News Parkiet

Taxes

Finance Ministry says 'no' to tax deductions

Polish Finance Ministry says it will oppose an income tax deduction for investors who own mutual fund portfolios despite contrary assessments by legal experts and tax authorities. New PIT personal income tax law gave retail investors the right to offset gains and losses on the sale of mutual funds. However, officials at the Finance Ministry argues that can't be done, using its own interpretation of the Polish tax regulations.

Energy

Long-term energy contracts may cost PLN 17 billion, official says

Compensation for local power plants after the termination of long-term energy contracts signed under previous regulatory regime won't cost more than 17 billion zloty ($4.5 billion), a senior official at the Polish Ministry of the Economy said yesterday. Poland originally promised it would eliminate the contracts with state-owned PSE power grid operator by July 1st, opening up energy distribution market.

Railways

PKP Cargo fined for antitrust violations

Poland's antitrust authority UOKiK said it has fined PKP Cargo, a government-owned railway company 40 million zloty ($10.5 million) for abusing its dominant position on the market by signing restrictive contracts with other carriers. UOKiK said PKP Cargo effectively banned its clients from using the services of competing firms. The carrier has already said it will appeal the verdict.

PKP Cargo has retained 70 percent of the Polish market despite the opening of railway freight services in 1998.

WSE

SEC to approve two IPO's today

Polish Securities and Exchanges Commission is expected to approve IPO plans of two new companies at its meeting on Tuesday, sources at the SEC told PARKIET yesterday. Most likely candidates for IPO include Comp Rzeszów software house and FAM, a Wrocław-based maker of iron castings and building accessories. At least twelve new companies have filed for IPO's in recent months.

Pharmaceuticals

Poland to give away Jelfa to help Szczecin

shipyard

Shares of Jelfa drug-maker fell 3.3 percent to close at 67.2 zloty yesterday after a government decision to give away 26 percent of the company to state-owned agency that will use the stock to prop up a large Polish shipyard. Industrial Restructuring Agency (IRA) will receive over 1.7 million shares of the publicly traded Jelfa, worth an estimated 118 million zloty ($31 million) to help pay for the expansion of Stocznia Szczecińska Nowa, a shipyard from northern Poland established using assets of the now bankrupt Stocznia Szczecińska.

Sources at the IRA, a government agency that is supposed to help restructure ailing state-owned companies say they don't know yet if Jelfa will be sold on the WSE, or used as collateral for loans on Nowa's behalf.

Polish government had almost 30 percent of Jelfa before yesterday's decision.

Steel

Stalprofil sees stronger earnings despite lower revenue

Stalprofil steel distributor has announced on Friday it expects as much as 40.6 million zloty in earnings this year, up from last year's PLN 30.2 million despite lower revenues as it cuts down on low-margin coke sales. Stalprofil, which sells steel components made by LNM's Polish unit, Ispat Polska Stal, says its sales will decline almost 20 percent to PLN 708 million.

The firm, which is controlled by LNM and by steel trade unions says it will try to maintain ROE at 20 to 25 percent.

Steel

Arksteel CEO joins Ropczyce's board

Ropczyce SA, steel industry supplier has announced the appointment of Kostyanty Lytvynov to the company's board of directors. Lytvynow, a former Ukrainian diplomat took over as chief executive of Arksteel, a publicly traded shell company on behalf of Donbas Industrial Association, which plans to use the firm as a vehicle for takeovers in Poland.

Ropczyce, which makes casting powder a