On 22 April 2008, the Ministry of Treasury announced the first comprehensive plan in many years to privatise state-owned companies. The “Privatisation Plan 2008-2011” was the answer to the promise given by the Prime Minister Donald Tusk in his policy statement of 23 November 2007: “(...) There is no better protection against the political interference in the management of companies than factually increased competitiveness of Polish companies and economy. We will reach this target through wise, quick and dynamic privatisation.”

The purpose of the four-year privatisation plan prepared by the Minister of Treasury, Mr. Aleksander Grad, and consented to by the government coalition is to privatise as many companies as possible by the end of 2011. The plan has been underway for 18 months, and it had initially assumed the privatisation of 740 companies, but was later extended by virtue of the Decision of the Council of Ministers of 2 February 2009, and now it covers 802 companies. The program could be implemented because appropriate procedures were established and a number of legal solutions was adopted to simplify the privatisation process, clarify the existing shareholding structure of state-owned companies and create a basis for the Ministry to implement the program. Between 22 April 2008 and 31 October 2009, the following has been achieved:
 

Between 22 April 2008 (when the plan came into force) and 31 October 2009, the Ministry of Treasury initiated 680 privatisation projects, i.e. 84.78% of the total number of companies earmarked for privatisation. By 31 October, 173 companies (21.57%) have been successfully privatised (except for the companies in liquidation and bankrupt companies). Self-government units have taken over 17 of these companies. At the same time, 114 companies have been commercialised.

Towards the end of October 2009, the process of privatisation of 463 companies intended to be privatised in 2009-2011 has been underway. The degree of progress varies from company to company. 85 companies are being prepared for privatisation. Privatisation advisors are currently being selected for 74 companies, while pre-privatisation audits are being carried out for 136 companies, and 168 companies wait for the privatisation agreement to be signed while the relevant announcements have already been published. Moreover, 7 blocks of shares have been contributed to state-owned companies in order to increase the capital of the Industrial Development Agency (Agencja Rozwoju Przemysłu SA).
 

The revised list of key companies earmarked for privatisation in 2009-2010, prepared by the Ministry of Treasury and approved by the Council of Ministers in August 2009, includes 49 of the initial 54 companies (including 13 companies that are scheduled for privatisation by the end of 2009 and 36 companies to be privatised in 2010). The revised “Privatisation Plan 2008-2011” encompasses in the first place the energy, chemical, mining and financial sectors. Its purpose is to considerably accelerate the privatisation process and to ensure incomes for the budget during the financial crisis.
 

Total privatisation revenues (in PLN) between 1 January 2008 and 31 October 2009 amounted to approx. 8.7 billion (including the Treasury’s income from the sale of rights to PKO BP SA shares to BGK SA and cancellation of the option for purchase of Pekao shares vested in Unicredit). The amount of capital (in PLN) raised for the state-owned companies (ZA w Tarnowie-Mościcach chemical company, Enea electric energy group, LW Bogdanka hard coal company, PGE electric energy group) in the capital market through IPOs and the new issue of PKO BP shares is approx. 14 billion.

Moreover, from the beginning of 2008 until now, the Treasury’s dividend incomes (in PLN) have amounted to 10.4 billion (2.6 billion and 7.8 billion in 2008 and 2009 respectively). Although the Ministry of Treasury has expected the dividend incomes to reach PLN 11 billion in 2009, these revenues will be re-allocated for 2010, as suggested by the Minister of Finance.

The revised privatisation plan envisages that the revenues will reach PLN 37 billion within the next 18 months. Privatisation revenues (in PLN) for the period from 1 January 2009 to 31 October 2009 are nearly 6.3 billion (including the Treasury’s income from the sale of rights to PKO BP SA shares to BGK SA and cancellation of the option for purchase of Pekao shares vested in Unicredit). The second phase of privatisation of Enea SA, which was initially scheduled for 2009 was postponed until 2010. Privatisation revenues for 2008 amounted to PLN 2.37 billion against the expected PLN 2.3 billion. The sale of shares of Bank Pekao SA (August 2009, PLN 1,245.4m), PGE Elektrownia Bełchatów SA power plant (December 2008, PLN 741m), Górnośląski Zakład Energetyczny SA electric energy distributor (July 2009, PLN 658m), Vattenfall Heat Poland SA (July 2009, PLN 642m), PGE Elektrownia Turów SA power plant (December 2008, PLN 334m) and Elektrociepłownia Kraków SA heating and power plant (PLN 174m), Mondi Packaging Paper Świecie SA (PLN 167m), BZ WBK SA bank (PLN 167m), Elektrociepłownia Białystok SA heating and power plant (PLN 141m) and Bank BPH SA (PLN 67m) has brought the highest revenues to date.
 

On 30 June 2008, the Warsaw Stock Exchange saw the debut of Zakłady Azotowe w Tarnowie-Mościcach SA chemical company, which brought approx. PLN 300m. On 17 November 2008, the IPO of an energy sector company, Enea SA, was held. In such unstable financial market conditions, this issue brought approx. PLN 2 billion, which was the world’s largest IPO in the six months that had preceded it.

Because of the international financial crisis the strategy of privatisation through the stock exchange had to be modified, and the IPOs already planned had to be put on hold. Events proved this approach right, and despite the crisis 3 new successful issues were carried out in 2009. On 25 June 2009, the Warsaw Stock Exchange saw the debut of Lubelski Węgiel Bogdanka SA, which became the very first coal mine to be placed among the forty largest Polish companies listed on the Warsaw Stock Exchange. At that time, the public offering of LW Bogdanka, which gained the support of the company’s employees, was the third largest offering of a state-owned company intended to be privatised through the stock exchange after PGNiG and Enea. The total price of this offering was PLN 528m, and its success has shown that the idea of carrying out further state-owned companies IPOs was correct.

On 3 November 2009, the rights to newly issued shares of PKO Bank Polski SA were listed for the first time. In this way, the bank has increased its share capital to reassure its leadership in the Polish banking sector. The new issue, which was made possible owing to the decision of the Minister of Treasury, was the largest public offering involving the rights issue to be carried out in the Polish market since the beginning of this century. As the Ministry of Treasury has no intention of buying more shares, the rights to which the Treasury had been entitled as a holder of 51.24% of shares were sold to the BGK SA bank. The new issue brought PKO BP more than PLN 5 billion (80% of this amount will be designated for new loans).

On 6 November 2009, the Warsaw Stock Exchange saw the debut of PGE Polska Grupa Energetyczna SA, the biggest energy company in Poland and one of the largest companies in this sector in Central and Eastern Europe. The debut was the end of the first phase of the company’s privatisation, which is due to be completed in 2010. The IPO was preceded by the largest state-owned company public offering since the PKO BP debut in 2004. It was also the largest public offer in Europe in 2009. The total offering price was approx. PLN 6 billion. In 2010, the Ministry of Treasury intends to carry out the public offerings of such companies as Tauron Polska Energia SA and PZU SA.

These large issues have considerably strengthened the position of the Warsaw Stock Exchange in Europe. In Q3 of 2009, the Warsaw Stock Exchange was the second best stock exchange in Europe in terms of the number of IPOs. Capitalisation on the Warsaw Stock Exchange was higher for 6 out of 10 months in 2009 than the turnover volume of its largest competitor, the Vienna Stock Exchange. The capitalisation on the Warsaw Stock Exchange as of the end of October 2009 amounts to EUR 845 billion, exceeding the capitalisation on the Vienna Stock Exchange by EUR 3.1 billion. The Warsaw Stock Exchange has gained in the FTSE rating, and is now classified as an advanced emerging market, along with the capital markets of Taiwan, Brazil, Hungary and the Republic of South Africa, mainly because of the healthy and viable investment environment and the increased number of foreign investors.
 

The process of privatisation of the First Chemical Group is well advanced. In accordance with the guidelines set forth in the “Great Chemical Synthesis Sector Privatisation Principles” of 10 September 2008 presented by the Minister of Treasury, the main purpose of the project is effective privatisation accompanied by consolidation, i.e. forming strong chemical groups that would be able to compete in both domestic and European markets, obtaining new technologies and implementing investment programs. In October 2008, pursuant to the agreement between the Treasury and Nafta Polska SA, the latter has been authorised to carry out a joint sale of shares of Ciech SA (36.68%), Zakłady Azotowe w Tarnowie-Mościcach SA (52.15%) and ZAK SA (85%) through negotiations. Except for ZAK SA, all these companies are listed on the Warsaw Stock Exchange, and the Government’s intention is that the investors entirely take over the companies. As a result of this transaction, the potential investor should obtain synergy effects and the Treasury should gain a higher premium for a joint sale of stakes. On 26 June 2009, Nafta Polska published the invitation to negotiations (deadline: 15 September 2009) and, upon verification of initial offers, on 23 September 2009 the company informed that it had “short-listed” 6 potential investors.

The process of privatisation of Giełda Papierów Wartościowych w Warszawie SA (Warsaw Stock Exchange Joint-Stock Company) is also well advanced. In accordance with the principlesadopted on 2 April 2009, the four leading industry investors (Deutsche Boerse, London Stock Exchange, NASDAQ OMX and New York Stock Exchange Euronext) were invited to submit offers to purchase 73.82% shares of the Warsaw Stock Exchange. All investors submitted their offers by 19 June 2009, and the offers have been qualified to the second phase after they were positively assessed for compliance with the formal requirements. The deadline for submitting the final offers was 6 November 2009. Deutsche Börse offered to purchase the majority stake of the Warsaw Stock Exchange shares, while Pekao SA and Banco Espiriti Santo de Investimento offered to purchase shares allotted for the Warsaw Stock Exchange members. The negotiations will commence once the formal analysis and the analysis of the merits of the bid have been completed. The privatisation is expected to be completed within 2-3 years.

Also advanced is the process of privatisation of pharmaceutical companies, carried out primarily by the Polish Pharmaceutical Holding (Polski Holding Farmaceutyczny). In 2009, the Polish Pharmaceutical Holding intends to sell 85.04% of its shares held in Polfa Pabianice SA.
 

Altogether, 74 state-owned minority stakes have been sold since the beginning of this term (38 stakes from the beginning of 2009), including 14 stakes in listed companies, thanks to the growth trend on the Warsaw Stock Exchange (12 stakes from the beginning of 2009). As far as the key companies are concerned, BZ WBK SA, BPH SA, Bank Handlowy w Warszawie SA, Mondi Packaging Paper Świecie SA, Pekao SA, Budimex SA, Grupa Kęty SA and WPEC w Legnicy SA have been successfully privatised.
 

After many months of negotiations, Ministry of Treasury has reached the agreement with Eureko BV on PZU SA, reaching all strategic targets that were established prior to negotiations. The agreement has brought the nearly ten-year-old dispute over the privatisation of PZU SA to an end. Previous governments were unable to solve the dispute. The Minister of Treasury has taken measures that led to successful completion of negotiations and strengthening Poland’s position as a negotiator. As a result, the Treasury has regained control over the insurance company having strategic importance for Poland, and Eureko BV will ultimately withdraw from PZU SA. At the same time, Eureko BV shall withdraw its compensation claims against the Treasury, the amount of which was estimated by Eureko to be around PLN 36 billion. Among other things, the agreement will have the following benefits for the Treasury:

         Eureko BV will withdraw its claims against the Treasury of the Republic of Poland and PZU SA, including the withdrawal of arbitration claims;

 

·         Eureko BV will agree to give up its rights of a strategic investor in PZU SA;

 

·         Eureko BV will agree to reduce its share in PZU SA to 23% immediately, 18% after the IPO, and ultimately to the level below 13%;

 

·         Eureko BV will agree to refrain from entering the competition against PZU SA for 3 years from the date of reducing its share in the company below 13%;

 

·         Eureko BV will agree not to increase its share capital in PZU SA for 15 years;

 

·         Eureko BV will waive its individual rights in PZU SA, which were granted pursuant to the existing agreements and articles of association;

In return for the consent to the abovementioned provisions set forth in the agreement, Eureko BV became entitled to receive the amount of PLN 3.550 billion as a dividend for usufruct of Treasury’s shares and the amount of PLN 1.224 billion as the guaranteed amount in the settlement of profits from the sale of 4.9% of PZU SA shares during the IPO. These conditions should be compared to what would happen if the agreement had not been reached. With Poland having lost the arbitration, Eureko BV could have gained full control over PZU SA through the purchase of 21% of shares, in addition to the 33% already in its possession (thereby earning approx. PLN 6 billion as a result of share price difference between 2001 and 2009), while the payment of claim from the Polish budget to Eureko BV would amount to PLN 36 billion.

 

Payments for the benefit of Eureko will not be financed by the state budget, and the releasing of the blocked dividend has a beneficial effect for the Treasury, as it will bring approx. PLN 3.4 billion to the budget this year. Another beneficial effect of the agreement for the Polish market is the mutual consent of the parties to the public share purchase offer and the debut of PZU SA on the Warsaw Stock Exchange as soon as it is reasonably possible. The intention of the Ministry of Treasury is to carry out the entire process in 2010, or, should the date be inconvenient, not later than by the end of 2012. The public offer will be made under supervision of the Treasury. The agreement is therefore in keeping with the strategic target established by the Ministry of Treasury to make PZU SA a strong financial institution listed on the Warsaw Stock Exchange, with the decision-making centre in Poland. Ending the dispute by means of a shareholders’ agreement helps maintain Poland’s credibility as a reliable partner in terms of international economic relations.

 

The Minister of Treasury coordinates the liquefied natural gas (LNG) terminal in Świnoujście pursuant to the Decision of the Council of Ministers of 19 August 2008. The Decision defines the project as compliant with Poland’s strategic interests. On 8 October 2008, the extraordinary shareholder meeting of PGNiG SA gave its consent for the sale, without opening the tender procedure, of 100% shares of Polskie LNG Sp. z o.o. with registered office in Świnoujście to a state-owned company Operator Gazociągów Przemysłowych Gaz-System SA that is not scheduled for privatisation.  After extensive negotiations with Qatar, which is the world’s largest LNG exporter, held since spring 2008 by the Prime Minister, Minister of Treasury and PGNiG representatives, on 29 June 2009, Minister Grad and Qatar’s Deputy Prime Minister and the Minister of Energy and Industry, Mr. Abdullah bin Hamad Al-Attiyah, took part in the meeting held in Qatar, where the final agreement for LNG supplies to Poland was concluded between PGNiG SA and QatarGas. On 15 April 2009, the companies signed a Framework Agreement, specifying the terms and conditions of the final agreement, and in early June the crucial stage of negotiations has been completed. As a result, the deadline for concluding the final agreement was fixed at 30 June 2009. The Minister of Treasury agreed for the conclusion of the agreement that was approved by PGNiG management and supervisory boards on 19 June and 22 June 2009 respectively.

 

The agreement for gas supplies from Qatar – the first long-term contract since the “Yamal Contract” – has considerably increased Poland’s energy security. The duration of the agreement is 20 years (2014-2034). Under the agreement, QatarGas will supply PGNiG with 1m tons of LNG per year (ca. 1.5 billion cubic meters). The gas will be delivered to the gas terminal in Świnoujście using new generation Q-Flex carriers with a capacity of 216,000 cubic meters. The first supply will be delivered between June and December 2014. Additional LNG supplies will be delivered by PGNiG pursuant to short-term contracts (ca. 1 billion cubic meters) depending on the market demand. The Parties agreed that the supply volumes may be increased.

 

There is a strong link between the date of initiating gas supplies from Qatar and the schedule of construction by OGP Gaz-System SA and its daughter-company Polskie LNG of the LNG terminal in Świnoujście, which is expected to meet up to one-third of Poland’s demand for gas. This project, being one of the largest investments in Poland’s infrastructure, should be completed in 2014. In order to ensure that the investment is timely completed, the Ministry of Treasury prepared a special act allowing to accelerate the terminal construction by simplifying and shortening the public procurement procedure pursuant to recommendations of the Council of Ministers of 13 January 2009. The Act of 24 April 2009 concerning the investments in LNG regasification terminal in Świnoujście came into force on 4 June 2009.

 

On 6 August 2009, Polskie LNG announced the main contractor selection procedure, with 30 September 2009 as the deadline for submitting motions. Prior to that, environmental decisions had to be made, and the permit for construction works was obtained on 15 July 2009. Altogether, 25 companies comprising 8 consortia decided to participate in the tender. From this group, 4 consortia will be selected, which will submit their preliminary offers by the end of December 2009, and the contractor will be selected by mid-2010. OGP Gaz-System received loan offers from a dozen Polish and foreign banks. This long-term contract for gas supplies from the Middle East is one of the most important steps to diversify gas supplies to Poland. It also means that the diversification, which has been considered crucial for Poland’s energy security for a very long time, has become reality.

 

In December 2008, the Ministry of Treasury entered negotiations with the shipyard’s owner (ISD, a company registered in Ukraine) concerning the restructuring program. The negotiations led to the adoption, on 5 December 2008, of a detailed, long-term plan which guaranteed that the shipyard’s activity would not discontinue, a minimum number of 1900 employees would be employed, and the shipyard’s manufacturing activities would continue to secure the minimum output of 22,000 tons of steel. In May 2009, the plan was revised. Permanent economic viability and free market competitiveness warranties were added as well as the new regulations concerning steel structures, wind turbines, slipways and the investor’s own outlays. The Ministry of Treasury also caused further public aid in the amount of PLN 150m to be granted for the shipyard and basic social security to be granted for the shipyard’s workers. On 22 July 2009 the European Commission approved the shipyard restructuring plan and declared that granting public aid for the shipyard after Poland’s accession to EU had been legal.

 

The sale of shipyards assets was possible when the so-called Special Shipyards Act (i.e. the Act of 19 December 2008 concerning the Compensation Proceedings Regarding the Entities of Special Importance for the Polish Shipbuilding Industry) was adopted. During the tender for the sale of the shipyards assets, which was carried out under the said Act in May 2009, an investor declaring interest in the continuation of shipbuilding activities was selected. The agreement was concluded between the investor and the Ministry of Treasury on 28 May 2009, and the bid security (deposit) of approx. PLN 40m was accepted on account of the price. Before the bid security was paid and the special company was established, the investor had for months carried out talks and activities leading to the purchase of the shipyards, as well as preparatory projects related to the resuming of shipbuilding operations.

 

The amounts for the asset components bidden by the investor were not transferred by 31 August 2009 (the date of expiry of the European Commission consent for the sale of the shipyards assets). It was clear that, because of the investor’s failure to complete the transaction, the bid security (PLN 36,141,835) loss procedure had to be initiated.

 

According to the European Commission’s decision of 8 September 2009 allowing Poland to extend the deadline for completion of the compensation proceedings regarding the investments until 31 December 2009, the Compensation Administrator took measures to carry out the new sale of assets pursuant to the so-called Special Shipyards Act concerning the asset components of Stocznia Gdynia SA and Stocznia Szczecińska Nowa Sp. z o.o. that were not purchased. Therefore, the bidding procedure will be repeated, and the shipyards assets’ buyers will be known by the end of 2009.

The most significant legal changes introduced in order to unblock the process of privatisation are amendments to the Commercialisation and Privatisation Act of 19 December 2008 which were prepared by the Ministry of Treasury (introducing changes in the Commercialisation and Privatisation Act and the act on the principles of acquisition of shares from the Treasury in the consolidation process of energy sector companies). The Act established a general principle of openness in privatisation processes, a good example of which is a publicly available Privatisation Charter. It is also instrumental to local authorities, as it facilitates the process of taking over the responsibility for those of the State-owned companies which carry out tasks set forth by local authorities and thereby also improves the management of such companies. Due to these amendments, the number of employees authorised for a free-of-charge acquisition of shares from a 15% pool was increased, affecting a total of around 100,000 workers employed in the energy sector, including several thousand employees of PGNiG gas company and RUCH press distributor.

Amendments to the Commercialisation and Privatisation Act bring in improvements in the privatisation process by introducing a new privatisation method (public auction), simplifying the regulations governing the preparation of analyses, and authorizing the sale of shares on a regulated market without requiring the consent of the Council of Ministers. The project of the Ministry of Treasury also included amendments to the so-called Salary Cap Act which was not included in the final draft of the document due to a presidential veto. On 11 April 2008 the draft amendments were referred to the Council of Ministers. On 13 June 2008 the bill was passed by the Parliament and on 26 June 2008 approved by the Senate without amendment thereto. The presidential veto of 24 July 2008 significantly delayed the implementation of changes which were supposed to expedite the privatisation process. Containing the amendments of 19 December 2008, the Act finally came to force in 12 February 2009. Work is currently in progress to further amend the Act, the new version of which is due in January 2010.  

Apart from the Commercialisation and Privatisation Act, other major acts passed by the Parliament include the Act of 19 December 2008 concerning the Compensation Proceedings Regarding the Entities of Special Importance for the Polish Shipbuilding Industry and the Act of 24 April 2009 concerning the investments in LNG regasification terminal in Świnoujście. A new draft of the Act on corporate governance is also under preparation. In November 2009, the Council of Ministers adopted a bill regulating the powers of the Minister of Treasury and the exercise of such powers in certain companies or groups of companies operating in the sectors of oil, liquid fuels and energy.

2. Other significant acts

VI. COMPENSATION

1. Compensation payments for real estate left outside the present borders of Poland.

Since the beginning of the process of compensation payments until October 2009, Bank Gospodarstwa Krajowego has made a total of 22,468 compensation payments amounting to a total of PLN 967,606,002.10, using the funds available from the Compensation Fund. Over the last two years (from January 2007 till the end of October 2009) a total of PLN 193,000,000 was disbursed as compensation granted under binding court judgments and final administrative decisions. On 14 October 2008, an integrated record management system (SIR) was launched at the Ministry of Treasury. Covering the central and provincial records, the system enabled the Ministry to obtain significantly more data relating to persons entitled for compensation and thus expedite the payment of compensation.

2. Compensation Act

The aim of the Compensation Act is to remedy the losses suffered by the former owners due to the process of nationalisation under decrees of the Polish Committee of National Liberation (PKWN) issued between the years 1944-1962, and the acts passed by the parliament of the People’s Republic of Poland. Persons entitled to compensation are former owners who held Polish citizenship at the time when their property was seized by the state or their heirs. The provisions of the Act will be implemented in the form of financial compensation. Transfer of property rights will also be possible in which case the amount of the awarded compensation may be credited towards the price of the property. Pursuant to the applicable regulations, former owners or their heirs may either seek equitable relief or seek to exercise their right for compensation or property restitution by way of court or administrative proceedings. The bill on compensation payments is currently reviewed by the Standing Committee of the Council of Ministers and is subject to arrangements with respect to the sources of financing specified therein.

 

VII. TRANSPARENCY AND DEPOLITICISATION OF CORPORATE SUPERVISION

1. New criteria of appointment of supervisory board members.

Pursuant to the ordinances prepared by the ministry of Treasury (Ordinance of the Minister of Treasury no. 45 dated 6 December 2007 and Ordinance of the Minister of Treasury no. 20 dated 30 June 2008), representatives of the Treasury on supervisory boards are selected in open competition procedures. For the first time ever, the criteria for the selection of candidates for supervisory boards of state-owned enterprises are regulated by an ordinance based on the principles of corporate governance. The appointment procedure is open and transparent. The commencement of the process and the results of the first and final stages are presented on the website of the Ministry of Treasury, www.msp.gov.pl.

2. Transparency of corporate governance

Preparations to expedite the process of privatisation consisted in addressing the issues in the state-owned enterprises and reorganizing their existing ownership structure. One of the prerequisites for a successful privatisation is effective governance which creates conditions for restructuring and enables a company to compete in the European and global markets. Additionally, the Ministry of Treasury has significantly reduced the number of companies included in the so-called list of strategic companies. 

A good example of an area where successful corporate governance was introduced is the energy sector. In this respect, key measures included preparation of Development Strategies by energy groups, transfer of the assets of power transmission networks to the Transmission System Operator (providing PSE Operator with the necessary resources), transfer of the assets of the so-called area companies (spółki obszarowe) to PSE Operator, arrangements for the construction of an energy bridge between Poland and Lithuania (a power transmission line connecting Polish and Lithuanian power transmission systems), handing over to PSE Operator the so-called trans-border transmission lines in order to ensure operational safety of the National Power System, and finalising the process of unbundling of transmission system operators within PGE and Energa Operator. Additionally, PGE was tasked by the Polish government with a mission to build by the year 2020 two nuclear plants with a total capacity of 6000 MW.

 

VIII. ORGANISATIONAL ISSUES

In order to successfully implement the privatisation program, a number of employees of the Ministry of Treasury were transferred to organisational units directly and indirectly involved in privatisation processes. This task was implemented through changing of the organisational structure in the Ministry, internal redeployments, taking on new staff in the scope necessary to ensure proper operation of the Ministry, and performing a critical review of the measures implemented to date with respect to privatisation process. Internal redeployment and the use of budget reserve to create new job posts enabled the Ministry to increase the number of persons directly and indirectly responsible for privatisation processes. Structural changes at the Ministry of Treasury involved liquidation, in 2007, of two organisational units and setting up two new bodies – Department of Privatisation Projects (DPP) and Public Relations Office (BKS). DPP developed and implemented a new project-based privatisation methodology thereby significantly increasing the transparency of respective privatisation processes. BKS directs its efforts towards a broadly understood promotion of privatisation activities among prospective investors and the general public.

 

IX. MINISTRY OF TREASURY’S OPENNESS TO INVESTORS AND THE PUBLIC OPINION

1. Promotion of privatisation among investors

The global economic crisis resulted in lower interest in Polish companies. It was especially caused by a slump in the stock exchange. The Ministry of Treasury therefore decided to take the active approach and to seek investors. Since 2008, on the Ministry’s new website there is a special sub-site intended for investors. Also, as of July 2009, an Investor Relations Centre has been operating. The centre’s goal is to assist potential investors in obtaining information on the privatization process and to facilitate contact with the representatives of the Ministry responsible for individual projects.

The Privatisation Plan is regularly presented to potential investors during private and group meetings organised at the Ministry of Treasury, as well as during foreign trips of the Ministry’s executives. Those events have included meetings with Open Pension Funds and Private Equity funds, organised at the Ministry of Treasury. Additionally, since 2008, investor trips of the Minister of Treasury, so called road shows, have been organised. Up to date, the Minister has held meetings with investors from London, Saudi Arabia, Qatar, Kuwait, United Arab Emirates, Japan, and Singapore.

2. Privatisation Charters

The Privatisation Charters published on the website of the Ministry of Treasury contain all information regarding each of the Treasury’s companies subject to privatisation. The Privatisation Charters also inform who, for what price and as part of what obligations, participated in individual companies’ privatisation. The goal of the Privatisation Charters is to ensure that the privatisation processes are as publicly accessible and transparent as possible.

3. Educational activities of the Ministry of Treasury concerning private property and privatisation

Since 2008, the Ministry of Treasury has carried out educational activities aimed at disseminating knowledge on privatisation and private property, as well as at increasing public awareness of the positive effects of privatisation and its influence on the development of the community and economy of Poland. These activities are carried out in cooperation with non‑government organisations and are addressed to various target groups: pupils, university students, senior citizens, local journalists, religious groups, local community and opinion leaders.

In 2008, a pilot edition of the competition “Property equals responsibility” confirmed a need for this type of educational projects and, thus, the scale of activities carried out in 2009 was increased (altogether 13 competitions were announced in 2009). As part of the competitions, various educational activities are carried out in cooperation with 15 non-government organisations. In one such project enjoying highest popularity – the competition of AD REM privatisation debates, 79,500 students and 1,312 teachers from 904 schools participated.

Between 2008 and 2009, a total of 70 educational projects were implemented in cooperation with 22 non-government organisations. More than 80 thousand people, from approximately 1,000 schools, participated in the projects. Also, 4 privatisation publications, 11 sponsored press supplements were published, and 7 instalments of a TV program were filmed.