Ladies and Gentlemen, In 2021, regulations amending the Commercial Companies Code regarding the dematerialization of shares will come into force. Furthermore, the legislator also plans to introduce a new company – the Simple Joint-Stock Company (hereinafter " PSA ") – and holding law into Polish commercial law this year.
Dematerialization of shares
On March 1, 2021, due to the obligation to dematerialize shares in limited joint-stock partnerships and joint-stock companies, share documents lose their legal force and on that date, entries in the register of shareholders maintained by an entity authorized to maintain securities accounts (e.g. a brokerage house) become effective.
The tasks of companies subject to the obligation to dematerialize shares have so far included establishing a company website for shareholders’ information purposes, reporting the company’s website address to the National Court Register, adopting a resolution on the selection of the entity maintaining the shareholder register, concluding an agreement with the relevant entity for maintaining the shareholder register, and calling on shareholders to submit share documents.
Many companies have still not fulfilled the above-mentioned obligations, which should be done immediately under pain of a fine of PLN 20,000.
Simple joint-stock company
On March 1, 2021, a new legal form of company – a simple joint-stock company – will enter into force in Polish law. It is designed to combine the features of a limited liability company and a joint-stock company. A simple joint-stock company (PSA) is primarily intended for startups using modern technologies but encountering formal challenges. Any entrepreneur who is comfortable with running a business in this form can take advantage of the opportunities offered by a PSA. A PSA is designed to minimize formalities and digitalize procedures, in particular:
- The required share capital is only PLN 1,
- Opportunity to contribute in the form of know-how, services or work,
- Possibility of electronic company registration,
- Freedom in constructing company provisions,
- An organizational structure enabling the election of a board of directors instead of a management board (combining supervisory and executive powers)
- Rapid transformation and liquidation of PSA
Holding law
Last year, a draft Act of 20 July 2020 amending the Commercial Companies Code and certain other acts in the part concerning corporate groups, also known as corporate law, was drafted. The draft was developed by a team appointed by the Minister of State Assets.
Project assumptions:
- The subsidiary should be guided by the interests of the group
- The parent company will be able to issue binding orders to the subsidiary
- The provisions relating to the parent company are to be applied accordingly to cooperatives, foundations and investment funds
Other changes envisaged by the project:
- Strengthening the role of supervisory boards
- Unification of the term of office and mandate of members of company bodies
- Obligation to record resolutions of management boards of limited liability companies
The draft law, in the scope described above, raises skepticism among commercial law experts, including regarding the possibility of violating the principle of state subsidiarity enshrined in the Polish Constitution, EU regulations, and OECD standards. At the time of this alert, the date of the law's entry into force is unknown.
