Investment agreement (Ruling 590)

What is an investment agreement

This is a new tax instrument that will enable an investor to determine the tax effects of an investment.

An investment agreement is an agreement concluded between an investor and the Minister of Finance with regard to the tax effects of an investment – it is intended both to guarantee to the investor the certainty in the interpretation of tax legislation and to seek a uniform and consistent interpretation of tax legislation.

The investment agreement is a new tax legislation instrument laid down in Section IIC of The Tax Ordinance, which will make it possible for the investors to conclude an agreement directly with the Minister of Finance that will cover:

• an advance pricing arrangement;
• an individual tax ruling with respect to anti-avoidance rules;
• binding excise information;
• binding rate information;
• an individual tax ruling.

The accumulation of the above legal instruments in a single instrument, the investment agreement, will make it possible for the investor to comprehensively determine how their tax  duties are to be properly performed. In this way, the investor obtains the fullest possible explanation of all the tax effects of the planned investment, established through reconciliation proceedings with the tax authority initiated at the request of the investor (or investors).

Who can apply

An application can be submitted by anyone who plans or has started an investment within the territory of the Republic of Poland worth PLN 100 million (PLN 50 million starting from 2025).

What is an investment

An investment should be understood as a new investment as defined in Article 2.1 of the New Investments Support Act. A new investment is:

1. an investment in tangible or intangible assets relating to the setting-up of a new facility, the extension of the capacity of an existing facility, diversification of the output of a facility by introducing products not previously produced by the facility or a fundamental change in the overall production process of an existing facility; or
2. the purchase of assets belonging to a facility which has closed or which would have closed had the purchase not taken place, where the assets are purchased by an undertaking that is not related to the seller and the sole acquisition of the shares in the undertaking is excluded;

Application

The application for the conclusion of an investment agreement must include:

1. particulars identifying the investor;
2. address for electronic deliveries;
3. a description of the planned or commenced investment;
4. the declared value of the investment and an explanation of how it was determined;
5. the proposed duration of the agreement;   
6. the proposed subject matter of the agreement.

Subject of the agreement

The application may be submitted in the scope of:

• an advance pricing arrangement;
• an individual tax ruling with respect to anti-avoidance rules;
• binding excise information;
• binding rate information;
• an individual tax ruling.

The subject matter scope of the application may vary, depending on the planned investment. It means that application may cover all above-mentioned instruments or just couple of them. 

Procedure

In order to agree on the scope and contents of an investment agreement, the Minister of Finance may:

• ask the investor to clarify doubts or supplement the application, including by providing a sample of the goods; or
• hold a reconciliation meeting.

Fee

Initial fee

• the initial fee is charged on the application for the conclusion of an agreement and on applications for the amendment of the agreement;
• the initial fee is PLN 50,000 – the investor is to pay the initial fee within 30 days of submitting the application for the conclusion of an investment agreement;
• the initial fee is charged from each investor, including where a joint application is filed;
• in case of refusal to conclude or to amend the agreement, the initial fee is reimbursed to the investor in full - the investor does not bear the negative consequences of the refusal to conclude or to amend the agreement.

Principal fee

• the principal fee is charged for the conclusion or amendment of an agreement;
• the amount of the principal fee is subject to arrangement and is specified in the contents of the agreement or in the contents of an amendment to the agreement - the Act only specifies the range in which the amount of the principal fee should fall (for the conclusion of the agreement the range is PLN 100-500,000);
• the investor is to pay the principal fee within 30 days from the conclusion of the agreement;
• in the case of a joint application, the principal fee is not charged from each investor (joint and several liability of investors applies).

Fee for the amendment

• the initial fee for the application for the amendment of an agreement is halved, i.e. it is PLN 25,000;
• the statutory range for the principal fee for amending an agreement is half the amount of the principal fee for entering into an agreement - the range is therefore PLN 50-250,000.

How to  pay

The fee is to be paid within 30 days from the date of submitting the application/the date of conclusion of the agreement to the account of the Ministry of Finance maintained by the National Bank of Poland.

Name of the account holder

Ministerstwo Finansów
Świętokrzyska 12, 00-916

Bank’s name:
Narodowy Bank Polski
Oddział Okręgowy w Warszawie
Address of the Bank:
Plac Powstańców Warszawy 4
00 – 950 Warszawa
Bank Account number: 10 1010 1010 0038 2522 3100 0000

Duration

• The investment agreement is concluded for a specific period as indicated in the agreement, where such period does not exceed 5 fiscal years.
• It is possible to shorten the duration of the agreement.
• The investment agreement expires by operation of law on the date of entry into force of the tax legislation provisions to the extent that the agreement has become incompatible with such provisions.
• If the period between the date of promulgation of the provisions affecting the contents of the investment agreement and the date on which they come into force is shorter than 30 days and the agreement is not amended during that period, the investor’s compliance with the agreement within the period of 30 days from the date on which such provisions come into force does not give rise to:
  • the initiation of fiscal criminal proceedings,
  • the charging of interest for late payment.

Protection for the business

The investment agreement is binding both for the investor and for the tax authorities competent for the investor’s settlements – this will give the investor a guarantee of stability in how tax legislation is applied, what is important from the business point of view.

Amending and terminating the agreement

• An application for the amendment of the agreement may be submitted at any time by both the investor and the Minister of Finance.
• An amendment of the agreement due to a change in legislation allows the investor to avoid paying the initial and principal fee due for the amendment to the agreement.
• The investor may terminate the investment agreement at any time. The agreement is terminated as at the first day of the following fiscal year.
• The Minister of Finance may terminate an investment agreement only in certain situations that are defined in the legislation.
• The investment agreement expires by operation of law on the date of entry into force of the tax legislation provisions to the extent that the agreement has become incompatible with such provisions.

Register of entities

The Minister of Finance maintains a register of investors and investment arrangements which contains the following information:

1. particulars identifying the investor;
2. the date of submission, amendment and withdrawal of the application for conclusion of an agreement, including the application for joining a new investor to the application for the conclusion of an agreement;
3. the date of conclusion of the investment agreement;
4. the duration of the agreement;
5. the date of submission, amendment and withdrawal of the application for amending the agreement, including the application for joining a new investor to the application for the amendment of an agreement;
6. the date on which the agreement is amended, including when a new investor joins the agreement;
7. the date and reason for termination of the agreement.

The register is to be made available in the Public Information Bulletin on the website of the Ministry of Finance.

Contact: centrum.obslugi.inwestora@mf.gov.pl