The 9th International Factoring Congress is behind us, so one may be tempted to summarize it. Due to the theme of the Blog, the summary will be about the legal aspects of factoring - both those that appeared at the Congress and those for which there was not enough time. The congress has already been comprehensively summarized by the PZF here - I encourage you to read on. I, on the other hand, will focus in the summary on what I know best - that is, the legal aspects of factoring.
# Time for "Free Invoices"
At the Congress, the "Free Invoices - no ban on assignment" Campaign was officially launched. The PZF deserves a big word of praise for the idea and implementation. The campaign is needed - not only from a business point of view but also from a legal point of view. I have repeatedly encountered non-assignment clauses in contracts, which often prevent the contract from being covered by factoring. I have written more extensively about this HERE. This is a limitation for the industry, but also for entrepreneurs. In the current situation, a large-scale campaign is extremely necessary and serves not only the industry but the entire B2B market. The Factoring and the Law blog will become a partner of the campaign.
# Panel discussion
This year the panel discussion on legal changes was the last panel of the Congress. As for me, it could have lasted all day, because this year we are dealing with a very large number of significant legal changes that directly affect the factoring industry. Time to fully discuss the changes was a bit lacking, we managed to discuss mainly the topic of split payment, mention STIR, white and black lists of VAT taxpayers. The positives in the thicket of changes are: (i) the very cautious use of split payment transfers by factoring recipients, (ii) the cooperation of the Ministry of Finance and industry consultations on the changes concerning the factoring market.
# The year 2018 - what is behind us already?
Since there was a little lack of time at the Congress to fully discuss the changes, I took the liberty of presenting to you in the form of the following list the scope of this year's most important legal changes affecting the factoring industry, which have already come into effect:
1 Single Control File;
2. the RODO regulation (which I wrote about, among other things. here);
3 Split Payment I wrote about:
– here - overall,
– here - in the context of how companies are struggling with split payment,
– here - in the context that the use of non-firm accounts by small businesses may be a patent on split payment,
– here - In the context of individual interpretation.
4. the new law on liability of collective entities (which I wrote about here);
5. shortening of the statute of limitations, which affects the factoring industry in a very limited way (as I have written about here i here);
6. making it easier for factoring companies to verify debtors for free in the form of (i) publication of financial statements, (ii) a new national register of debtors, (iii) publication on the MF website of an extract from the tax returns of the largest taxpayers (which I wrote about here);
7. the new law on anti-money laundering and financing of terrorism, the so-called AML (which I will write about soon);
8. the new law of November 24, 2017 on amending certain laws to prevent the use of the financial sector for tax evasion, the so-called STIR - concerning factories that are banks;
9. the Law of May 10, 2018 amending the Payment Services Act and certain other laws (implementation of the PSD2 Directive - mainly concerning FinTechs);
I have also started an authoritative series of reviews of court rulings in factoring cases (for the first entry on case law from H1 2018, see here).
10 Changes affecting the factoring industry only indirectly are:
- changes in the KRS business register (which I wrote about here),
- New rules on the use of monitoring by the employer (which I wrote about here),
- deletion of entrepreneurs from CEiDG for not having their PESEL number entered (which I wrote about here),
- Simple Joint Stock Company - as a project of a new commercial company (which I wrote about here),
- The amendment to the Act on Combating Unfair Competition (which I wrote about here).
# The year 2018 - what's yet to come FOREVER?
Despite such a huge package of legal changes, we are not at all at the finish line. Here are the 3 most important changes that may be enacted later in 2018:
- The Law on the National Debt Register (draft adopted on 29.05.2018), which is likely to go into effect on 1.02.2019, and will allow the factoring industry to verify factoring agents, board members, proxies, guarantors and other entities for free to a limited extent. I wrote about it here;
- The Law on Openness of Public Life (draft dated 8.01.2018 was referred to the Permanent Committee of the Council of Ministers), which in its current wording includes a significant number of factoring companies as at least medium-sized entrepreneurs and provides for the mandatory adoption of internal anti-corruption regulations (which I wrote about here);
- Law on amending certain laws to reduce payment congestion (draft adopted 14.09.2018) - which significantly affects the industry in terms of, among other things, reducing b2b payment terms to 60 days, speeding up injunction proceedings, introducing mandatory reporting of reports on applicable payment terms in commercial transactions, etc. (which I will be writing about on the Blog soon).
With these changes in mind - I have taken the liberty of calling 2018 "The Year of Compliance". Indeed, this year the number of internal procedures to be developed and implemented at companies in the industry is at a record high. It is also worth mentioning here the procedure for whistleblowers and the black and white list of VAT taxpayers. The increased importance of compliance, as well as sanctions for non-compliance, makes it necessary to establish a position in most factoring companies 'compliance officer'. Current times lead to the conclusion that those who do not want to be left behind must adapt to the changing legal environment in a thoughtful, prudent professional manner. The importance of processional outsourcing of third-party services is growing. On the other hand, the biggest challenge remains implementing legal changes without negatively interfering with operations and without making life difficult for customers and employees.
At the same time, I congratulate PZF on the excellent organization of the Congress. Surely everyone will look forward to next year's 10th anniversary International Factoring Congress!
