Polish Briefing: Intergovernmental Nord Stream 2. Pro-competitive EU directives

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What goes in Poland on 31th of May.

Presidential couple visiting Georgia

On Monday President Andrzej Duda arrived to Georgia together with his wife Agata Kornhauser-Duda. The president will talk to the Georgian leaders about NATO and EU-Tbilisi cooperation, but the main focus will be on relations between the two countries.

„During the meetings with Georgian authorities, the President will discuss, among others, last week’s NATO meeting in Brussels”, informed Krzysztof Szczerski, chief of the president’s cabinet. According to him, during the North Atlantic summit Poland was one of the states that „pushed for an open doors policy” and the continuation of partnerships with states like Georgia and Ukraine.

The presidents Andrzej Duda and Giorgi Margvelashvili are to sign a declaration on Polish-Georgian cooperation.

Intergovernmental Nord Stream 2

„The Nord Stream 2 agreement should be signed between governments, not companies”, said Mateusz Morawiecki, Polish Vice-Prime Minister and Minister of Development and Finance, who met in Brussels with Cecilia Malmström, EU Commissioner for Trade.

Morawiecki confirmed that Poland’s position on Nord Stream 2 was unequivocal. „Our position is firm and clear, we believe this agreement should be signed between governments, not countries, which is why it should be subject to full approval procedure by the European Commission,” he explained. Morawiecki also ensured the Commissioner agreed with him, but she also pointed that there were other member states that had their own interests.

Pro-competitive EU directives

On Monday representatives of the EU states adopted regulations that will help to battle tax avoidance by multinationals. The new law will make it harder for corporations to use the differences in regulations between EU and non-EU states.

The changes pertain to the Directive, which deals with mismatches when it comes to hybrid structures in non-EU states. The so-called hybrid mismatches occur when states have different taxation rules on profits or entities. International corporations use them to pay lower taxes, or completely avoid them.

The EU already has regulations that tackle the differences between business taxation systems in Member States. However, the new tools will allow the 28 states to make it harder for multinationals to use the so-called hybrid structures to escape taxation to non-EU countries.

The Directive has been adopted without further discussion on the Monday meeting of EU ministers responsible for competition. Poland was represented by Vice-Prime Minister and Minister of Finance, Mateusz Morawiecki. The agreement on the new regulations had been negotiated back in February, but the EU Council could not adopt them without a recommendation from the European Parliament, which announced its position in April.

Growing number of Ukrainians

More than 227 thousand Ukrainians are covered by Polish pension and retirement insurance. However, this figure is not high when compared to the actual number of employed foreigners. According to the Polish Social Insurance Institution (ZUS), in the first quarter, 330.3 thousand foreigners were covered by the insurance. The figure increased by 50% in comparison to last year (125 thousand people) and by 100% in comparison to 2015 (193 thousand).

Obviously, such a dynamic increase results from the rapidly growing demand for foreign workers in Poland. Only last year employers registered demand for 1.3 million foreigners using the simplified procedure. Additionally, 127 thousand job permits were issued (almost twice as many as in 2015).

In total, in the first quarter there were 227 thousand. Their number is also growing the most rapidly (in the first quarter, the year on year increase was 90%). When it comes to other nations, we can talk about an increase in the number of Belarusians and Moldovans (by ca. 60% year on year), as well as Indians (by 40%).