POLAND Law and Practice Contributed by: Agnieszka Janicka and Krzysztof Hajdamowicz, Clifford Chance
Most Common Forms of Legal Entities in Poland Limited liability company A limited liability company ( spółka z ograniczoną odpowiedzialnością , or sp. z o.o.) is the most popular form of corporate vehicle in Poland, which can be established for nearly all business purposes, except in situations where the appli - cable law requires another form of legal entity (only a joint stock company can be listed on the stock exchange). The minimum share capital of a limited liability company is PLN5,000, and the nominal value of one share may not be less than PLN50. There is no minimum number of shareholders, so the company may have only one shareholder. However, the company may not be formed by another sole-shareholder limited liability company. The governance structure includes the following corporate bodies. Management board The management board manages the affairs of the company and consists of at least one mem - ber appointed from among the shareholders or outsiders. Unless the articles of association pro - vide otherwise, the members of the management board are appointed and dismissed by way of a resolution passed by the shareholders’ meeting. Shareholders’ meeting The shareholders’ meeting makes the decisions on the company’s most crucial affairs, as stipu - lated in the articles of association or in the Com - mercial Companies Code, which distinguishes between “ordinary” and ”extraordinary” share - holders’ meetings. The first must be held within six months of the end of each financial year and should adopt resolutions to approve: • the management board report;
• the financial statement for the previous finan - cial year; • the distribution of profits or financing of losses; and • the discharge of duties by members of the company’s corporate bodies. Supervisory board A supervisory board or audit committee is optional as long as the company’s share capi - tal does not exceed PLN500,000 and there are no more than 25 shareholders; if appointed, it must be composed of at least three persons. The role of the supervisory board is to exercise day-to-day supervision over all areas of the company’s activity. It may give the management board instructions, but they are not binding. The audit committee’s duties are limited to reviewing the financial statements and the management board’s motions to distribute profit and cover loss. The shareholders of a limited liability company are not personally liable for the company’s lia - bilities. The company is treated as a legal entity separate from its shareholders, so the share - holders may lose only their investment in the company. A limited liability company is quite a flexible vehi - cle, suitable for numerous purposes. Joint stock company In general, a joint stock company ( spółka akcyjna , or S.A.) is quite similar to a limited liability com - pany in its three corporate bodies (the general meeting, the management board and the super - visory board), which share most characteristics and competences. The fundamental difference is that a joint stock company may raise its capital by public subscriptions and issue shares in the form of securities, so the form is usually used
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