On 9 October 2000 the President of the Republic of Poland signed a new Commercial Companies Code, which was passed by the Parliament on 15th September 2000. Due to its fundamental character, resulting (first) from a wide range of regulated problems, the proper implementation of the Code is strictly connected with the implementation of the two other Acts passed by the Parliament:
The Commercial Companies Code begins with general provisions which determine the object of the regulation. The new law regulates the formation, structure, operation, dissolution, merging, division, as well as transformation of commercial companies. The Code introduced a new legal form of "a company in organization". This Code determines that a company in organization is an imperfect legal person, the third category of legal entities apart from natural and legal person.
Polish regulations allow the following legal forms of business:
And, in connection with European law, following forms:
According to Art. 13 of the Business Activity Law the foreigners from EU and EFTA enjoy the same rights as the Polish citizens and companies by taking up and conducting business activities on the territory of the Republic of Poland.
The citizens of foreign states who are not from EU and EFTA and who among others have received a permit to settle on the territory of the Republic of Poland, a permit to stay as a long-term resident of EC, a status of refugee granted in the Republic of Poland, a consent for tolerated stay or enjoy temporary protection within the territory of the Republic of Poland, shall enjoy the same rights as the Polish citizens by establishing and conducting business activities on the territory of the Republic of Poland.
Other foreigners may conduct business in Poland in the form of companies regulated by commercial law like: limited partnership, limited joint-stock partnership, limited liability company, joint stock company.
Currently the limited liability company can be registered in two ways:
Original documents from EU countries have to be translated into Polish by an authorized translator.
Original documents in foreign languages from non-EU countries have to be confirmed by the appropriate Polish embassy or consulate as having being prepared in accordance with the law prevailing in the country of the parent entity.
The basis of a civil partnership is regulated in the Civil Code of 23rd April 1964 in Art. 860 and subsequent. By a deed of partnership the partners shall undertake to promote the attainment of a common economic objective by acting in a specific manner and in particular, by making contributions. The most important is that the deed of partnership shall be made in writing. The partners shall bear joint and several liabilities for the partnership's obligations. International agreements on reciprocity should be in place. Otherwise, a foreign investor is required to present a certificate issued by the competent Polish representation abroad, stating that, in accordance with the principle of reciprocity, Polish entrepreneurs are permitted to conduct business activity in the country in which the investor has permanent residency or a registered office. The partners pay Personal Income Tax (PIT).
Representative offices may only carry out activities relating to advertising and promotion of the foreign person. In order to establish a representative office an entry is required into the register of representative offices kept by a relevant ministry. In addition, a representative office is not a self-balancing unit. Any division of property by the entrepreneur, if effected, is of purely technical and organizational nature.
A representative office is obliged to:
Branch offices are able to undertake a variety of economic and trading activities provided that:
Up to the time the National Court Register is set up, branch offices are subject to registration in the Register of Entrepreneurs kept by the district courts. In principle, a branch may be established on the condition of reciprocity between Poland and the country of origin of the foreign entity establishing the branch office.
In accordance with the definition a registered partnership shall be a partnership which conducts an enterprise under its own name and is not any other commercial company. Such a partnership does not possess a legal personality, though it may act on in its own behalf, and has its own assets and debts. Every partner shall be liable for obligations of the partnership without limits, with all his assets jointly and severally with the remaining partners. In order to be effective, a deed of partnership must be executed in writing, whereupon the partnership should be entered into the National Court Register.
The Code introduces two categories of partnerships unknown under the Commercial Code of 1934. The first one is a professional partnership designed for individuals performing regulated professions and rendering their services as a partnership by running an enterprise under its own business name. This partnership has no legal personality. Professional partnership is available for investors wishing to conduct economic activities defined as "free professions". Partners in this partnership may be persons authorized to practice the following professions: attorney, pharmacist, architect, expert, auditor, insurance broker, tax consultant, accountant, physician, dental surgeon, veterinary surgeon, notary, nurse, midwife, legal counsel, patent agent, property valuer and sworn translator. The deed of this partnership shall be made in writing. A partner shall not bear liability for partnership's obligations which arise in relation to the practicing of liberal profession by the remaining partners within the partnerships, as well as for partnership's obligations resulting from the actions or default of persons employed by the partnership, such persons being subordinate to another person. The partnership should be entered into the National Court Register. The company is created upon its entry in the register. International agreements on reciprocity should be in place. Otherwise, a foreign investor is required to present a certificate issued by the competent Polish representation abroad, stating that, in accordance with the principle of reciprocity, Polish entrepreneurs are permitted to conduct business activity in the country in which the investor has permanent residency or a registered office.
A limited partnership is a company, in which at least one partner is a general partner and has an unlimited liability towards the partnership's creditors (unlimited partner) and the liability of at least one other partner is limited (limited partner). The limited partner is responsible for the company's liabilities only to the value of his capital contribution. The deed of this company shall be made in a notary form. The limited partnership comes into existing after entry into the National Court Register.
It is a very popular way of conducting business in Poland among medium and large companies and foreigners. This form of activity is usually established for the purpose of operating business on a large scale. The company deed (articles of association) must be prepared in the form of a notarial deed, or is otherwise null and void. The founders can be one or more legal or natural persons. The initial capital of the company must not be less than PLN 5.000, and the initial value of one share must not be less than PLN 50. The Company is liable for its debts and obligations with its whole property. There are no special requirements for foreign investors.
A limited liability company act may be formed by one or more persons for any legitimate purpose. Founders may not be another limited liability company as the single promoter. The shareholders are not liable for the obligations of the company. A limited liability company is a legal entity. Limited liability companies having their seats abroad may establish branches or representations on the territory of the Republic of Poland.
Establishment of a limited liability company:
*Along with the registration documents filed to the National Court Register, the management board applies for the following:
Registration Court sends the above notifications to the right departments. It does not verify their correctness or completeness.
A limited join-stock partnership shall be a partnership in which at least one partner (general partner) has unlimited liability towards the partnership's creditors and at least one partner is a shareholder. The initial capital of this company shall amount to at least PLN 50.000. A supervisory body may be appointed in this partnership. The supervisory board shall exercise permanent supervision over the activity of the partnership in all areas of such activity. This partnership does not possess a legal personality, though it is in a way a hybrid of a joint-stock company and limited partnership (limited joint-stock partnership).
A joint stock company (S.A.) differs from a limited liability company (apart from the required minimum of share capital and some other features) in that there is a possibility of using bearer shares. This company may be formed by one or more persons. A sole-shareholder limited liability company is not allowed to form a joint-stock company formation as the single promoter. The statute of a join-stock company shall be executed in the form of a notarial deed. The minimum capital is PLN 100 000 and is divided into equal nominal shares of at least PLN 0,1. In a join-stock company a supervisory board is obligatory and supervises the activity of the company on an on-going basis. The supervisory board is composed of at least three members appointed by the General Meeting. A member of the current management board, the company's liquidator or some of the company's senior employees (e.g. chief accountant, legal counsel, etc.) may not be members of either of the company's supervisory bodies. The General Meeting (in a join-stock company) or the Meeting of Shareholders (in a limited liability company) is a decision-making body in matters of major significance to the company. Its meeting may be ordinary or extraordinary. An ordinary meeting should take place once a year. It should be held during the first six months of the financial year.
According to the Law of the National Court Register of 7th October 1997, as of 1st January 2001 companies, commercial partnerships must be registered in the Register of Entrepreneurs, which is part of the National Court Register managed by the district courts.
The Register of Entrepreneurs is open to the public. It consists of six parts, including as follows:
An individual, who conducts economic activity, is registered in a register of business activity kept by the communes. The registration books, in which companies in organization are also listed, are kept by the head of the commune, the mayor or president of the town.
The foreign entrepreneur must meet the following formal requirements in order to obtain an entry in the Register of Entrepreneurs:
Cost of registration:
Cost of amending the registration data:
1. Legal form:
- individuals and partners in civil partnerships,
2. Registration authority:
- municipality of town,
3. Registration procedure:
Requests are sent in an electronic form, using the website of the Central Evidence. They can be also delivered personally to the municipality or submitted by the Post Office (in the latter case the signature must be confirmed by a notary).
4. Document confirming the entry:
- certificate of registration in the Central Evidence of Information on Business Activity,
5. Cost of registration:
- free of costs
6. Cost of amending in the register of business activity:
- free of costs