Polish company formation (or generally setting up a business in Poland) is a process, which concluded allows you to run your own business activity at the territory of Poland, EU and in principle world-wide. The issue itself is generally simple if you are an EU citizen, which grants you the same rights as being a citizen of Poland. The same rights are also granted to a person who is not an EU citizen, but fulfills other requirements stipulated in the law, e.g. has a permission of a permanent residence in Poland or a permission of a long-term residence in EU or a temporary residence in EU granted under certain circumstances. The other persons are allowed to run a business in Poland too, though only in certain forms such as registered partnership (“spółka jawna”), professional partnership (“spółka partnerska”), limited partnership (“spółka komandytowa”), limited joint-stock partnership (“spółka komandytowo-akcyjna”), limited liability company (“spółka z ograniczoną odpowiedzialnością”) or joint stock-company (“spółka akcyjna”).
Registration of a business activity in Poland and subsequent completion of all related formalities may be an obvious challenge for a foreigner, but it is often difficult also for experienced Polish entrepreneurs. Due to the variety of forms of doing business and the requirements related to their establishment and registration, I strongly recommend you to make a thoughtful decision, hoping you will find the information provided below usefull.
As an attorney-at-law experienced in company formation under Polish law and organization of various forms of business activity, I offer you my services to prepare the documents required by law, fulfill all formalities and register your business activity in Poland. Should you need my assistance, please contact me under the following contact details: contact me.
Polish company formation (setting up a business in Poland) – forms of running business and their registration
There are several forms (mostly companies) of running business in Poland. An appropriate form of doing business should be chosen depending on the scale of the planned business activity and expectations of an entrepreneur. The basic and most common forms of running business in Poland include: a sole proprietorship, partnerships (i.e. a registered partnership, a professional partnership, a limited partnership and a limited joint-stock partnership), capital companies (i.e. a limited liability company and a joint-stock company), associations and foundations. Each of these forms has its own distinctive features and may be subject to restrictions or give an entrepreneur additional benefits.
I. The simplest and most common form of running business is a sole proprietorship, designed rather for small businesses. In this case, the entrepreneur is personally responsible with all of his personal assets for any debts and obligations of his firm. This form of business activity shall be registered in the Central Register and Information on Economic Activity (“Centralna Ewidencja i Informacja o Działalności Gospodarczej”) by submitting an appropriate form to the municipality or the district office. The entrepreneur is given the REGON number (number of the Statistical Office) and NIP number (number of the Tax Office), unless he already has one. Generally, additional formalities shall be fulfilled in the Social Insurance Institution (“Zakład Ubezpieczeń Społecznych”), as well as in the Tax Office if the entrepreneur is a VAT payer. The entrepreneur should also have his own bank account for the business operations. To facilitate formalities and running business activities, it is also advisable to create a company stamp, though it is not necessary.
II. A more complex form of running business is a partnership, and there are four types of such company stipulated in the Code of Commercial Companies. A partnership is a separate entity from its partners, being an entrepreneur from the legal point of view.
(i) The basic type of partnerhip is a registered partnership (“spółka jawna”). Creation of such company requires the conclusion of the articles of association of the registered partnership in writing by at least two persons and registration in the National Court Register (“Krajowy Rejestr Sądowy”). The partners of a general partnership are jointly and severally liable for the obligations of the company.
(ii) A special type of partnership is a professional partnership (“spółka partnerska”), intended for the exercise of liberal professions (e.g. lawyer, doctor, architect) by at least two partners authorized to practice liberal professions. As a rule, each partner of a professional partnership is not financially responsible for the obligations of the company arising in connection with the performance of liberal professions in the company by the other partners or their employees. Creation of such company also requires the conclusion of the articles of association of the professional partnership in writing and registration in the National Court Register (“Krajowy Rejestr Sądowy”).
(iii) Another type of partnership is a limited partnership (spółka komandytowa), which is primarily characterized by the diversity of liability of the partners and their influence on the operations of the company, depending on their status in the partnership. At least one partner in a limited partnership (a general partner) is responsible for the obligations of the company with all his personal property, however, having the greatest influence on the operations of the company, while the other partners (limited partners) are only liable up to the amount declared in the articles of association, however, having limited influence on the operations of the company. Creation of a limited partnership requires the conclusion of the articles of association of the limited partnership in the form of a notarial deed and registration in the National Court Register (“Krajowy Rejestr Sądowy”).
(iv) The types of partnerships also include a limited joint-stock partnership (“spółka komandytowo-akcyjna”), which, even more than a limited partnership, differentiates the liability of partners and their influence on the operations of the company, depending on their status in the company. At least one partner of a limited joint-stock partnership (general partner) is responsible for the obligations of the company with all its personal assets, having the greatest impact on the operations of the company, while the other partners (shareholders) are not liable with their personal assets for the obligations of the company, but their influence on the operations of the company is also limited. To establish a limited joint-stock partnership, it is necessary to contribute to the company share capital in the amount of at least PLN 50,000, sign the statute by the founders of the company in the form of a notarial deed and registration in the National Court Register (“Krajowy Rejestr Sądowy”).
III. The most complex form of running business activity is a capital company, which is stipulated in two basic types in the Code of Commercial Companies. A capital company is a legal person, i.e. a separate entity from its shareholders, being an entrepreneur from the legal point of view.
(i) A simpler type of capital company, one of the most often chosen type of a Polish company, is a limited liability company (“spółka z ograniczoną odpowiedzialnością”). This company can be created by one or more shareholders and is characterized by the lack of financial liability of the shareholders for the obligations of the company. The operations of the company are managed by a board of directors, supervised by a supervisory board or an audit committee (mandatory only in certain circumstances), and the shareholders retain some influence over the affairs of the company through the general meeting of shareholders. For the establishment of a limited liability company it is necessary to make contributions to the company to cover the share capital in the amount of at least PLN 5,000, conclusion of the articles of association of the limited liability company in the form of a notarial deed, appointment of a management board, establishment of a supervisory board or an audit committee (if required) and registration in the National Court Register (“Krajowy Rejestr Sądowy”).
(ii) A more complex type of capital company is a joint-stock company (spółka akcyjna). This company can be created by one or more shareholders and is characterized by the lack of financial liability of the shareholders for the obligations of the company. The operations of the company are managed by a management board supervised by the supervisory board, and shareholders retain some influence over the affairs of the company through the general meeting of shareholders. To establish a joint-stock company, it is necessary to acquire all of the shares of the company by the shareholders, make contributions by the shareholders to cover the share capital in the amount of at least PLN 100,000, prepare the statute of the company and consent of the founders in the form of a notarial deed (to establish a joint-stock company, approve the statute and for acquisition of the shares), as well as establishment of a management board and supervisory board and finally registration in the National Court Register (“Krajowy Rejestr Sądowy”).
Summary
(i) Establishing Polish company (setting up a business activity in Poland) is a process that differs significantly depending on the chosen form of running future business activity. Generally, it is always necessary to prepare the relevant documents and register a company (or other form of doing business) in the appropriate register.
(ii) The selection of the appropriate form of running business is of great importance for the entrepreneur, as it determines the extent of his influence and direct control over the business, the extent of the liability of the entrepreneur with his personal assets for the obligations of the company, the amount of funds necessary to establish a business and the amount of tax receivables.
As an attorney-at-law experienced in company formation under Polish law and organization of various forms of business activity, I offer you my services to prepare the documents required by law, fulfill all formalities and register your business activity in Poland. Should you need my assistance, please contact me under the following contact details: contact me.
