Current Report No.: 12/2019

Date of preparation: 17.04.2019

Abbreviated name of the Issuer: CIECH S.A.

Subject: The appealed decision of the Head of the Małopolskie Province Customs and Tax Office in Krakow, dated 13 December 2018, upheld

Legal basis: Art. 17.1 of the MAR – inside information

Text of the Report:

The Management Board of CIECH S.A. (the "Company" or "Issuer") informs that today it has received the decision of the Head of the Małopolskie Province Customs and Tax Office in Krakow (the “Authority” or “2nd Instance Authority”) dated 3 April 2019.

Following the appeal lodged by the Company, the 2nd Instance Authority upheld the decision of the 1st Instance Authority of 13 December 2018, defining the Company's tax liability with regard to corporate income tax for 2012 in the amount of PLN 43.7 million, together with interest for late payment, which as of the date of publication of this Report amounts to PLN 24.6 million.

The Company informed about the decision of the 1st Instance Authority, issued in the first instance, in its Current Report No. 36/2018 of 27 December 2018.

The Company created provisions for its tax liability and interest accrued until 31 December 2018 in its separate financial statements of CIECH S.A. and consolidated financial statements of the CIECH Group for 2018, i.e. provisions for income tax in the amount of PLN 43.7 million, together with interest for late payment in the amount of PLN 23.5 million, as announced in Current Report No. 02/2019 of 24 January 2019.

The Company and its advisors disagree with the approach expressed in the decision of the 2nd Instance Authority. The Company intends to take further procedural measures in order to defend the tax consequences of its operations in 2012, by lodging a complaint to the Provincial Administrative Court in Krakow.

The decision of the 2nd Instance Authority is due and payable. Accordingly, the Company is required to pay the amount of the tax specified in the decision, i.e. PLN 43.7 million, together with interest for late payment, which as of the date of publication of this Report amounts to PLN 24.6 million.

Legal basis: Article 17.1 of the Regulation of the European Parliament and of the Council (EU) No. 596/2014 of 16 April 2014 on Market Abuse (the Market Abuse Regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (Official Journal of the European Union L No. 173, p. 1) (the “MAR”).

Signatures of the persons representing the Company:

Dawid Jakubowicz – President of the Management Board

Mirosław Skowron – Member of the Management Board