The law of languages
"Where one of the parties to a contract to be performed in Poland is a Polish subject, such contract shall be drawn up in the Polish language"
- Art. 8(1) Polish Language Act.
Businesses operating in Poland, both domestic and foreign, are all too aware of the risk of executing an agreement in a foreign language without an accompanying Polish version, as provided for by the Polish Language Act (the "PLA"). The failure to prepare a Polish version of an agreement will, at the very least, create confusion as to the intended meaning of a particular provision, and even worse, lead to the contract being declared unenforceable by a local judge in the event of a dispute between the parties. Recently, the following question has been raised: Does the PLA violate EU law? The short answer is yes, but only in part. Much of the PLA will survive and continue to apply long after Poland joins the EU.
At present, the scope of the PLA applies to both the public and private sectors. In the public sector, for instance, State and local officials are required to perform their official acts in Polish. The same is true for teachers in both public and private schools, unless of course the school is a foreign language school. In the private sector, in addition to the requirement that all contracts be accompanied with a Polish version if at least one of the parties to the contract is a Polish subject and such transaction is to be performed in Poland, the PLA requires the use of Polish in the names of goods and services, offers, advertisements, instruction manuals, terms of guarantees, invoices, bills and receipts.
What is the penalty for violating these Polish language requirements? With respect to commercial contracts, if additional written evidence is not produced (in Polish) to verify the intent of the parties to a foreign language contract, such as letters or emails between the parties that would tend to prove the understanding of the parties, the contract will almost certainly be deemed to be unenforceable. A court will not rely on the existence of a foreign language contract to prove the existence of a 'legal act', nor will the court merely rely on the testimony of the parties, unless both parties agree or the contract applies to the provision of services by electronic means concluded with a foreign service provider. With regard to the sale of goods and services, advertising and the issuance of invoices, for example, the failure to prepare Polish language versions will be subject to the imposition of a monetary fine. In addition to a fine, the amount of which is not defined in the PLA, the offending party may be required to make a 'contribution' of up to zł.100,000 to the National Fund for the Promotion of Creative Activity.
Any exceptions to the scope of the PLA? Yes. For instance, proper names and commercial names do not have to be translated into Polish. So, for instance, the InterContinental Hotel can advertise itself as the InterContinental, as opposed to calling itself the MiędzyKontynentalny. Foreign language newspapers are also exempt, as are foreign magazines, books and computer programs. But, the instruction manual that comes whith your new software program must be in Polish. Other exemptions exist, including the use of foreign trademarks and customarily used scientific and technical terminology.
What effect will EU accession have on the PLA? And how exactly does the PLA violate EU law? Currently, the Sejm is considering several amendments to the PLA in order to comply with the aquis communautaire, the body of EU law. In general, and I realise some of my colleagues make take issue with me here, the PLA provisions regarding the private sector will need to be amended and, in some cases, deleted, in order to comply with EU law. One of the EU's basic tenets is the free movement of goods, people and capital. The PLA, if not amended, will inhibit the free movement of goods, people and capital by forcing EU investors to always prepare Polish versions of agreements when contracting with Polish subjects. Specifically, the EU Commission, in its recently released Comprehensive Report on Poland's Preparation for Membership, accused the Polish Language Act of creating an unjustified trade barrier.
Depending on the final wording of the amendments currently being considered by the Sejm, it is expected (or should I say hoped) that the final version of the draft amendments will permit the recognition and enforcement of foreign language contracts in Poland without the need to prepare Polish versions, at least with respect to contracts entered into between two commercial entities. Moreover, it is anticipated that the Polish language requirement regarding the sale and advertising of goods and services will continue to apply, but on a more limited basis, namely with respect to consumer sales, and will no longer be applicable to commercial transactions.
Paul Fogo is a senior attorney with Miller, Canfield, W. Babicki & Partners.
- Art. 8(1) Polish Language Act.
Businesses operating in Poland, both domestic and foreign, are all too aware of the risk of executing an agreement in a foreign language without an accompanying Polish version, as provided for by the Polish Language Act (the "PLA"). The failure to prepare a Polish version of an agreement will, at the very least, create confusion as to the intended meaning of a particular provision, and even worse, lead to the contract being declared unenforceable by a local judge in the event of a dispute between the parties. Recently, the following question has been raised: Does the PLA violate EU law? The short answer is yes, but only in part. Much of the PLA will survive and continue to apply long after Poland joins the EU.
At present, the scope of the PLA applies to both the public and private sectors. In the public sector, for instance, State and local officials are required to perform their official acts in Polish. The same is true for teachers in both public and private schools, unless of course the school is a foreign language school. In the private sector, in addition to the requirement that all contracts be accompanied with a Polish version if at least one of the parties to the contract is a Polish subject and such transaction is to be performed in Poland, the PLA requires the use of Polish in the names of goods and services, offers, advertisements, instruction manuals, terms of guarantees, invoices, bills and receipts.
What is the penalty for violating these Polish language requirements? With respect to commercial contracts, if additional written evidence is not produced (in Polish) to verify the intent of the parties to a foreign language contract, such as letters or emails between the parties that would tend to prove the understanding of the parties, the contract will almost certainly be deemed to be unenforceable. A court will not rely on the existence of a foreign language contract to prove the existence of a 'legal act', nor will the court merely rely on the testimony of the parties, unless both parties agree or the contract applies to the provision of services by electronic means concluded with a foreign service provider. With regard to the sale of goods and services, advertising and the issuance of invoices, for example, the failure to prepare Polish language versions will be subject to the imposition of a monetary fine. In addition to a fine, the amount of which is not defined in the PLA, the offending party may be required to make a 'contribution' of up to zł.100,000 to the National Fund for the Promotion of Creative Activity.
Any exceptions to the scope of the PLA? Yes. For instance, proper names and commercial names do not have to be translated into Polish. So, for instance, the InterContinental Hotel can advertise itself as the InterContinental, as opposed to calling itself the MiędzyKontynentalny. Foreign language newspapers are also exempt, as are foreign magazines, books and computer programs. But, the instruction manual that comes whith your new software program must be in Polish. Other exemptions exist, including the use of foreign trademarks and customarily used scientific and technical terminology.
What effect will EU accession have on the PLA? And how exactly does the PLA violate EU law? Currently, the Sejm is considering several amendments to the PLA in order to comply with the aquis communautaire, the body of EU law. In general, and I realise some of my colleagues make take issue with me here, the PLA provisions regarding the private sector will need to be amended and, in some cases, deleted, in order to comply with EU law. One of the EU's basic tenets is the free movement of goods, people and capital. The PLA, if not amended, will inhibit the free movement of goods, people and capital by forcing EU investors to always prepare Polish versions of agreements when contracting with Polish subjects. Specifically, the EU Commission, in its recently released Comprehensive Report on Poland's Preparation for Membership, accused the Polish Language Act of creating an unjustified trade barrier.
Depending on the final wording of the amendments currently being considered by the Sejm, it is expected (or should I say hoped) that the final version of the draft amendments will permit the recognition and enforcement of foreign language contracts in Poland without the need to prepare Polish versions, at least with respect to contracts entered into between two commercial entities. Moreover, it is anticipated that the Polish language requirement regarding the sale and advertising of goods and services will continue to apply, but on a more limited basis, namely with respect to consumer sales, and will no longer be applicable to commercial transactions.
Paul Fogo is a senior attorney with Miller, Canfield, W. Babicki & Partners.
