Will the simple stock company become the most popular corporate form in Poland?
In the current legal system, the regulations on types of companies, their bodies and manner of functioning, liability for the company’s obligations, and protection of creditors, derive in basically unaltered form from the Commercial Code of 1934. The 1990s saw the introduction of modern regulation of the capital market in Poland. The following decades led to adoption of the Commercial Companies Code, gradual harmonisation of corporate law with EU law, and introduction of regulations allowing the use of digital technology in the establishment of limited-liability companies and certain aspects of their functioning.
Mandatory websites for joint-stock companies
With the New Year, an amendment to the Polish Commercial Companies Code will enter into force requiring every joint-stock company or joint-stock limited partnership to maintain its own website for communicating with shareholders. The new obligation is motivated by the process of digitalisation of joint-stock companies, but is also designed to increase protection of shareholders’ rights.
The simple stock company
Funkcjonowanie spółek handlowych podlega ograniczeniom płynącym ze sztywnego gorsetu przepisów Kodeksu spółek handlowych. Od 1 marca 2020 r. należy się spodziewać istotnych zmian w tym względzie. Prezydent właśnie podpisał ustawę o prostej spółce akcyjnej.
The internationalisation of transactional agreements and borrowings from the common law
Along with the systemic transformation from the 1980s to 1990s and the inflow of foreign investment into Poland, the country was exposed to forms of contract already applied in international trade. It wasn’t that before then the law in Poland had been homogeneous and “truly Polish.” Historically, numerous factors contributed to the development of the Polish legal system, with a dominant role played by solutions from the German and French systems.
Resolutions of shareholders of a limited-liability company
When is it necessary to hold a shareholders’ meeting, and when can it be dispensed with? Comments under the amended provisions of the Commercial Companies Code
A new approach to dividends in limited-liability companies
For many companies in Poland, the 30th of June is the date set for holding their ordinary (annual) shareholders’ meeting. One of the points on the agenda should be adoption of a resolution on division of profit (or coverage of loss). The profit shown in the annual financial statement may be earmarked, among other things, to payment of a dividend to the shareholders. It seems like an opportune moment to examine the recent amendment of the regulations governing dividends in limited-liability companies.
Agile contracting: A slap on the wrist for lawyers
Genuine contractual disputes are always at least in some way about a gap in a contract. A dispute most often arises when parties have agreed to a meticulously drawn-up set of specific provisions and then in the course of performance a situation occurs which is not adequately addressed by those provisions. That is because the parties did not really have the situation in mind when drawing up the contract. As a result, the situation is either not addressed at all, or, more often, falls under provisions that were not really meant to deal with it.
Legal actions of a “false” corporate body can be saved. But all of them?
On 1 March 2019, an important amendment to the Civil Code comes into force, providing for the possibility of validating actions by a “false” corporate body. Up to now, such a possibility has applied only to actions by a “false” attorney-in-fact.
Powers, duties and liability of directors of a Polish LLC
Foreign managers appointed to serve on boards of Polish subsidiaries often do not know what they can do and what they must do. Consequently they are not aware of what liability goes with either of these. They should be.
Closing date of an M&A transaction and the right to participate in the general meeting of a non-public joint-stock company
The Commercial Companies Code regulates in detail the rules for shareholders’ participation in the general meeting of a joint-stock company. The resulting legal conditions should be taken into account when planning the timeframe for M&A transactions to adequately secure the rights of the buyer of shares, and in particular, the possibility for the buyer to participate in the general meeting of a non-public joint-stock company after the closing of the transaction.
Transfer of ownership of bearer shares and obligation to deliver shares
According to the applicable regulations, in order to transfer the ownership of shares, it is necessary to have a tangible element in the form of transfer of possession of registered shares or delivery of bearer shares. The transfer of ownership of registered shares additionally requires the conclusion of an agreement between the seller and the buyer (either on the share document itself or in a separate document), while the transfer of bearer shares may take place even without the conclusion of a formal agreement, through the mere delivery of the shares. Considering the significant legal consequences of delivering a bearer instrument, it is necessary to consider how to understand the term “delivery of shares”.
The good and the bad sides of representations and warranties – a few practical observations
Representations and warranties are a common feature in M&A transactions and derive from common law systems. The fundamental aim of representations and warranties is to properly divide risk between the seller and the buyer. In countries with an Anglo-Saxon legal system, statements made regarding the object of sale are in fact explicitly an element of ex delicto liability, as misrepresentation, and contractual liability as breach of warranty. The significance of statements of this kind in contracts governed by Polish law is not entirely clear and has been widely discussed in case law and legal literature. The conclusions reached are summarised below.