5 key takeaways
- Chinese companies are increasingly choosing Poland as their European base – attracted by lower labour costs, strong tech talent and Poland’s position as a logistics gateway between China and the EU
- Chinese technology and fintech companies face additional regulatory scrutiny in Poland beyond standard market entry requirements – including FDI screening and national security considerations under NIS2
- GDPR restricts transfers of personal data to China – Chinese companies must implement appropriate safeguards before transferring EU personal data to systems in China
- The AI Act applies to AI systems placed on the EU market by Chinese companies – including high-risk AI systems used in fintech, surveillance or employment contexts
- NIS2 creates specific challenges for Chinese technology companies whose Polish entities may qualify as key or important entities – with implications for supply chain security and vendor oversight
Poland is emerging as a preferred destination for Chinese companies expanding into Europe – offering cost-efficient operations, a strong talent base, and a strategic position as a key node in the China-Europe Railway Express. As one of Poland’s leading lawyers advising international companies on EU market entry, I increasingly work with Chinese technology businesses navigating the Polish and EU regulatory landscape. This post addresses the specific regulatory considerations that apply to Chinese companies – beyond the standard market entry framework that applies to all foreign investors.
Chinese Company Poland EU Market Entry: The Standard Framework
Before addressing China-specific considerations, the standard regulatory framework applies in full. Specifically, Chinese companies entering Poland must:
- Establish a Polish legal entity (most commonly sp. z o.o.) and register with the KRS
- Obtain sector-specific licences where required (KNF for financial services, CASP for crypto)
- Comply with GDPR from the first day of processing EU personal data
- Register for NIP and VAT before the first taxable transaction
- Comply with Polish employment law for locally hired staff
Additionally, if the Polish entity provides services to regulated sectors or operates in a NIS2-listed sector, cybersecurity obligations under the amended KSC Act apply. For more on NIS2, see the NIS2 Poland series.
Chinese Company Poland EU Market Entry: China-Specific Regulatory Considerations
FDI screening – investments in sensitive sectors
Poland operates a foreign direct investment screening mechanism for acquisitions of Polish companies in sensitive sectors. Furthermore, the EU Foreign Subsidies Regulation and sector-specific screening mechanisms apply to Chinese companies that have received Chinese state support.
Specifically, FDI screening in Poland focuses on:
| Sector | Screening trigger |
|---|---|
| Digital infrastructure | Acquiring or establishing control of critical digital infrastructure |
| Financial services | Acquiring a significant stake in a licensed financial entity |
| Energy | Investments in energy infrastructure and generation assets |
| Defence and dual-use | Any investment involving defence-related technology |
| Telecommunications | Acquisition of telecoms networks or providers |
Chinese technology companies establishing greenfield operations (new entities) rather than acquiring existing Polish businesses generally face lower FDI screening exposure. Nevertheless, where the business model involves critical digital infrastructure or financial services, early legal assessment of screening obligations is advisable.
NIS2 and supply chain security – specific implications for Chinese vendors
NIS2 creates a supply chain security obligation for key and important entities in Poland – they must assess the cybersecurity practices of their direct suppliers and service providers. Consequently, Chinese technology vendors providing ICT products or services to Polish NIS2-regulated entities may face supplier security assessments as a condition of commercial relationships.
Additionally, where a Chinese company’s Polish entity itself qualifies as a key or important entity under the KSC Act – for example as a digital service provider, ICT service management company, or manufacturer in a listed sector – it must implement full NIS2 compliance including SZBI implementation by April 2027.
For a detailed breakdown of NIS2 requirements, see NIS2 Cybersecurity Measures: 10 Things to Build by April 2027.
GDPR and China data transfers
GDPR restricts transfers of personal data outside the EEA to countries that do not benefit from an EU adequacy decision. China does not have an EU adequacy decision. Consequently, Chinese companies that transfer personal data collected in Poland or the EU to systems in China must implement appropriate transfer safeguards – typically standard contractual clauses (SCCs) or binding corporate rules.
In practice, this requires:
- Identifying all data flows between the Polish entity and China (customer data, employee data, operational data)
- Implementing SCCs for each transfer and conducting a Transfer Impact Assessment
- Ensuring that Chinese data localisation and security laws do not effectively prevent compliance with GDPR obligations – this is a genuine compliance tension that requires legal analysis
Furthermore, Chinese companies subject to Chinese data security and personal information protection laws must navigate the interaction between those laws and GDPR – particularly where Chinese authorities request access to data held in Europe.
AI Act – implications for Chinese AI companies
The AI Act applies to any AI system placed on the EU market – including systems developed in China and sold or deployed in Poland. Consequently, Chinese AI companies selling to Polish or EU customers face the same provider obligations as US AI companies. Additionally, Chinese AI systems used in high-risk categories (facial recognition, social scoring equivalents, employment AI) face the most demanding compliance requirements. For a detailed breakdown, see my post on US AI Companies and the EU AI Act – the same framework applies to Chinese providers.
Chinese Technology Companies Get That Right – and What They Get Wrong
What companies typically handle well: speed of operational setup, cost management, and technical quality of their products.
What they typically underestimate:
- GDPR compliance lead time – building a GDPR-compliant data architecture takes months, not weeks. Consequently, data processing must not begin until the framework is in place.
- NIS2 supply chain scrutiny – Polish enterprise customers increasingly require security assessments of their Chinese vendors as part of NIS2 compliance. Furthermore, this requirement is enforceable – entities that fail to assess their vendors face regulatory exposure.
- AI Act territorial scope – Chinese AI companies frequently assume the AI Act does not apply to them because they are not established in the EU. This assumption is incorrect.
- Regulatory engagement style – KNF and Polish regulators expect proactive communication and detailed written documentation. The engagement style differs materially from Chinese regulatory processes.
If you are a Chinese company considering expansion into Poland or the EU and need regulatory guidance, get in touch. You can also find more on the FinTech practice area page and the Cybersecurity, NIS2 & DORA page.
Katarzyna Szczudlik is a Partner at Schoenherr in Warsaw and one of Poland’s leading lawyers advising international companies on Poland and EU market entry. Ranked by Chambers & Partners (FinTech) and Legal 500 EMEA. Get in touch.
