions for persons serving as a civil commercial judge.

Election of citizen commercial judges.

The term and mandate of the citizen commercial judge.

Per diems of citizen commercial judges.

Changes to the Code of Civil Procedure.

Extension of deadline for filing CIT tax return.

Draft law on amending the law on compensating for property losses resulting from restrictions during a state of emergency on human and civil liberties and rights.

Draft amendment to the Labor Code – leave of absence for entrepreneurs.

Senate bill on amendments to the Law – Entrepreneurs’ Law.

Bill on citizen commercial judges

On March 19, 2021, a parliamentary bill on citizen commercial judges and amendments to certain other laws (hereinafter: the OSH bill) was submitted to the Parliament. As of April 12, 2021, the project has not yet received a print number.

According to the Preamble of the bill, the law aims to expand the right of civil society from participating in the administration of justice and to increase the influence of citizens in the administration of justice, as well as to improve the adjudication of business cases by the courts.

Citizen trade judges

Citizen commercial judges are appointed in district courts where commercial departments have been established. In terms of adjudication, citizen commercial judges are independent and subject only to the Constitution and laws, and in deciding cases they have equal rights with judges, but a citizen commercial judge may not preside at a hearing and deliberation or perform the duties of a judge outside of a hearing (Article 2 of the OSH bill).

Citizen commercial judges have a duty to hold office with independence, impartiality, dignity and integrity, and to avoid behavior that could raise reasonable doubt about this. A citizen commercial judge is also obliged to keep confidential any circumstances of the case of which he became aware due to his function outside the public hearing. The official dress of a civil commercial judge is the official dress of a judge.

Requirements and exclusions for persons serving as citizen commercial judge

A citizen commercial judge can be one who:

1. Has Polish citizenship and enjoys full civil and civic rights
2. She is of impeccable character
3. Completed 29 years of age, but under 70 years of age
4. Has been employed, self-employed or living in the place of candidacy for at least one year
5. He is capable by virtue of his health to hold office
6. In the last 5 years, at least for two years:
   1. He was running a business
   2. Was a partner of a general partnership or a partnership, a member of the management board of a partnership, a general partner of a limited partnership or a limited joint-stock partnership, a member of the management board or a liquidator of a limited liability company, a joint-stock company or a European company, a member of the administrative board of a European company, if these companies conducted business activities during this period
   3. Was a member of the governing body of another legal entity engaged in business activities
   4. Was the manager or liquidator of a European economic interest grouping
   5. He was a proxy
7. Demonstrates knowledge of business cases or other business and civil law cases within the jurisdiction of the commercial court.

A citizen commercial judge cannot be:

1. Person employed in general courts or other courts and prosecutor’s office
2. A person holding a public office or employed by a body whose decision can be demanded to take a case to court
3. Police officer or other person holding a position related to the prosecution of crimes and offenses
4. Advocate and legal advisor practicing and trainee legal advisor and advocate
5. Clergyman
6. Soldier in active military service
7. Prison Service Officer
8. MP, senator, member of the European Parliament
9. Councilman of a municipality, district or province
10. Notary practicing, deputy or trainee notary public
11. Legal advisor to the Attorney General’s Office of the Republic of Poland
12. A practicing bailiff, an assessor or a trainee bailiff
13. Member of a political party.

Election of citizen commercial judges

Civil commercial judges to district courts are elected by secret ballot by the provincial assemblies of the provinces whose area is covered by the jurisdiction of these courts.

The number of citizen commercial judges elected by each provincial assembly shall be determined by the district court colleges.

A candidate for a civil commercial judge may apply on his own or be proposed by associations or other registered social or professional organizations whose statutory task is to work to promote economic development (including entrepreneurship), excluding political parties, by the deadline by June 30 the last year of the term of office of existing citizen commercial judges. The application shall be accompanied by:

1. Information from the National Criminal Register regarding the candidate
2. Candidate’s statement that there are no proceedings against him/her for a crime prosecuted by public indictment or a fiscal crime
3. Candidate’s statement that he/she is not deprived of parental authority
4. Medical certificate of health, stating that there are no contraindications to the office of a judge
5. Document confirming the circumstances specified in Art. 3 paragraph. 1(7) (in our opinion, this element is a clerical error, since the OSH bill does not contain such an editorial unit; presumably, the drafters wanted to indicate Article 5(1)(7), referring to the requirement to conduct business or hold functions in entities conducting such activities).

The provincial parliament shall request information from the provincial police chief or the Metropolitan Police Chief on candidates for citizen commercial judges.

Elections of citizen commercial judges shall be held no later than November of the calendar year in which the term of office of existing citizen commercial judges expires.

The provincial assembly shall forward to the presidents of the relevant district courts a list of elected citizen commercial judges. The president of the district court hands the citizen commercial judge a notice of election and takes the oath of office from him, and then inscribes the citizen commercial judge on the list of citizen commercial judges who may be appointed to adjudicate. A citizen commercial judge is issued a service card.

The first election of citizen commercial judges will be held two years after the year the law takes effect.

Term of office and mandate of the civil commercial judge

The term of office of citizen commercial judges lasts for five calendar years following the year in which the election was held, with the term of office of a citizen commercial judge elected additionally expiring at the end of the term of office of all citizen commercial judges. After the expiration of the term of office, a citizen commercial judge may only participate in the recognition of a case previously started with his participation until its completion.

The mandate of a citizen commercial judge shall expire in the event of:

1. Loss of Polish citizenship or full civil and civic rights
2. A final conviction for a criminal offence and a fiscal offence
3. Occurrence of circumstances that exclude the ability to serve as a civil commercial judge
4. Renunciation of the mandate for valid reasons.

The provincial parliament, which has elected a citizen commercial judge, may dismiss him or her on the motion of the president of the competent district court, reviewed by the college of that court, in the event of:

1. Conduct detrimental to the dignity of the court or detrimental to the interests of justice
2. Failure to perform or improperly perform the duties of a judge
3. Permanent loss of capacity to perform the function of a judge, as determined by the decision of the Social Insurance Institution’s medical examiner, or refusal to submit to an assessment of this capacity, despite referral for examination by the president of the competent district court.

Before adopting a resolution on a motion to dismiss a citizen commercial judge, the chairman of the provincial assembly shall give the judge an opportunity to be heard and to participate in the meeting of the relevant committee and in the session of the assembly at which such motion will be reviewed and considered.

The president of the competent district court shall suspend a citizen commercial judge from his duties in the case of:

1. Initiate proceedings for the dismissal of the civil commercial judge until the provincial assembly passes a resolution on the dismissal
2. The occurrence of circumstances causing the expiration of the mandate of the citizen commercial judge or the initiation of proceedings to remove the citizen commercial judge from participation in the consideration of the case after the expiration of the term – until the provincial assembly adopts a resolution on the expiration of the mandate or removal
3. Initiation of proceedings against a citizen commercial judge for a crime prosecuted by public indictment or a fiscal offense – until the case is finally resolved.

A citizen commercial judge may be appointed to participate in 20 cases during the term of office, and, with his consent, in subsequent cases as well, but not more than 30 cases during the term of office.

An employer who employs a citizen commercial judge is obliged to exempt him from work for the duration of the judge’s activities, with the number of exemptions in each year not exceeding 26 days. The terms of dismissal at the request of the chairman of the relevant department shall be determined by the president of the district court and notified to the employer. For the time off from work, the citizen commercial judge retains the right to benefits under the employment relationship, with the exception of the right to salary.

Per diems of citizen commercial judges

A citizen commercial judge receives a per diem for the time he or she performs the activities of a judge: participating in the trial, deliberating on the verdict or drafting a statement of reasons. The per diem for one day of duty is 9% of the base for determining the judge’s basic salary.

A citizen commercial judge residing outside the seat of the relevant district court shall receive a per diem and reimbursement of travel and lodging expenses according to the rules established for judges of common courts.

Changes to the Code of Civil Procedure

The OSH bill also provides for amendments to the Code of Civil Procedure, allowing citizen commercial judges to adjudicate in practice. In particular, such a function will be fulfilled by the added §²¹ in Art. 47 of the Code of Civil Procedure, according to which , in the first instance, the district court, composed of one judge as chairman and two citizen commercial judges, shall hear commercial cases and other commercial and civil law cases belonging to the commercial court under separate laws. The president of the court shall order such a case to be heard by a single judge in the absence of the possibility of appointing citizen commercial judges, or at the request of a party filed no later than a week before the beginning of the first hearing or in an objection to a default judgment.

In addition, the provisions regarding the exclusion of judges from hearing a case will also apply to citizen commercial judges.

Citizen commercial judges do not rule in the European small claims procedure.

While the idea of allowing citizens to cooperate in the administration of justice is to be welcomed, the proposed solutions for introducing the idea into the legal order may complicate civil proceedings. In particular, it should be noted that citizen commercial judges would operate in district courts, hearing cases belonging to those courts in the first instance. Thus, the vast majority of commercial cases would be those in which the value of the subject of the litigation exceeds PLN 75,000. Among other things, the drafters’ proposed personnel requirements for candidates to serve as citizen commercial judges do not include. the need for knowledge of the law (both substantive and procedural), and even if the criterion of demonstrating “knowledge of business matters or other business and civil law matters within the jurisdiction of the business court under separate laws” is considered as such, based on the proposed wording of the law, this knowledge will not be verified. As a result, people who do not have elementary legal knowledge may be allowed to adjudicate claims exceeding PLN 75,000. Combined with a new panel of judges for such cases, i.e. one judge and two citizen commercial judges, given that the verdict is made by majority vote, a situation may arise in which two citizen commercial judges – acting on their own sense of justice – will outvote the judge and the verdict will be made in deference to the state of the law. This issue should be addressed during the legislative procedure.

Extension of deadline for filing CIT return

On March 29, 2021, the Decree of the Minister of Finance, Funds and Regional Policy dated March 25, 2021 (item 571) on extending the deadline for filing the return on the amount of income earned (loss incurred) and payment of tax due by corporate income taxpayers was published in the Official Gazette.

Based on the aforementioned. The regulations extended the deadline to June 30, 2021 for corporate taxpayers to:

1. to file a return on the amount of income earned (loss incurred) in the tax year that ended between December 1, 2020. until February 28, 2021,
2. payment of the tax due shown in the return referred to in item 1, or the difference between the tax due on the income shown in this return and the sum of the advance payments due for the period from the beginning of the year.

At the same time, the deadline for filing a return on the amount of income by a taxpayer taxed for the first time with a lump sum on income of capital companies has been extended to June 30, 2021, if the first year of lump sum taxation began between January 1 and March 1, 2021.

Draft Law on Amendments to the Law on Compensation of Property Losses Resulting from Restriction during a State of Emergency of Human and Civil Liberties and Rights

On March 29, 2021, a parliamentary bill to amend the Law on Compensation of Property Losses Resulting from Restriction of Human and Civil Liberties and Rights during a State of Emergency was submitted to the Parliament (the bill has not yet been assigned a print number). The main intention of the drafters is to expand the catalog of circumstances justifying allowing the possibility of claiming compensation for property losses resulting from the restriction of human and civil liberties and rights to include the restriction of these rights during a state of epidemic emergency or a state of epidemics.

According to the drafters, the law is to take effect on the day of promulgation, effective March 14, 2020.

The draft implies the introduction of the principle that the law should – in addition to a state of emergency (war, emergency, natural disaster), state of epidemic emergency or state of epidemic emergency – be applied in a situation where restrictions on human and civil liberties and rights will occur, In a specific legal regime for reversing or mitigating the effects of specific risks, regardless of the type of legislation with which it was introduced, following which there will be a property loss.

In the current state of the law, the decision on compensation is issued by the provincial governor immediately, no later than three months from the date of submission of the application for compensation. If the proposed amendments go into effect, the deadline for issuing a decision will be one month from the date of submission of the compensation application.

The drafters propose extending the statute of limitations for a claim for compensation to two years from the date the injured party learned of the property loss.

The drafters also propose to introduce an exemption from the fee of a lawsuit for compensation, filed in connection with an unsatisfactory decision of the governor on compensation.

Draft amendment to the Labor Code – leave of absence for entrepreneurs

On April 2, 2021, a parliamentary bill amending the Labor Code and the Entrepreneurs’ Law was submitted to the Parliament (the bill does not yet have a print number). According to the drafters’ intention, the law is to take effect on January 1, 2022.

The draft provides for an expansion of the definition of “employee” contained in Art. 2 of the Labor Code. Currently, an employee is a person employed under a contract of employment, appointment, election, appointment or cooperative employment contract. If the proposed amendments come into force, an employee within the meaning of the Labor Code will be a person employed under a contract of employment, appointment, election, appointment or cooperative employment contract, and, to the extent regulated by the law, a person performing work under another contract, in particular a contract for the provision of services, as long as he performs work in person, on a permanent basis, for a period of not less than 6 months, with a daily time dimension corresponding to not less than 1/2 of a full-time employment contract.

An individual engaged in sole proprietorship and a partner in a civil partnership in the scope of his business activity, not employing employees, will be granted the right to annual uninterrupted leave of 14 days. It will be possible to suspend business activities for the duration of this leave.

Senate bill on amendments to the law – the law on entrepreneurs

On February 19, 2021, a Senate bill to amend the Entrepreneurs’ Law was submitted to the Sejm (print No. 1087).

With the indicated amendment, the Senate proposes adding Art. 18a in the Entrepreneur Law, based on which an entrepreneur who is a individual, not employing workers, who carries out business activities on a continuous basis for a period exceeding 6 months, may in a given calendar year, in a single month of his choice, pay mandatory social security contributions in the amount of reduced by 50%, on account of the exercise of the right to rest.

They will not be able to use the above entitlement:

1. Entrepreneurs whose income from non-agricultural business activities from the 6 months preceding the month of filing exceeded the amount of PLN 60,000
2. Entrepreneurs who are also farmers or homemakers working with farmers.

The condition for taking advantage of the reduction in premiums is to notify the intention to pay the reduced premium by the 10th of the month preceding the month in which the right to leisure will be realized. In the filing, information on income from non-agricultural business activities in the previous 6 months must be provided.

In the case of using the above. law, the contribution base is not reduced, as the contributions to the full amount will be financed by the state budget through Social Security.