Poland loses case on pension funds' foreign investment limit at EU court.

By bne IntelliNews December 22, 2011
The European Court of Justice has ruled that Poland has infringed on EU laws by limiting foreign investments by Polish open pension funds (to 5% of their assets). It notes that the Polish limit "is significantly lower than the limit of 30% considered appropriate by the EU legislature." The Polish government pointed to the exchange risks linked to sharp fluctuations in the Polish zloty exchange rate and stressed the need to adopt a particularly prudent approach during the initial period of operation of the new Polish social security system. The European Commission initiated the lawsuit in April of 2009. Commenting on the verdict, FinMin Jacek Rostowski said that he is not surprised by this decision, which is another justification for the Polish government's decision to lower the contribution sent to pension funds to 2.3% of gross wages from 7.3% last year.

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