Al. Ujazdowskie 49, Warsaw Tel: or Fax:

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1 Al. Ujazdowskie 49, Warsaw Tel: or Fax: Program of the Action for Harmonizing the Polish Economy with the Requirements of the Europe Agreement Antimonopoly Office l. The Antimonopoly Office has the responsibility for implementing the provisions included in art. fi3 and 65 of the Europe Agreement, as well as for art. 8 of Protocol No 2 for ECSC (competition rules). In so far as they may affect trade between the Community and Poland, the following are incompatible with the proper functioning of the Agreement: - all agreements between undertakings, decisions by associations of undertakings and economic practices between undertakings which have as their object or effect the prevention, restriction or distortion of competition. - abuse by one or more undertakings of a dominant position in the territories of the Community or of Poland as a whole or in a substantial part thereof. - any public aid, which distorts or threatens to distort competition by favoring certain undertakings or the production of certain goods. With regard to public undertakings, and undertakings to which special or exclusive rights have been granted by the state, (for instance, public-legal entities that have been put in charge of services of special importance for a whole economy, or fiscal monopolies) may take advantage of certain privileges under the condition that their activity does not prejudice the development of trade to an extend that would prejudice the interests of the Community. 2. Meeting Poland's responsibilities in regard to provisions of the Europe Agreement.: - preparing a law on combating unfair competition. - actions for harmonizing Polish provisions in the fields of: merger control of undertakings, intellectual property rights (license, patent and know-how agreement), agreements between undertakings (co-operation agreements, exclusive distribution and supply contracts), and state aids. One of the most important issues the Office faces in the next few years is working out rules for granting state aids. This involves problems of deciding if subsidies are permitted, from the point of view of the Europe Agreement., and ensuring transparency

2 for informing the Community in the form and amount of aids. It is also necessary, to enforce provisions of the Customs Law that obliges the Antimonopoly Office to prepare an opinion in anti-dumping proceedings. The Antimonopoly Office has asked the Ministry of Foreign Economic Relations and the Main Custom Office of Tariffs to relieve the Antimonopoly Office of responsibility under the Customs Law for bring antidumping proceedings. By the end of 1993 the Antimonopoly Office together with the Directorate-General for Competition, Commission of the European Communities, will prepare a draft proposal for implementing the rules of art. 63, par. 1 and 2, and art. 65 of the treaty. At the same time, actions for harmonizing the above mentioned Polish provisions will be finished. Art. 33 (Art. 26 of the Interim Agreement) Europe Agreement The Member States and Poland shall progressively adjust any State monopolies of a commercial character so as to ensure that, by the end of the fifth year following the entry into force of this Agreement, no discrimination re- regarding the conditions under which goods are procured and marketed exists between nationals of the Member States and of Poland. The Association Council will be informed about the measures adopted to implement this objective. Art. 63 (Art. 33 of the Interim Agreement) l. The following are incompatible with the proper functioning of the Agreement, in so far as they may affect trade between the Community and Poland: (i) all agreements between undertakings, decisions by associations of undertakings and concerted practices between undertakings which have as their object or effect the prevention, restriction or distortion of competition; (ii) abuse by one or more undertakings of a dominant position in the territories of the Community or of Poland as a whole or in a substantial part thereof; (iii) any public aid which distorts or threatens to distort competition by favoring certain undertakings or the production of certain goods. 2. Any practices contrary to this Article shall be assessed on the basis of criteria arising from the application of rules of Articles 85, 86, and 92 of the Treaty establishing the European Economic Community.

3 3. The Association Council shall within three years of the entry into force of the Agreement, adopt by decision the necessary rules for implementation of paragraphs 1(iii) and related parts of paragraph a) For the purposes of applying the provisions of paragraph 1, point (iii), the Parties recognize that during the first five years after the entry into force of the Agreement, any public aid granted by Poland shall be assessed taking into account the fact that Poland shall be regarded as an area identical to those areas of the Community described in Article 92.3(a), of the Treaty establishing the European Economic Community. The Association Council shall, taking into account the economic situation of Poland, decide whether that period should be extended by further periods of five years. b) Each party shall ensure transparency in the area of public aid, inter alia by reporting annually to the other party on the total amount and the distribution of the aid given and by providing, upon request; information on aid schemes. Upon request by one party; the other party shall provide information on particular individual cases of public aid: 5. With regard to products referred to in Chapters II and III of Title III: - the provision of paragraph 1 (iii) does not apply. - any articles contrary to paragraph I (i) should be assessed according to the criteria established by the Community on. the basis of Articles 42 and 43 of the Treaty establishing the European Economic Community and in Particular of those established in Council Regulation No 26/26/ If the Community or Poland considers that a particular practice is incompatible with the terms of the first paragraph of this Article, and: - is not adequately dealt with under the implementing rules referred to in paragraph 3, or - in the absence of such rules, and if such practice causes or threatens to cause serious prejudice to the interest of the other Party or material injury to its domestic industry, including its services industry, it may take appropriate measures after consultation within the Association Council or after 30 working days following referral for such consultation. In the case of practices incompatible with paragraph 1 (iii) of this Article, such appropriate measures may, where the General Agreement on Tariffs and Trade applies thereto, only be adopted in conformity with the procedures and under the conditions laid down by the General Agreement on 7:'a.riffs and Trade and any other relevant instrument negotiated under its auspices which are applicable between the Parties.

4 7. Not with standing any provisions to the contrary adopted in conformity with paragraph 3, the parties shall exchange information taking into account the limitations imposed by the requirements of professional and business secrecy. 8. This Article shall not apply to the products covered by the Treaty establishing the European Coal and Steel Community which are the subject of Protocol No 2. Protocol No 2 Article 8 1. The following are incompatible with the proper functioning of the Agreement, in so far as they may affect. trcu3c between the Community and Poland: (i) all agreements of co-operative or concentrative nature between undertakings, decisions by association of undertakings and concerted practices between. undertakings which have as their object or effect the prevention, restriction or distortion of competition; (ii) abuse by one or more undertakings of a dominant position in the territories of the Community or of Poland as a whole or in a substantial part thereof; (iii) public aid in any form whatsoever except derogations allowed pursuant to the CCSC 'I'reaty. 2. Any practices contrary to this Article shall be assessed on the basis of criteria arising from the application of the rules of Articles of the Treaty establishing the ECSC, Article 85 of the EEC Treaty, and the roles on State aids, including secondary legislation. 3. The Association Council shall, within three years of the entry into force of the Agreement, adopt the necessary rules for the implementation of paragraphs 1 and The Contracting Parties recognize that during the first five years after the entry into force of the Agreement, and by derogation of paragraph 1(iii) of this Article, Poland may exceptionally, as regards FCSC steel products, grant public aid for restructuring purposes providing that: - the restructuring program is linked to a global rationalization and reduction of capacity in Poland; - it leads to the viability of the benefiting firms under normal market conditions at the end of the restructuring period and - the amount and intensity of such aid are strictly limited to what is absolutely necessary in order to restore such viability and are progressively reduced.

5 The Association Council shall, taking into account the economic situation of Poland, decide whether the period of five years could be ex-tended. 5. Each Party shall ensure transparency in the area of public; aid by a full and continuous exchange of information to the other Party including amount, intensity and purpose of the aid, and detailed restructuring plan. 6. If the Community or Poland considers that a particular practice is incompatible with the terms of the first paragraph amended by the fourth paragraph of this Article, and - is not adequately dealt with under the implementing rules referred to in paragraph 3 or - in the absence of such rules, and if, in cases other than export subsidies, such practice causes or threatens to cause prejudice to the interests of the other Party or material injury to its domestic industry, The affected Party may take appropriate measures if no solution is found within 30 days through consultation. Such consultation shall be held in 3O days. In the case of practices incompatible with Paragraph 1(iii) of this Article, such appropriate measures may only cover measures adopted in conformity with the procedures and under the conditions laid down by the General Agreement of Tariffs and Trade and any other relevant instrument negotiated under its auspices which are applicable between the parties. Article 65 (Art. 35 of the Interim Agreement) With regard to public undertakings, and undertakings to which special or exclusive rights have been granted, the Association Council shall ensure that as from the third year following the date of entry into force, of the Agreement, the principles of the Treaty, establishing the European Economic Community, notably Article 90, and the principles of the concluding document of the April 1990 I3onn meeting of the Conference on Security and Co-operation in Europe (notably entrepreneurs' freedom of decision) are upheld. The Contracting parties recognize that the major precondition for Poland's economic integration into the Community is the approximation of that country's existing and future legislation to that of the Community. Poland shall use Article 68 The Counteracting parties recognize that the major precondition for Poland's economic integration into the Community is the approximation of that country's existing and future

6 legislation to that of the Community. Poland shall use its best endeavors to ensure that future legislation is compatible with Community legislation Article 69 The approximation of laws shall extend to the following areas in particular: customs law, company law, banking law, company accounts and taxes, intellectual property, protection of workers at the work place, financial services, rules of competition, protection of health and life of humans, animals and plants, consumer protection, indirect taxation, technical rules and standards, transport and the environment All materials on the Commercial Law Center Foundation site are the sole property of said foundation unless otherwise noted.