Amendments to the Contracting Advantage Act adopted

On 26 October 2018, the Senate approved, without any modifications of its own, the statute amending the legislative Act regarding counteraction of unfair use of contractual advantage in trading agricultural produce and foodstuffs adopted by the lower chamber of parliament on 4 October 2018.

The amendments thus enacted include elimination of the revenue thresholds of PLN 50 mln and PLN 100 mln. This means that the Contracting Advantage Act will now apply to all commercial relations between food producers and buyers, irrespectively of the values involved; in practice, this may translate into significant expansion of the group of enterprises falling within the ambit of the Act.

The amended Act includes a simplified definition of contracting advantage. It is no longer necessary to investigate the potential existence of sufficient and actual possibilities for selling or purchasing agricultural produce to/from another purchaser/supplier; the new definition simply provides that “contracting advantage within the meaning of the act denotes existence of a significant disproportion in the economic potential of the purchaser vis a vis the supplier or of the supplier visa a vis of the purchaser”.

The new statutory provisions also expand the group of entities which may report suspected abuse of contracting advantage. Under the amended Act, “[a]ny entity may report to the President of the Office suspected application of practices which unfairly exploit contracting advantage”, and the party stepping forward with such a report benefits from guaranteed anonymity (with respect to her personal data and the contents of the report) at all stages of the resulting proceedings. The amendments also relax the requirements for immediate enforceability of decisions issued by the President of UOKiK and for auditing business enterprises for compliance with the Act.

The statute amending the legislative Act regarding counteraction of unfair use of contractual advantage in trading agricultural produce and foodstuffs is currently awaiting signature of the Polish president, whereupon it will effectively come into force a mere 14 days following its publication in the Journal of Laws (a very brief vacatio legis period).

The authors of these amendments believe that they “will positively impact on competitiveness of the economy, entrepreneurship, including the micro, small and medium-sized enterprises sector because it will serve to limit unfair commercial practices throughout the supply chain”.