24 Poland

Subject(s):

Banks and cross-border issues — Liquidated and unliquidated monetary obligations — Contractual set-off — Insolvency set-off — Judicial set-off

This chapter provides an overview of the law of set-off in Poland, both outside and within the context of insolvency. Under Polish civil law, set-off is recognised as a means of meeting liabilities. It fulfils a number of functions in law, including payment and guarantee (collateral) functions. Aside from statutory set-off, a contractual set-off in trade, known as compensation (netting), exists in Poland. The chapter first considers set-off between solvent parties, focusing on statutory set-off, bank set-off, and provisions in the Act on Certain Financial Collateral Instruments that are relevant to compensation. It then examines set-off against insolvent parties, with discussions on standard provisions on set-off after a declaration of insolvency, netting provisions in the Insolvency Act, set-off under bankruptcy with possible settlement, set-off under insolvency with the liquidation of an insolvent estate, and netting under a restructuring proceeding. The chapter concludes with an analysis of issues arising in cross-border set-off.