Poland- Incorporation Requirements

Establishing a wholly owned subsidiary in a form of a limited liability company is possible in Poland provided that the sole shareholder of such a subsidiary is not itself a limited liability company owned by only one shareholder.

If it is, the subsidiary should be created with two shareholders, one of them subscribing for just one share, which can be disposed of later to the majority shareholder. The company will from that moment be wholly-owned by one shareholder.

The Commercial Companies Code imposes an obligation on the company to notify the register court of the moment it becomes a wholly owned company, with the name, seat and address of the sole shareholder. In addition, if all shares are held by one shareholder, any statements made by such shareholder and addressed to the company must be made in writing otherwise they will be null and void.

The following actions are required in order to establish a limited liability company:

  • Signing of the Deed of Association.
  • Payment of the share capital by the shareholder(s).
  • Appointment of the company’s Management Board and appointment of the Supervisory Board.
  • Registration of the company with the National Court Register.

Deed of Association

The Deed of Association is the founding act of a limited liability company. In order to be valid, it must be drafted in Polish and executed in the form of a notarial deed before a Polish notary.

A person executing a Deed of Association on behalf of a foreign shareholder must provide a Polish notary with documentation proving that he has the authority to act on behalf of the foreign shareholder.

  • An extract from the commercial register or the certificate of incorporation of a foreign company, and
  • A power of attorney authorising that person to execute the Deed of Association of the company.

The power of attorney must be executed in the form of a notarial deed, otherwise it will be null and void. According to the CCC, the Deed of Association must provide at least the following:

  • Business name and seat of the company.
  • The scope of business of the company.
  • The duration of the company, if limited.
  • The amount of share capital.
  • A provision as to whether a shareholder is entitled to only one share or more.
  • The number and value of shares held by individual shareholders.
  • Any in-kind contributions, including the details of any shareholder contributing in-kind and the number and value of shares given in exchange.

Share capital

The share capital of a limited liability company must not be less than PLN 50,000 and the lowest permitted value of a single share is PLN 50. The shareholder’s contributions to the share capital of the company may take the form of either a cash contribution or an in-kind contribution. Shares in a limited liability company are rights, not securities, which means that share certificates are not issued. As a general rule, shares are transferable, subject to any transferability restrictions imposed by the Deed of Association or provisions of law.

Management and supervisory boards

The company must have a Management Board, which may consist of one or several members. Under Polish law, only individuals and not entities can be members of the Management Board. There are no restrictions applying to the composition of the Management Board as far as the nationality or domicile of its members are concerned.

For practical reasons, it is advisable to have at least one person authorised to represent the company available in Poland for signatures and declarations. As a general rule, if the Management Board consists of more than one person, the company is represented by two members of the Management Board acting jointly or by one member acting jointly with a commercial proxy. The Deed of Association may, however, provide for representation by one member of the Management Board.

A Supervisory Board is not a compulsory body in a limited liability company unless the company’s share capital exceeds PLN 500,000 and there are more than 25 shareholders. Members of the Management Board, commercial proxies, liquidators and chief accountants or legal counsels employed by the company cannot simultaneously be members of the Supervisory Board.

Registering the company

The company needs to be entered into the register of entrepreneurs of the National Court Register which is kept by the commercial division of the appropriate District Court. Once registered, a company becomes a legal person, i.e. it becomes capable of acquiring rights and assuming obligations and has full corporate status.

However, the CCC introduced the concept of a company being under incorporation between execution of the Deed of Association and the date of registration. During that period the company, although not yet a legal person, may acquire rights (including ownership rights of real properties).

The company under incorporation is represented by the whole Management Board or by an attorney appointed by a shareholders’ unanimous resolution. A wholly-owned company "under incorporation" cannot be represented by its sole shareholder. Any persons representing the company "under incorporation" are jointly liable with the company and are personally liable for the obligations of the company towards third parties. This liability towards the company ends with the Meeting of Shareholders of the company approving the activities during the period of the company’s incorporation.

The application for the registration of the company in the Register should be filed with the requisite court. If the company is not registered within six months of the date of execution of the Deed of Association, the Deed of Association expires and the company may not be registered.

The application is made by the Management Board and must be signed by all its members. It must comply with the formal requirements set out in the CCC and, the law dealing with the Register. It must be enclosed with the required documentation including declarations signed by all the members of the Management Board stating that the contributions to the company’s share capital have been paid up in full by all the shareholders.

Registration of the company in the Register takes two weeks. Once the company is registered, all changes to the data disclosed in the Register are also subject to registration.