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Ease of Doing Business in

Poland

Poland Download Profile (1765KB, pdf)
Region OECD high income
Income Category High income
Population 37,999,494
GNI Per Capita (US$) 13,370
City covered Warsaw

190

1

DB 2017 Rank

1

100

DB 2017 DTF (% points)

  • local_library
  • group
Topics DB 2017 Rank DB 2016 Rank info_outline Change in Rank DB 2017 DTF (% points) info_outline DB 2016 DTF (% points) info_outline Change in DTF (% points) info_outline
Overall 24 25 up
1
77.81 77.04 down
0.77
Starting a Business 107 102 down
5
84.22 84.18 up
0.04
Dealing with Construction Permits 46 52 up
6
75.15 74.24 up
0.91
Getting Electricity 46 48 up
2
81.35 80.15 up
1.20
Registering Property 38 36 down
2
76.49 76.90 down
0.41
Getting Credit 20 19 down
1
75.00 75.00
-
Protecting Minority Investors 42 40 down
2
63.33 63.33
-
Paying Taxes 47 44 down
3
82.73 82.77 down
0.04
Trading across Borders 1 1
-
100.00 100.00
-
Enforcing Contracts 55 56 up
1
63.44 63.44
-
Resolving Insolvency 27 33 up
6
76.37 70.43 up
5.94

Positive= Doing Business reform making it easier to do business.Negative= Change making it more difficult to do business.

DB 2017 Rank:

27

DB 2016 Rank:

33

Change in Rank:

up6

DB 2017 DTF (% points):

76.37

DB 2016 DTF (% points):

70.43

Change in DTF (% points):

up5.94

Indicator Poland OECD high income
Recovery rate (cents on the dollar) info_outline 60.6 73.0
Time (years) info_outline 3 1.7
Cost (% of estate) info_outline 15 9.1
Outcome (0 as piecemeal sale and 1 as going concern) info_outline 1 ..
Strength of insolvency framework index (0-16) info_outline 14 12.1
  • Indicator Explanation Answer
    Recovery rate (cents on the dollar) 60.6
    Proceeding Under Article 21 of the Law on Bankruptcy and Reorganization, debtor's management is obligated to file for bankruptcy within 2 weeks of the date when the debtor becomes insolvent. Although the bankruptcy law has provisions on reorganization, in practice, such proceedings are very rare and most bankruptcy cases are resolved through liquidation. Once the hotel management commences bankruptcy proceedings, the judge will have to decide whether to proceed with liquidation or with reorganization. The judge will most likely order the opening of liquidation proceedings. After the reform in January 2016, a few cases have been filed under the new restructuring proceedings, which are likely to become more common in the future. liquidation
    Outcome Because the value of an operating hotel is higher than selling its assets piecemeal, it is most likely that BizBank and Mirage management will agree that it is in both of their best interest for the hotel to continue operating, which will enable sale as a going concern. going concern
    Time (in years) It will take 2-3 weeks for Mirage to prepare the bankruptcy application. After the application is submitted, it will take approximately 2 months for the court to appoint the judges and for the judges to review the case and issue a declaration of bankruptcy. After the declaration is issued, it must be published in the official gazette and at least one local newspaper (14 days). After the announcement is published, it may take up to 2 months to hold the first hearing with all the creditors present. The participants are likely to agree that the hotel should continue operating and the court will appoint an administrator to supervise the operations (up to 2 months). The creditors will then submit their claims to the administrator, who will prepare a list of creditors to be approved by the court. This process can take up to 11 months. After that, the court will likely decide that the company should be liquidated and will appoint a liquidator (up to 4 months). The liquidator must inventory and appraise the assets, which is a lengthy procedure and may take up to a year, because all participants can express opinions on the value of the assets and several appraisers may need to be hired to satisfy the objections of the debtor and creditors. After all the assets are appraised, the liquidator will organize an auction for the sale of assets. Usually, at least two auctions will take place, because most buyers will wait for the second auction, as the price at the second auction will be dropped by 30%. That is why this process of auctioning off the assets may take up to 4 months. BizBank can receive its portion of the sale proceeds within 30 days of the sale. The time estimates may change when the new restructuring proceedings become more common. 3.0
    Cost (% of estate) The costs will depend on how disputed the insolvency claims are. Attorneys' fees will be one of the main expenses (3-6%), as well as fees of the administrator (3%), auctioneer (1%) and other professionals involved in the insolvency proceedings (5-7%). 15.0
    Answer Score
    Strength of insolvency framework index (0-16) 14.0
    Commencement of proceedings index (0-3) 3.0
    What procedures are available to a DEBTOR when commencing insolvency proceedings? (a) Debtor may file for both liquidation and reorganization 1.0
    Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor? (a) Yes, a creditor may file for both liquidation and reorganization 1.0
    What basis for commencement of the insolvency proceedings is allowed under the insolvency framework? (c) Both (a) and (b) options are available, but only one of them needs to be complied with 1.0
    Management of debtor's assets index (0-6) 6.0
    Does the insolvency framework allow the continuation of contracts supplying essential goods and services to the debtor? Yes 1.0
    Does the insolvency framework allow the rejection by the debtor of overly burdensome contracts? Yes 1.0
    Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0
    Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0
    Does the insolvency framework provide for the possibility of the debtor obtaining credit after commencement of insolvency proceedings? Yes 1.0
    Does the insolvency framework assign priority to post-commencement credit? (b) Yes over ordinary unsecured creditors but not over secured creditors 1.0
    Reorganization proceedings index (0-3) 3.0
    Which creditors vote on the proposed reorganization plan? (b) Only creditors whose rights are affected by the proposed plan 1.0
    Does the insolvency framework require that dissenting creditors in reorganization receive at least as much as what they would obtain in a liquidation? Yes 1.0
    Are the creditors devided into classes for the purposes of voting on the reorganization plan, does each class vote separately and are creditors in the same class treated equally? Yes 1.0
    Creditor participation index (0-4) 2.0
    Does the insolvency framework require approval by the creditors for selection or appointment of the insolvency representative? No 0.0
    Does the insolvency framework require approval by the creditors for sale of substantial assets of the debtor? Yes 1.0
    Does the insolvency framework provide that a creditor has the right to request information from the insolvency representative? No 0.0
    Does the insolvency framework provide that a creditor has the right to object to decisions accepting or rejecting creditors' claims? Yes 1.0

Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”.