Introduction to Polish Company Law

Monika Tarska
Company Law Editor

Habilitated doctor, associate professor in the Institute of Legal Studies of the Polish Academy of Sciences and in the Chair of Private Economic Law at the Faculty of Law and Administration of the Cardinal Stefan Wyszyński University; the author of numerous publications on commercial law, including commentaries to the Code of Commercial Companies and the Act on National Court Register.

I. Polish Company Law is governed by the Code of Commercial Companies (Kodeks spółek handlowych) of 15 September 2000 (Journal of Laws No 94, item 1037 as amended – “CCC” or the “Code”). It contains ‘regime provisions’, regulating the creation and organisation of companies, their functioning, dissolution, joining, division and transformation.

The Code specifies two kinds and four types of companies:

1. partnerships (spółki osobowe):

  • registered partnership(spółka jawna, Articles 22 – 85 CCC),
  • professional partnership (spółka partnerska, Articles 86–101 CCC),
  • limited partnership (spółka komandytowa, Articles 102–124 CCC),
  • limited joint-stock partnership(spółka komandytowo-akcyjna, Articles 125–150 CCC);

2. companies / capital companies (spółki kapitałowe):

  • limited liability company (spółka z ograniczoną odpowiedzialnością, Articles 151 – 300 CCC);
  • joint stock company (spółka akcyjna, Articles 301 – 490 CCC).

II. The Civil Code(Kodeks cywilny – “CC”) contains the regulation of business entities and their names, including the business name (firma) – i.e. the name used when carrying out business activity (Articles 431 – 4310 CC), as well as the commercial power of attorney (prokura) (Articles 1091 – 1099 CC). It also covers the regulation of civil law partnership (spółka cywilna, Articles 860 – 875 CC). As with companies, civil law partnerships are often used for conducting business activity, however, unlike companies they do not have legal personality. A civil law partnership is a contractual union of at least two persons acting to obtain a mutual economic aim. The assets of a partnership are the common property of the partners (in joint ownership). Partners bear joint and several responsibility for the obligations arising from the operation of a partnership.

  • The Law of commercial companies in Poland constitutes a part of civil (private) law. According to the rule of uniformity of civil law, the provisions of the Civil Code should be applied directly to the majority of matters of a civil nature that pertain to companies. Under Article 2 CCC, due to the property (nature) of the legal relationship of a commercial company, the provisions of the Civil Code ought occasionally to be applied not directly, but merely indirectly (i.e. with certain modifications) or excluded entirely. What also has to be borne in mind is the nature of particular types of commercial companies – while taking into account the peculiarities of their sub-types (e.g. public companies, bank companies, family limited joint-stock companies, etc.).
  • An important element of the legal regulation of commercial companies are provisions regulating the rules of registering companies in the court register (the commercial register), as well as registration proceedings. The National Court Register, created by the Act on the National Court Register of 20 August 1997 (the “ANCR”) is the central record covering the entire state. It comprises three separates registers: (1) the commercial register, (2) the register of associations, other social and professional organisations, foundations and public health care institutions, and (3) the register of insolvent debtors. The register and the registry proceedings are maintained, within a computer system, by the district courts (sądy rejonowe). The data collected in the register is gathered and provided by the Central Information of the National Court Register (Centralna Informacja Krajowego Rejestru Sądowego).

Under the ANCR, entities subject to registration must provide data for the registry court if a particular occurrence or a legal state has taken place. The entry to the register is, in principle, made upon a motion – unless the law prescribes the entry ex officio. The motion is issued on the official form (Article 19 sections 1 and 2 ANCR). The statute regulates the term, procedure and effects of submitting the motion, as well as the consequences of not submitting it within the prescribed term. The National Court Register serves above all an informative function, for that reason it is public (Article 8 ANCR).

The ANCR sets out a duty to publish an announcement in the “Court and Economic Monitor” (Monitor Sądowy i Gospodarczy – the official governmental bulletin) of the data entered into the National Court Register. Subject to this duty are also other announcements and information required by other acts (e.g. CCC and the Code of Civil Procedure).The informative function of the National Court Register is performed, among other things, by granting the registry court the supervisory and controlling power. The court inspects the content of entries, examines the data and the documents submitted as the proof thereof (in terms of their correctness, as well as formal and material compliance with law – Article 23 ANCR). The court may also impose upon the obliged entities certain means of coercion to ensure that the appropriate data is provided and registered.

All entities that are classified as business entities under the ANCR and, in principle, carry out business activity must be registered. The register of associations, other social and professional organisations, foundations and public health care institutions collects information pertinent to other entities that, due to their type of activity and the way they were created, must be registered. These entities may be conducting business activity, though it does not constitute their primary function. Entries to the register of insolvent debtors concern entities, including business entities, that have found themselves in a bad financial condition. It also covers individuals who, having committed relevant offences, have been subject to a court order depriving them of the right to carry out business activity or performing a function, among other things, serving on a company’s governing body.

Certain types of commercial companies are also subject to the regulations of specific legal acts. These provide additional requirements or rigorswith respect to the features of business carried out (the broad scope of interested entities or peculiarities of the service provided), as well as due to the social character of the activity.

Certain types of commercial companies are also subject to the regulations of specific legal acts. These provide additional requirements or rigorswith respect to the features of business carried out (the broad scope of interested entities or peculiarities of the service provided), as well as due to the social character of the activity. This concerns, in particular, joint stock companies that perform banking or insurance activity, as well as those that deal with radio and television, the stock exchange or commodity exchanges. Such special rules also apply to partnerships within which special services are provided – independent professions (doctor, notary public, attorney, solicitor, etc.).

Commercial companies, in particular joint stock companies, fall under the provisions of three acts dated 29 July 2005 constituting the capital market law. The acts in question are: the Act on Trading in Financial Instruments (the “Act on Trading”); the Act on Public Offerings, Conditions Governing the Introduction of Financial Instruments to Organised Trading and Public Companies (the “Act on Public Offerings”); and the Act on Supervision over Capital Markets (the “Act on Supervision”).

Capital markets are understood as markets of securitiesand other financial instruments – to the extent that the provisions of the Act on Supervision are applicable to them (Article 2 point 6 of the Act on Supervision).

The Act on Trading determines the rules, procedureand requirements for commencingand carrying out the activity in the field of trading in securities and other financial instruments. It also sets out the rights and duties of entities involved in trading, as well as supervision in this respect (Article 1 of the Act on Trading). Financial instruments – including securities, are subject to legal transactions on the regulated market (i.e. secondary trade in financial instruments), covering trading in shares (organised by a company running a stock exchange), the extra-stock market(organised by the respective company) and the commodity market of financial instruments, organised by the commodity exchange and only covering trade in financial instruments (Article 15 of the Act on Trading). The stock market and extra-stock market may be operated by a joint stock company (active exclusively in the field of stock exchange, or in another activity in the domain of financial instruments trading and associated activity (as well as education, promotion and information on the functioning of the capital market).

The provisions of the Act on Public Offerings establish a set of various rules and principles (on issuing public offers of securities or other financial instruments, applying for admitting them to the regulated market, obligations of issuers of securities and other entities involved in trading in this field, the consequences of obtaining the status of a public company, and specific rights and duties concerning trade in their shares). A public offering is issued on the primary market by an issuer [emitent], (i.e. a person issuing securities sui iuris, e.g. a joint stock company) or on the secondary market by a sub-issuer [subemitent usługowy]. Offer can be for securities of a new issue, or acquiring securities of this issue (Article 4 point 3 Act on Public Offerings). Securities subject to a public offering or admitted for turnover on the regulated market are not in documentary form until they are registered in the securities depositary (this is known as the “dematerialisation of securities”). A company with at least one dematerialised share is a public company [spółka publiczna].

Companies also come under legal regulation in EU acts, both primary (e.g. TFEU, formerly TUE, the provisions of which are taken into account by CCC and other company law acts) and secondary by nature – especially resolutions and directives on company law, including the Council Regulation (EC) No 2157/2001 of 8 October 2001 on the Statute for a European company (SE) and Council Regulation (EEC) No 2137/85 of 25 July 1985 on the European Economic Interest Grouping (EEIG), regarding also the Act on the European Economic Interest Grouping and on the European Company of 4 March 2005 (see also Council Directive 2001/86/EC of 8 October 2001supplementing the Statute for a European company with regard to the involvement of employees).

It should be emphasised that, pursuant to Article 54 section 1 TFEU (formerly Article 48 section 1 TUE), companies enjoy equal freedom of organising business activity, as natural persons. It embraces, first and foremost, taking up “primary” business activity by establishing an enterprise, organised under the law of commercial companies. This activity is explicitly dealt with in Article 49 Section 2 TFEU (Article 43 Section 2 TUE) among the rights that grant citizens and enterprises of the Member States the freedom to take up business activity (i.e. the freedom to establish enterprises).