Since 2019, Polish tax regulations proposed by the Ministry of Finance impose responsibility for non-arm’s length conditions of intragroup transactions directly on members of management boards. By the end of the 9th month after the fiscal year-end, each member of a management board is obliged to submit a statement and confirm that all material transactions concluded with related parties by the Polish entity are in line with the arm’s length principle. Failure to submit the statement or negligent misrepresentation (e.g., where the statement is proved to be untrue) may trigger imposing personal penalties of a maximum value of 5 million € on each member of the board. The irrevocable obligation to file the statements causes many practical hurdles, which will be discussed in this article.
