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It is almost a year since the arrangement was approved in the restructuring proceedings of a client in the food production industry. The second report on the implementation of the arrangement has just been submitted, so it is safe to say that the restructuring has been a success.

It all started with the troubles that affected the client immediately before the pandemic broke out. Due to a complete halt in production and a drastic drop in demand for the Client’s products, avoiding the liquidation of the company and the restructuring process was quite a challenge.

During the pandemic, investments were halted, especially in the catering production sector. Despite this, it was possible to find a stable investor who leased the Client’s company, modernised its plant and resumed production. What is more, this was his first such large investment in Poland, which testifies to the trust he placed in our client and the investor’s faith in the success of the restructuring.

Thanks to the investor, the client’s production facility was saved. It was also possible to convince the creditors to support the arrangement, and some of them even agreed to an almost complete write-off of their claims. Why? Because they saw great value in continuing to work with our client’s company. They were not wrong – the plant now provides work for around 150 people and much of the production is for export, which further increases the security of the business and allows us to secure the best conditions for our contractors. The lease of the company was structured in such a way as to secure the fulfilment of a long-term agreement. Some of the creditors were already paid in half or in full in the first month of the implementation of the arrangement.

In the course of the restructuring proceedings, there were of course challenges such as reconciling the interests of many creditors – including preferential creditors (such as farmers) and secured creditors who could block the restructuring. In parallel, we had to litigate with some creditors, all of which we managed to conclude amicably. There were also legal problems, such as the court’s refusal to take into account the votes of some creditors voting in favour of the arrangement, while at the same time taking into account a significant vote against the State Treasury – the Head of the Tax Office. It was not without a complaint against the decision to discontinue the restructuring proceedings, which was upheld in its entirety (the uncounted votes in favour of the arrangement were taken into account and the vote of the Tax Office against the arrangement was annulled).

Thanks to this restructuring, the client not only avoided bankruptcy – it managed to expand its business, provide new jobs in the region and new markets for its products.

The project was managed by the Romanowski i Wspólnicy team led by legal advisor and restructuring advisor Maciej Stasiewicz.

The Romanowski and Partners Law Firm has prepared an opinion for the Senate Extraordinary Committee on Climate Change on the Act on the Principles of Guaranteeing the Obligations of the National Energy Security Agency (“NABE”) by the State Treasury.

The Committee, at its meeting on 6 September 2023, after hearing the arguments of the Firm presented by Prof. Michał Romanowski, Adam Romanowski and Advocate Filip Wawrzak, unanimously voted against the Bill. The Senate of the Republic of Poland rejected the bill on 7 September this year.

The issue of the establishment of NABE can be described as a systemic problem for the Polish economy and society. Indeed, the consolidation of coal assets in NABE would shape the picture of the Polish energy market for the coming years and to a significant extent determine the prices that Poles and Polish entrepreneurs will pay for the energy supplied.

The NABE Act envisaged the creation of an entity that controls the generation and sale of about 50% of the electricity in the national market and a significant part of the controllable generation capacity. The creation of NABE carries a huge risk of reduced competition and high electricity prices, determined by the cost of generation by NABE under the merit order mechanism. In addition, state aid provided exclusively to Treasury-controlled concerns in the absence of concentration control, may lead to the domination of zero and low-carbon generation by Treasury-controlled entities (today the Ministry of State Assets).

We expressed the view that Poland’s energy transformation and energy security does not enforce a state monopoly in the energy market leading to the disappearance of free competition, which is always to the detriment of the economy and households.

Our principal comments related to:

• the lack of legitimacy of the exclusion of concentration control by the President of the OCCP and the risk of finding violations in the follow-up control;
• the risk of considering support granted to energy concerns controlled by the State Treasury as unlawful state aid;
• monopolisation of the electricity market by energy concerns controlled by the State Treasury to the detriment of private entrepreneurs;
• the de facto setting of the price of electricity in Poland by NABE under the merit order mechanism to the detriment of entrepreneurs and consumers.

Link to opinion: HERE

The Supreme Court has accepted for examination the cassation appeal we filed on behalf of a financial institution in the investment market. The Supreme Court will decide when the damage associated with the decrease in the value of a financial instrument arises – does the damage arise only at the time of the sale or redemption of the financial instrument, or should it be deemed to arise at the time of the decrease in value despite the fact that the instrument remains in the investor’s portfolio all the time? The second issue to be considered by the Supreme Court will be the admissibility of a brokerage house, which is not a credit institution, accepting liability of a guarantee nature for the minimum investment performance of the client-party to an investment portfolio management agreement concluded with the brokerage house.

Particularly controversial is the question of the assessment of the damage when a financial instrument has lost value, but is still in the client’s investment portfolio. Determining the amount of damage and the very question of the existence of damage in such cases is a challenge for courts deciding claims by persons dissatisfied with the management of their investments by financial institutions.

Professor Karol Weitz, Ph.D., has been appointed as judge-rapporteur. The date for the hearing of the action has not yet been announced.

An interesting intellectual dispute of considerable importance for the market of investments in financial instruments is therefore being prepared!

The cassation appeal on behalf of the financial institution was filed by Michał Romanowski, Piotr Haiduk, Maciej Stasiewicz.

In 2021, during a protest against the so-called CT ruling on abortion, 21-year-old student Julia Landowska desperately shouted “**** ***”. A court fined her PLN 50 for violating Article 141 of the Code of Offences, which prohibits the use of obscene words in a public place. Professor Michał Romanowski, who represented Julia, appealed the verdict.

“8 out of 10 adults use vulgarities, and their use is not always indecent. It all depends on the context of the speech. Often vulgarisms are a vehicle for expression. “Je…ć PiS” became a slogan for protests in which hundreds of thousands of people participated, it became an expression of rebellion and dissatisfaction with the actions of the authorities just as the cry “Down with communism” used to be,” says Prof. Romanowski.

Last week, more than two years after the incident, a hearing was held. However, the case has not been resolved.

Prof Romanowski expresses impatience: “The case is not about 50 zloty, but it is about the right to protest, about freedom of speech and expressing opposition to the actions of the authorities. For the court, the case should be clear: the defendant admits the act, but disagrees that it is an offence. I do not want to engage in political threads, but it is worth noting that the time to resolve this case is approaching the parliamentary elections. The authorities who use the criminal law to prohibit the manifestation in public space of a critical assessment of their conduct with slogans such as ‘j**** PiS’ or ‘P******* any government’ are behaving like the authorities in totalitarian systems allowing only favourable assessments of the ruling party” .

People supporting Julia picketed in front of the court in Gdansk. They chanted “You won’t walk alone” and “It’s all about now”.

“Human rights, including the right to protest, should be upheld by an independent court. The fight for the rule of law is a fight for human rights. The executive, which is taking control of the judiciary, is doing so to control not only business and its opponents and to ensure impunity. The actions of the police – the filing of a motion to punish Yulia for protesting against the decisions of the politicised Constitutional Court 9 months after the events – shows that the authorities are ready to fight even the slightest manifestations of disobedience.” – says Prof. Michal Romanowski.

“I was lucky to have a professor representing me, without him I wouldn’t have been so bold, because after the first summonses to the police station I was terrified. “(…) Here it is no longer about the amount of the fine (…) It is about the principles of justice. In his expert report, the professor proves what those protests and that cry were about, that it symbolised the powerlessness of the young women who were fighting for their rights. Some of us got fined and paid them because, for example, they didn’t have the opportunity to travel to a court a few dozen kilometres away, others took the professor’s opinion and their cases were dropped. I hope that this will also be the case for me.” – Julia Landowska says.

The French National School of Judges and Prosecutors invited Michal Romanowski to participate in a training course for French judges, prosecutors and lawyers held in Paris on 3 and 4 July 2023.
French lawyers wanted to delve deeper into the methods an authoritarian power uses to control the judiciary, prosecution and legal profession, and what actions it uses to try to undermine the rule of law, which independent judges, prosecutors and courageous lawyers uphold together.

The training was led by, among others:

• Claire BAZY MALAURIE, President of the Venice Commission bringing together Europe’s most eminent constitutional law specialists;
• Laurent PECH, Professor of European Law, Middlesex University London, Jean Monnet Chair of Public Law, one of the professors most engaged in Europe on violations of the rule of law and human rights in Poland since 2015;
• Paweł JUSZCZYSZYN, with the participation of Hania GOUTIERRE, a French-Polish lawyer specialised in international business and very committed to defending the rule of law in Poland.
• Michał ROMANOWSKI, professor of private law at the University of Warsaw and an attorney at our law firm, attorney for Polish judges repressed by those in power.

Michał Romanowski participated in a panel with Judge Paweł Juszczyn, and independently gave a lecture entitled “Everyday life of a lawyer in the context of the limited rule of law: what is lost, what is possible, what must be faced?”.

The aim of Michal Romanowski’s lecture was to convey to leading French judges, prosecutors and lawyers through concrete examples that:
it is impossible to build a lawless state without lawyers obedient to authority;
the rule of law is not a matter of politics, but a guarantee of freedom from the fear of the governed against the governed;
an independent judge needs a free lawyer to defend the independence of the judiciary, and a free lawyer needs an independent judge to defend the freedom of the lawyer fighting for the independence of the judiciary. We all need free judges to defend our freedom against those in power;
yesterday there was Hungary, today there is Poland, and tomorrow there will be France and other countries of the European Union. It is enough to have knowledge of European history, to “read” the present and to have an imagination of what authoritarianism can lead to;
a judge, a barrister, a solicitor and a prosecutor cannot just be, but have to want to be and to be. These professions are united by an oath to uphold the law, i.e. to fight for the rule of law in defiance of those in power, whom it is the law that ‘restrains’ from subjugating the governed;
autocratic power always seeks to subjugate business according to the principle of ‘divide and rule’, i.e. to create oligarchic relations in business.

Michał Romanowski has already been invited to further training courses for French lawyers.

Professor Michał Romanowski performed at the Open’er music festival in Gdynia. Not with a guitar, but in a discussion on quotas, equality and intergenerational cooperation. The panel, which also included Dr Hanna Machińska, Paulina Kędzierska from Młodzi o Polityce and Advocate Jan Suchanek, was organised as part of the Tour de Konstytucja initiative. Michał Romanowski discussed with festival goers the importance of democracy and the importance of taking care of it, and encouraged people to vote in elections. The slogan of the Tour de Konstytucja at Open’er is “Vote for Poland”, and Michał Romanowski’s message is “Who we are is determined more by our choices than our skills” and “The future is here and now”.

A recording of the panel discussion can be viewed here: Link

A conversation with Judge Paweł Juszczyszyn and Michał Romanowski about what lawyers do at festivals: Link

The semi-final of the Young European Lawyers Contest (ERA) 2023 organised by the Academy of European Law (ERA) at the Faculty of Law of Vilnius University in Lithuania, provided a lot of excitement for both the participants and the jury. Young lawyers from 9 countries of the European Union, and among them our trainee lawyer Maksymilian Jablecki, fought to qualify for the final of the YELC 2023 competition, which will be held in Trier, Germany and the Court of Justice of the European Union in Luxembourg.

Maksymilian’s team of young lawyers from Poland, France, Estonia and Belgium defended a previously prepared written report before an international jury on the violation of fundamental rights and state responsibility under European Union law in the context of climate change and pollution disputes.

We congratulate Maksymilian and his team on advancing to the final of the YELC 2023 competition!

The entire Romanowski & Partners team is keeping its fingers crossed for Maks’ success in the November final of the YELC 2023 competition!

Prof. Michał Romanowski, as co-author of the latest edition of Systemu Prawa Prywatnego Volume 9 ‘Contract Law – Unnamed Contracts’, describes issues relevant to the investment market, including: brokerage commission agreements, relations between a brokerage house and an investor, and the liability of a brokerage house. Prof. Michał Romanowski also analyses securities underwriting agreements and sponsored issue of depositary receipts, securities derivatives agreements – option and futures contracts.

“The promotion of a non-named contract to the category of named contracts usually leads to a restriction of the principle of freedom of contract. The interpenetration and coexistence of public and private law in the sphere of economic transactions is inevitable. Private law regulation fills, as it were, with content the framework outlined by public law regulation. Public law regulation should fulfil a service role in relation to private law regulation. The problem lies not in the lack of instruments guaranteeing the protection of clients’ interests, but in the inadequate use of these instruments. The interests of clients of investment firms are (or at least should be) guarded by: FSA, courts, prosecutor’s office, President of the Office of Competition and Consumer Protection. However, some contracts should be regulated by law and be given the status of a named contract – an example of such a contract is the brokerage order contract, which is currently regulated in a fragmentary way. ‘ – says Professor Michał Romanowski.

Link.

“The decisions of the Russian Influence Investigation Commission mean potential destabilisation for business and citizens, who will spend years pursuing their rights in the courts, including compensation. But it could cause irreparable damage. On the basis of the law passed by the Sejm and signed by the President, private companies and their executives can also be summoned before the commission, as well as trade union activists, representatives of private employers’ organisations, opposition party politicians, representatives of associations and foundations helping refugees,” warns Professor Michał Romanowski in an interview with Wyborcza.

Business, in order to grow, needs good law, independent courts, stability and security. Protecting rights requires procedural safeguards such as attorney-client privilege, and the law allows the commission to waive these privileges. The only protection appears to be the determination of the unconstitutionality of the provisions of this law through diffuse constitutional review. For this we need politically independent courts and independent judges. Therefore, despite the fact that the essence of our law firm’s activity is advising businesses, we have become involved in the fight for independent courts, defending judges Igor Tuleyi, Paweł Juszczyszyn, Ewa Leszczyńska-Furtak, Ewa Gregajtys and Marzanna Piekarska-Drążek, as well as Krzysztof Krygielski, who have faced and continue to face further repression for ruling and acting against the will of the executive.

We encourage you to read the entire interview: Here.

On 23 May 2023, the third of four conferences “Regulated markets – legal, financial and market competitiveness aspects. The potential of water and energy.”

The originators of the conference are Veolia Poland, WSB Academy – WSB University and Romanowski and Partners.

The first conference was held on 24 October 2022 and enjoyed exceptional attendance and success, the second (2 March 2023) confirmed the need for such meetings. While the third (23 May 2023) further demonstrated how positive or disruptive the role of the regulator can be and the importance of the relationship between energy and water.

The uniqueness of the conference lies in the organisers’ assumption of addressing the event exclusively to private business and local governments. Its purpose is to speak out about how politicised state-regulated business is a great threat to entrepreneurs and consumers. Water and sewerage companies, as a result of the policy of the regulator Wód Polski, are struggling to maintain liquidity, while they should be investing in critical infrastructure security and development, including cooperation with the energy sector.

The biggest threat to the market economy, which is supposed to serve consumers, is not private monopolies, because these, according to the Constitution, can be broken up by an independent anti-monopoly body established under the rule of law. A danger to the market economy is a state monopoly, because such a monopoly, the state antitrust authority may not have the will to break up. An additional danger is a power-dependent regulator.

At the last conference in May, the introductory lecture entitled. “Local governments in regulated markets. Responsibility without tools’ was delivered by Professor Michał Romanowski. A panel discussion entitled. “Water – two in one – synergies of water and energy” was chaired by Adam Romanowski, partner at Romanowski i Wspólnicy.

A team consisting of: Krzysztof Zamasz, Wojciech Dmochowski, Adam Romanowski, Michał Romanowski. The developed concept goes through a creative discussion among the members of the Conference Scientific Council composed of eminent experts in the subject matter, chaired by Professor Michał Romanowski.

Many thanks to the hosts of the WSB Academy – WSB University: Rector Zdzisława Dacko-Pikiewicz, Pro-rector Marcin Lis for their hospitality and professional organisation.

We would like to thank the President of Veolia Poland, Frederic Faroche and Krzysztof Zamasz and Wojciech Dmochowski, for the joint initiative supporting private businesses and local governments that face challenges in regulated public goods markets.

A report on the conference is available here.

A summary of the conference series will take place in autumn 2023.