Obliged Institution in Poland – Who Is Considered One Under the Polish AML Act?

An obliged institution in Poland is an entity subject to the provisions of the Polish Act on Counteracting Money Laundering and Terrorist Financing and, as a result, required to perform specific AML/CFT obligations. Despite the term, this does not apply only to banks or large financial institutions. In Poland, an obliged institution may also be an accounting firm, real estate intermediary, currency exchange business, notary or entrepreneur carrying out a specific type of activity.

An obliged institution in Poland is an entity subject to the provisions of the Polish Act on Counteracting Money Laundering and Terrorist Financing and, as a result, required to perform specific AML/CFT obligations. Despite the term, this does not apply only to banks or large financial institutions. In Poland, an obliged institution may also be an accounting firm, real estate intermediary, currency exchange business, notary or entrepreneur carrying out a specific type of activity.

What is an obliged institution?

The concept of an obliged institution comes from the Polish Act of 1 March 2018 on Counteracting Money Laundering and Terrorist Financing, commonly referred to as the Polish AML Act. Article 2(1) of the Act contains a catalogue of entities subject to obligations related to counteracting money laundering and terrorist financing in Poland. The current catalogue is broad and includes both the financial sector and many professions and activities not directly related to banking. The term “institution” may therefore be misleading.

Example: a person conducting business activity in Poland involving the provision of bookkeeping services may be an obliged institution even if they operate a small office and are not a financial institution.

The status of an obliged institution has practical significance. It means that specific AML solutions must be implemented, including risk assessment, an AML procedure, customer due diligence measures and rules concerning customer identification.

Who is an obliged institution under the Polish AML Act?

The catalogue of obliged institutions in Poland is extensive. For greater clarity, it can be divided into several basic groups.

Banks and financial market entities

The most obvious group of obliged institutions consists of entities operating in the Polish financial market. The Polish AML Act includes, among others:

• domestic banks and certain branches of banks and credit institutions,
• cooperative savings and credit unions and Krajowa SKOK,
• domestic payment institutions,
• small payment institutions,
• payment service offices,
• electronic money institutions,
• acquiring institutions,
• investment firms and custodian banks,
• certain entities conducting brokerage activities,
• investment funds, alternative investment companies and entities managing them,
• certain insurance undertakings and insurance intermediaries,
• the Central Securities Depository of Poland within the scope specified by the Act,
• certain entities associated with DLT systems,
• lending institutions,
• entrepreneurs conducting pawnshop activities,
• credit servicers.

The detailed scope of individual categories results directly from Article 2(1) of the Polish AML Act and the provisions to which the Act refers.

Currency exchange businesses and entities associated with virtual currencies

Obliged institutions in Poland also include entrepreneurs conducting currency exchange activities and certain entrepreneurs providing currency exchange services or acting as intermediaries in currency exchange. The current Polish AML Act also covers entities conducting business activity involving the provision of certain services related to virtual currencies, including, among others:

• exchanging virtual currencies for means of payment and vice versa,
• exchanging one virtual currency for another,
• acting as an intermediary in such exchanges,
• maintaining certain accounts related to virtual currencies.

In the case of this sector, changes resulting from new EU regulations are particularly important, so the classification of an entity should take the current Polish and EU legal framework into account.

Accountants, tax advisers and statutory auditors

The Polish AML Act also covers certain entities providing accounting and tax services. Obliged institutions include, among others:

• entities conducting business activity involving the provision of bookkeeping services,
• tax advisers within the scope specified by the Act,
• statutory auditors,
• entrepreneurs that are not other obliged institutions and whose primary business activity includes, among other things, preparing declarations, maintaining tax records or providing advice and explanations concerning tax or customs law.

This means that AML obligations in Poland may also apply to a relatively small accounting firm or a company providing certain tax services.

Example: an entrepreneur providing bookkeeping services to other companies in Poland falls within the catalogue of obliged institutions. They should therefore determine which AML obligations apply to their activity rather than assuming that the regulations concern only the financial sector.

Advocates, legal advisers, notaries and other legal professionals

In the case of legal professions in Poland, the situation is more complex. Not every activity performed by a lawyer results in the application of AML regulations. The Polish AML Act specifies certain activities performed by advocates, legal advisers, foreign lawyers and tax advisers. These include, among others, assistance concerning:

• the purchase or sale of real estate or an enterprise,
• management of the customer’s funds or other assets,
• certain activities related to bank accounts and securities accounts,
• making contributions to companies,
• establishing or managing companies and trusts.

Notaries are also obliged institutions under Polish law in relation to specific activities defined in the Act, including certain activities concerning the transfer of ownership of real estate, enterprises, shares or capital changes. This is a good example of why it is not always enough to say: “I run a law firm, so I am an obliged institution” or “I am a lawyer, so the Polish AML Act does not apply to me”. What matters is the specific scope of the activities performed.

Entities providing services to companies

A separate category under the Polish AML Act consists of entrepreneurs providing certain services related to the establishment and operation of legal persons and other structures. This includes, among others, entrepreneurs providing services involving:

• establishing legal persons or organisational units,
• acting as a member of a management board or enabling another person to perform such a function,
• providing a registered office, business address or correspondence address together with certain related services,
• acting as a trustee of a trust or enabling another person to do so,
• exercising certain rights attached to shares on behalf of other entities.

In this group, therefore, it is again not the general profile of the entrepreneur that matters, but the type of service actually provided.

Real estate intermediaries

Real estate intermediaries in Poland are also obliged institutions. However, the Polish AML Act provides for a specific exclusion concerning intermediation leading to the conclusion of a lease or tenancy agreement. If the monthly rent is set below the equivalent of EUR 10,000, such intermediation activities relating to lease or tenancy are excluded from this category.

Example: a company intermediating in the sale of real estate in Poland is in a different position from an intermediary dealing exclusively with the rental of residential premises for a few thousand zlotys per month. When determining the status, the actual scope of activity must therefore be examined.

Other entities covered by the Polish AML Act

Article 2 of the Polish AML Act also covers a number of other categories. These include, among others:

• postal operators,
• entities conducting gambling activities,
• entrepreneurs providing safe deposit boxes,
• certain entrepreneurs trading in works of art, collectors’ items and antiques,
• foundations and associations in certain cases,
• entrepreneurs accepting or making certain cash payments for goods.

In some of these cases, the status of an obliged institution arises only after a specific condition has been met. For example, foundations and associations with legal personality are covered by the Polish AML regulations to the extent that they accept or make cash payments with a value equal to or exceeding the equivalent of EUR 10,000, including where several transactions appear to be linked. A similar threshold applies to certain cash payments for goods made by entrepreneurs.

Is every entity in the listed industry an obliged institution?

Not always. This is one of the most important issues when determining the status of an obliged institution under Polish law. In the case of some entities, inclusion in the catalogue results directly from the type of business activity conducted. A good example is an entity providing bookkeeping services. In other cases, however, what matters is:

• the type of activity performed,
• the scope of the service provided,
• the value of the transaction,
• the form of payment,
• fulfilment of additional conditions specified in the Polish AML Act.

Example – law firm

A legal adviser providing legal assistance in Poland is not subject to AML obligations to the same extent in relation to every legal consultation. Article 2 of the Polish AML Act specifies particular types of activities linked to the status of an obliged institution. It is therefore necessary to determine whether a given service falls within the statutory catalogue.

Example – foundation

The mere fact of being a foundation in Poland does not mean that every foundation automatically becomes an obliged institution in the full scope. What matters, among other things, is making or accepting cash payments specified in the Act with a value equal to at least the equivalent of EUR 10,000. At the same time, a foundation may also become subject to the Polish AML Act on another basis if it conducts activity falling within another category listed in Article 2.

Example – real estate intermediary

A different scope applies to the sale of real estate than to certain intermediation activities relating to lease or tenancy. In the latter case, the Polish AML Act provides for a threshold concerning the amount of monthly rent. Therefore, when classifying an entrepreneur, caution should be exercised with simplified lists such as “industries covered by AML”. They may be a good starting point, but they are not always sufficient to determine the obligations of a specific company conclusively.

How to determine whether a company is an obliged institution in Poland?

If there are doubts, it is worth going through several basic steps.

1. Determine the actual scope of activity

First, it is necessary to determine what activities the company actually performs for its customers. The company name, website description or PKD code alone may not be sufficient.

Example: an entrepreneur may provide accounting, advisory and administrative services at the same time. For the purpose of determining AML obligations in Poland, what matters is which of these activities correspond to the categories specified in the Polish AML Act.

2. Compare the activity with Article 2 of the Polish AML Act

The next step is to review the catalogue of obliged institutions in Article 2(1) of the Polish AML Act. It is worth paying attention not only to the name of the category, but also to its full wording. Some points refer to other Polish acts or precisely specify the scope of activities covered by the regulation.

3. Check conditions, thresholds and exclusions

If the provision introduces additional conditions, it is necessary to determine whether they are met. These may include, for example:

• the value of the transaction,
• a cash payment,
• the amount of monthly rent,
• a specific type of service,
• the manner in which a profession is practised,
• whether a particular activity is the entrepreneur’s primary business activity.

Ignoring such elements may lead both to incorrectly concluding that a company is not subject to Polish AML regulations and to imposing obligations on activity to which they do not apply in the relevant scope.

4. Determine the scope in which the regulations apply

In some cases, an entity is an obliged institution only in relation to specific activities. This is particularly important for notaries, certain legal professions, foundations, associations or entrepreneurs covered by the Polish AML Act due to specific transactions.

In practice, answering the question:

“Am I an obliged institution in Poland?”

may therefore also require answering the question:

“For which services or transactions am I an obliged institution?”

What does the status of an obliged institution mean?

If an entity is an obliged institution under Polish law, determining this fact is only the beginning. The Polish AML Act imposes a number of obligations on such entities in connection with counteracting money laundering and terrorist financing.

Depending on the type of activity, these may include, among others:

• preparing and updating an AML risk assessment,
• implementing an internal AML procedure,
• applying customer due diligence measures,
• conducting KYC,
• identifying and verifying the beneficial owner,
• checking information concerning beneficial owners, including appropriate use of the Polish Central Register of Beneficial Owners (CRBR),
• determining PEP status,
• ongoing monitoring of customers and business relationships,
• training persons performing AML duties,
• appropriately documenting the measures taken,
• providing required information and notifications to the Polish General Inspector of Financial Information (GIIF).

For example, the Polish AML Act requires obliged institutions to implement an internal AML procedure that is subject to ongoing review and, where necessary, updating. This does not mean, however, that every obliged institution performs all activities in exactly the same way. The AML system should be adapted to the nature of the business and the risks involved.

What if a company incorrectly concludes that it is not an obliged institution?

A lack of awareness that an entrepreneur is subject to the Polish AML Act does not mean that the statutory obligations cease to apply. If an entity meets the criteria set out in Article 2, it should organise the performance of its AML obligations accordingly. A problem may arise, for example, where a company has been conducting activity covered by the Polish AML Act for several years but has not:

• prepared the required risk assessment,
• implemented AML procedures,
• performed KYC,
• trained the relevant persons,
• documented its activities,
• fulfilled its information obligations.

Breaches of Polish AML regulations may lead to liability and sanctions provided for in the Act. For this reason, the status of an obliged institution should be determined as early as possible – preferably before beginning to carry out activity covered by the regulation.

How will the rules concerning obliged institutions in Poland change in 2027?

The current Polish catalogue of obliged institutions will not remain unchanged indefinitely. One element of the new EU AML package is Regulation (EU) 2024/1624 of the European Parliament and of the Council, referred to as the AML Regulation or AMLR. As a rule, the Regulation will apply directly from 10 July 2027 and will introduce more harmonised rules at EU level concerning obliged entities and the performance of AML/CFT obligations. For certain new categories of entities specified in the Regulation, a later application date has been provided – 10 July 2029.

This means that an entrepreneur determining their status in Poland today should rely on the current Polish regulations, while organisations planning their activities for the coming years should also take into account the forthcoming changes resulting from the EU AML package.

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