PGNiG is Pushing For Punishing Gazprom

Many years of self-serving attitude on the part of the Russian giant left its mark on the finances of Poles. The European Commission, which since 2012 has been carrying out anti-monopoly proceedings against Gazprom, took notice of a statement from Polskie Górnictwo Naftowe i Gazownictwo who demanded punishing the Russian giant. Piort Woźniak –PGNiG’s President – stated the EC should penalize Gazprom financially and impose obligations that would prevent the company from breaching anti-monopoly regulations in the future.

As it turned out, the Russian corporation inflated gas prices, taking advantage of its position and not respecting changes in the market. They were successful thanks to our gas dependence, and now they promise improvement and introduce feign changes, which for PGNiG are, however, unsatisfactory. Woźniak’s company argues that the only reasonable punishment for Gazprom is a financial penalty, adequate to the profits earned through price inflating, of course. Even though the gas prices at which Poland was buying the raw material were not disclosed, unofficially it is said they were very inflated (in comparison: Germany for 1000 square meters of gas would pay 281 dollars, while we had to pay 500). The practice resulted in cutting down our companies’ competitiveness.

Still, the problem is not only Gazprom’s policy but also the fact that we made things easy for the Russians because Russian gas prices never depended on the market but on the policy. Like Germany, France, buying much lower amounts of gas, paid much less for the raw material. Warsaw-Kremlin negotiations were not successful, as our weak spot was gas dependency on Russia. The situation is slowly changing due to the built interconnectors that allow us to import gas brought to other markets.

Some experts remark that the issue of cutting dependency on Russia could have been taken care of earlier thanks to the planned construction of a gas pipeline in Norway. The plans were blocked by the government of Leszek Miller in 2011. Resigning from the construction of the gas pipeline (justified by the “propaganda nature” of the pipeline) left us with no possibility to end the irrational price dictate of the Russians.

Investment Outlook and Business Perspective

Poland remains one of the most attractive investment destinations in the European Union. With GDP exceeding EUR 650 billion, Poland is the sixth largest economy in the EU and the largest in Central and Eastern Europe. The country has maintained positive economic growth for over three decades, including through multiple global crises.

Foreign direct investment in Poland continues to grow, driven by the country’s strategic location, skilled workforce, EU membership, competitive costs, and improving infrastructure. Key sectors attracting investment include manufacturing, technology, business services, logistics, and financial services.

For investors considering entry into the Polish market, proper structuring of the investment vehicle is crucial. The choice between a sp. z o.o. (LLC), S.A. (joint-stock company), branch office, or joint venture depends on the investment size, sector, tax considerations, and long-term strategic objectives. Professional advisory can help optimize the structure from both operational and tax perspectives.

If you are doing business in Poland or considering entering the Polish market, Zalewski Consulting can help. Learn more about our company formation in Poland, or contact us for a free consultation.