An order of the ultimate Court to refuse to accept the cassation complaint of the Polish improvement Fund for examination may be of fundamental importance to thousands of entrepreneurs sued for reimbursement of subsidies from the Financial Shield.
The SN explicitly challenged the key arguments that PFR has long utilized in disputes with beneficiaries of state aid. The case is systemic, the PFR has brought lawsuits against nearly 16,000 companies, even though in final judgments the courts point to the deficiency of his procedural legitimacy to search reimbursement of subsidies on a civilian road.
No PFR procedural card
The ultimate Court has confirmed that the resolutions of the Council of Ministers are not a origin of common law and cannot form the legal situation of entrepreneurs. Thus, they cannot "comply" the law or supply grounds for redress against companies.
– This is crucial due to the fact that the PFR consistently referred to the Council of Ministers' resolution and the rules of the programme, claiming that, in the absence of explicit authorisation in the Act on the strategy of improvement Institutions, they give the Fund the right to recover subsidies. The ultimate Court explicitly considered specified construction unacceptable, indicating that the resolutions of the Council of Ministers are purely interior and cannot, straight or indirectly, affect the rights and obligations of entrepreneurs. This approach is besides straight based on Article 93(2) of the Polish Constitution – says lawyer Łukasz Chacia of Karaś Chacia and Partners.
Prohibition of changing the rules after time
The second key component of the SN's position is to explicitly challenge the practice of amending or reinterpreting the rules of the programme after the payment of funds. The Court of First Instance stressed that the PFR did not have unlimited freedom to ‘precise’ the rules in specified a way as to make the situation of the beneficiaries worse, in peculiar where this led to fresh obligations which the traders could not foresee at the time of the conclusion of the contract.
The explanatory memorandum besides states that the communications, explanations or interpretations published by the PFR were purely informative and could not replace the rules or alter the content of the legal relation already established.
Higher standards on the PFR side
The ultimate Court explicitly treated the PFR, in terms of the implementation of the Financial Shield, as an entity carrying out public tasks alternatively than an average commercial law company. This means that the Fund has a higher standard of care, transparency and legality.
– The ultimate Court rejected the communicative according to which entrepreneurs would bear the full hazard of ambiguity of the program, structural errors or legislative gaps. In a state of law, the individual carrying out public tasks cannot make rights at the expense of citizens or pass on the effects of his own organisational or interpretative decisions to them,” adds the lawyer.
Good news for cantors
The provision is of peculiar importance to the cantors. The ultimate Court confirmed that the data submitted by the cantors in the subsidy applications were true, complete and from the beginning known to the PFR.
– Although the resolution is not yet definitively ending all disputes with the PFR, it clearly shows the direction of reasoning of the SN and importantly strengthens the position of entrepreneurs in ongoing and future proceedings. In addition, this shows that the dispute around the Financial Shield does not concern only accounting accounts or method interpretations of the rules of procedure, but fundamental principles of the regulation of law. In an emergency situation, this country, acting by its institutions, should guarantee that entrepreneurs have clear, unchangeable and predictable rules and not put them at hazard of imprecise regulation and subsequent explanation changes. The position of the SN clearly indicates that public aid must not be transformed into a origin of legal uncertainty and mass litigation after years. This is an crucial signal not only for thousands of companies in disputes with the PFR, but besides for future support programmes, their effectiveness and reliability depend not only on the scale of the measures, but, above all, on the assurance of entrepreneurs in the rules on which the state operates – concludes Łukasz Chacia.
