Newsletter

Dear Readers,

 

In the November issue of our newsletter, we highlight the proposed amendments to the National Court Register Act, which may have a significant impact on commercial companies. We also present the greatest risks for Polish employers resulting from the planned changes extending the powers of the National Labour Inspectorate. Finally, we draw your attention to the main assumptions of the draft amendment to the Commercial Companies Code, which recently appeared in the government’s list of legislative work.

 

Enjoy your read,

WBW Team

 

 

 

Will company activities before the National Court Register become more complicated than before?

Sebastian Michalak, senior lawyer 

 

The draft amendment to the Act on the National Court Register, prepared by the Ministry of Justice, is available on the website of the Government Legislation Centre under list number UDER49. The Act is to introduce several far-reaching changes for entrepreneurs operating as commercial companies.

 

Obligation to attach anonymised extracts from documents to applications

 

The most important change that commercial companies may face is the introduction of an obligation to attach to each pleading in proceedings before the National Court Register an extract omitting personal data or other data whose right of access is restricted under a specific provision. This will apply to situations where a procedural document or a document attached to a letter contains personal data or other data whose viewing rights are restricted under a specific provision.

 

In practice, this will necessitate verification that pleadings or attached documents do not contain personal data or confidential information, and if the result of such verification is positive, the obligation to prepare an extract from that document. Due to the specific nature of registration proceedings and documents submitted to the National Court Register, in practice almost all documents submitted to the National Court Register will be subject to anonymisation, which will complicate the entire process and impose additional costs on businesses.

 

Submitting an application to the KRS in violation of the obligation to attach an anonymised extract may result in the application being returned. However, the consequences of a situation where the court examines the application despite such a deficiency and, as a result, discloses documents containing data subject to anonymisation in the registration files seem unclear.

 

Obligation to have legal title to the registered office

 

At present, registry courts do not, as a rule, examine a company’s legal title to the property whose address has been indicated as its registered office, and a resolution of the competent authority is sufficient for entry in the National Court Register. In practice, there are no obstacles for companies to use so-called virtual offices, which serve solely to provide the company with an address for its registered office.

 

The draft amendment provides that representatives of a company registering its registered office address will be required to submit a statement, under penalty of criminal liability, that the company has the title to use the property whose address is being registered with the National Court Register. This may lead to doubts in the case of virtual offices, which do not provide any legal title to use the property where the company’s registered office is to be located.

 

Failure to submit a report on time with more serious consequences?

 

Until now, exceeding the deadline for submitting financial statements to the National Court Register – usually mid-July each year – did not usually lead to any major consequences in practice, provided that the obligation was fulfilled within the following months. The workload of registry courts – especially in large cities such as Warsaw, Poznań, Wrocław and Kraków – means that courts sometimes initiate enforcement proceedings several years after the obligation to submit financial documents to the KRS arose.

 

The amendment is intended to introduce a system of automatic notification of the court about the entry of financial documents, which is supposed to help automate the control of companies that have not fulfilled their reporting obligation on time. Furthermore, importantly, in the event of enforcement proceedings being initiated to enforce the obligation, failure to comply with the court’s request will result in the immediate notification of the head of the tax office of a suspected offence. This will replace the much milder regime of fines imposed by the registry court under civil procedure rules and may lead to much more severe consequences for commercial company managers in terms of criminal liability. 

 

 

The burden of an incorrect decision by the Labour Inspectorate on the employer?

Sebastian Michalak, senior lawyer

Aleksandra Urbańska, senior lawyer

 

In the August edition of our newsletter, we reported on ongoing legislative work on amending the State Labour Inspection Act, which is intended to empower the Labour Inspection Authority to reclassify civil law relationships as employment relationships. In the meantime, the draft has undergone significant changes, and the latest draft of the Act was published in November. What are the biggest risks for employers arising from the current content of the draft?

 

Immediate enforceability of OIP decisions

 

One of the latest proposed changes is the introduction of immediate enforceability of decisions of the Regional Labour Inspector with regard to the effects that labour law provisions attach to the establishment of an employment relationship from the date of its delivery to the employer. The enforceability of the decision will not be suspended by an appeal or complaint to the court.

 

However, the immediate enforceability of OIP decisions may be revoked in special circumstances by the General Labour Inspector or by a court in subsequent appeal proceedings.

 

An erroneous decision of the OIP still has consequences for the employer

 

Another noteworthy change is the maintenance of the employment relationship, confirmed by the decision of the Regional Labour Inspector, which will be revoked in subsequent appeal proceedings, from the moment the decision is delivered to the employer until the date of its final revocation. This means that the employer will not recover the costs incurred for additional public law charges other than through compensation from the State Treasury for issuing an unlawful decision.

 

Retroactive determination of the existence of an employment relationship

 

The new version of the draft limits the period for which a decision confirming the existence of an employment relationship may be issued to a maximum of three years retroactively, counting from the date of initiation of proceedings by the Regional Labour Inspector.

 

Other significant changes

 

The draft extends the deadline for appealing against an OIP decision from 7 days to 14 days. Any court case following an appeal against the decision may be settled, but only with the consent of the Chief Labour Inspector. If the Regional Labour Inspectorate is unable to determine the content of the employment relationship, it shall assume that the parties are bound by a full-time employment contract with minimum remuneration. The court with jurisdiction to hear an appeal against a PIP decision will be the court with jurisdiction over the place of work (until now, it was the court with jurisdiction over the Regional Labour Inspector who issued the contested decision).

 

What will happen next with the proposed changes?

 

At present, the draft bill is still at the consultation and agreement stage. We do not know the date of its adoption by the Council of Ministers and its submission to parliament, but the Ministry of Labour and Social Policy’s goal is still for the changes to come into force on 1 January 2026.

 

 

Planned liberalisation of the rules for participation in the shareholders’ meeting of a limited liability company

Sebastian Michalak, senior lawyer

 

On 4 November, the list of legislative and programme work of the Council of Ministers included information about a draft amendment to the Commercial Companies Code regarding the adaptation of the rules for participation in shareholders’ meetings of limited liability companies to digital standards. According to the assumptions, the draft will introduce two main changes:

1)  replacing the current written form required for a shareholder’s consent to the electronic delivery of invitations to shareholders’ meetings of limited liability companies with a documentary form (e.g. by e-mail or a scan of a signed document);

2)  authorising shareholders to specify in the articles of association of a limited liability company a less stringent form of power of attorney to participate in a shareholders’ meeting, i.e. a documentary form instead of the statutory written form.

 

The first of these changes will not have a significant impact on the functioning of limited liability companies in practice, as the current written form for the consent of a shareholder who wants invitations to shareholders’ meetings to be delivered to them by email is not reserved under pain of nullity, which means that if the consent is sent to the company in the form of a scan, there are no grounds for challenging its validity.

 

However, the second change may be a great convenience for shareholders of limited liability companies. Currently, a power of attorney to participate in a shareholders’ meeting must be in writing under pain of nullity, which is particularly burdensome for persons residing abroad who wish to authorise someone locally to participate on their behalf in a shareholders’ meeting. Allowing shareholders to relax this requirement by allowing the use of a document form will therefore be a significant change for the better for shareholders of limited liability companies.