After 27 years of a free market economy and parliamentary democracy, 17 years inside the NATO structure, and 12 years of membership in the European Union, it is easy to forget how much has changed in Poland since the fall of communism. Looking back (and having the perspective of over two decades of professional experience), it is safe to say that nothing would ever be the same after Poland’s transformation.
In 1989 when Poland was on the brink of revolution, I was just starting my law degree. Back then, Polish universities were preparing young people to serve as legal advisors for state enterprises, attorneys for housing collectives, solicitors for public authorities, or just to advise individuals in their day-to-day matters. Lawyers were expected to be simple walking encyclopedias. In the early 90s, state-controlled trade and commerce were much simpler than they are nowadays. Polish lawyers were not prepared for the political and economic earthquake to come or for the tremendous impact it would have on the legal services market.
The years that followed saw an explosion in the number of new laws, especially in the field of commercial activity. Many new fields of law that were not necessary before were introduced. Antitrust law, new tax laws, truly modern commercial company law, and, finally, EU law became critical for daily business. Poland saw an abundance of new law firms appear in the early 90s. Many of them were branches of international legal giants, dealing solely with the privatization of the Polish economy or advising foreign investors eager to explore the possibilities of this fledgling market economy. There was no real legal know-how, especially with respect to advising multinational corporations. The international law firms had to bring all of their expertise with them. I remember during the first years of my legal career, a typical commercial agreement in Poland was just two or three pages long. Our colleagues from foreign law firms would bring to the table several hundred pages of complex contracts reflecting the client’s growing needs.
Over the past 27 years, Polish GDP per capita has increased by more than 100%. To put that into perspective, it means that in 2016, people in their mid-twenties were than twice as productive as their parents were in 1989. Since 1992, Poland has continued to maintain healthy and steady economic growth. In the middle of the fierce 2008 crisis, Poland was referred to as a green island on the map of Europe. The legal system had to catch up with the economic growth.
In the decades since the fall of communism in Eastern Europe, all eyes were on beautiful Budapest or stunning Prague as the go-to place to open a branch of a law firm. Relatively few were interested in starting their businesses in Warsaw, as Poland was considered a slightly backward country. After all these years, however, it turned out that it was the Polish economy that thrived and developed the fastest.
There were several stable economic trends in Poland. The economic upswing was stable and swift, and as a result the legislation governing the market became more and more complex. Poland’s significance was rapidly increasing compared to other CEE countries. The country’s accession to the EU had a tremendous impact on our legal culture. This led to a huge increase in the number of lawyers and law firms, though one could argue that a lawyer’s salary has decreased relatively recently.
From my perspective as managing partner at Linklaters Warsaw, the legal services sector in Poland today is fully professional, with strong know-how and a client-focused approach. Law firms are well structured, dynamic, and well lawyered, with many lawyers frequently changing seats. We have adjusted to western European legal standards. I dare say that some elements of our legal system, taking the notary public system as an example, could serve as a useful model for other markets. Political and social transformation, Poland’s ability to impact the European Union in a way that is in line with our interests, an economic upturn and international trends – all these things have turned out to be key ingredients of the Polish legal market as we see it today.
It is really exciting to be a witness to the whole journey of how the market is evolving. Poland attracts international giants who appreciate the country’s value. But with foreign investments come extremely demanding standards. Having in-depth knowledge and extensive experience is an obvious must. But it is not enough: clients now require us to be their business partners, understanding their core businesses. They demand a business- and solution-oriented approach and strong commercial acumen. It is a huge challenge, and the winner will be the one who is ready and best placed to meet these demands.
By Artur Kulawski, Managing Partner, Linklaters Warsaw
This Article was originally published in Issue 3.6 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.