Bourse debut blocked

President Lech Kaczyński has effectively blocked plans to privatize the Warsaw Stock Exchange by not signing a legislative act which would have enabled the bourse to pay out dividends. The president has instead sent the act to the Constitutional Tribunal in order to assess whether its tenets agree with constitutional law.

The act on returns was the last of three acts needed to implement the EU's Markets in Financial Instruments Directive (MiFID), the law which harmonizes investment regulations for European Economic Area countries (EU members plus Iceland, Liechtenstein and Norway). Poland is already supposed to have implemented MiFID and faces EU fines if it does not.

"The situation means that it is necessary to take a break in the realization of our plans to privatize the WSE and return to them when the act on returns can be implemented," Deputy Treasury Minister Michał Chyczewski told Parkiet.

"We're counting on the Constitutional Tribunal to address the act as soon as possible," he said. Chyczewski added that taking part in acquisitions of other regional stock markets would be out of the question as long as the bourse remained fully state-owned.

Nevertheless, the WSE has announced a plan to take part in the privatization of the Prague Stock Exchange. The Warsaw exchange had been involved in preliminary talks with the PSE, but was excluded from advanced negotiations because it is controlled by the state.

"We've decided to make an offer for shares of the bourse in Prague. We will make this offer outside the [official privatization] process, because we can't take part in this process for technical reasons," Ludwik Sobolewski, president of the WSE, told Radio PiN last week.

"I can't imagine that the Warsaw exchange, which aspires to be an important bourse in the region, could do otherwise," he concluded.