A company limited by shares is a legal vehicle for
conducting business in Poland that foreign
undertakings choose most often. An alternative to
that is the establishment in Poland of a branch office
of a company based abroad. Setting up of a branch of
a foreign company in Poland is governed by the
applicable legal regulations, including without
limitation the Act on Freedom of Business Activity
of 2 July 2004.
The Act on Freedom of Business Activity referred to
above, as currently stated, defines a branch as a
separate and organisationally independent part of a
business, operated by the undertaking outside its seat
or the principal place of business. Branches in
Poland can be set up not only by entities already
engaging in business activity and based in Poland
but also by foreign persons, i.e. natural persons
(individuals) who are not Polish citizens and legal
persons or other incorporated organisational units
with their seats outside Poland (the so-called foreign
persons).
Undertaking and conducting business activity by
foreign persons established in the EU Member
States, member states of the European Free Trade
Agreement (EFTA) – parties to the European
Economic Area Agreement, and foreign persons
from countries which are not parties to the EEA
Agreement but may exercise the economic freedom
under the terms of agreements concluded by those
countries with the European Community and its
Member States, and citizens of other countries than
those listed above who are holders of the relevant
permit in Poland, e.g. settlement permit, may
undertake and conduct a business activity in Poland
on the same terms and conditions as Polish citizens.
This means that those entities and persons may inter
alia establish branches of their own businesses.
Foreign undertakings based in countries other than
those listed above may set up branches in Poland on
a mutual basis (i.e. if the other state also allows the
establishment of branches in their territory by Polish
citizens) unless the ratified international agreements
provide otherwise.
A branch is established by filing a relevant
application with the appropriate Business Register
with effect upon registration. The application needs
to be accompanied by all the required enclosures and
documents. The establishment of a branch does not
require that the Articles of Association be drawn up
or the share capital accumulated, but the undertaking
setting up branches in Poland is required to designate
individuals holding the power to represent the
branch, separately for each of the branches.
The branch of a foreign undertaking operates in
Poland under the same business name as the main
part of the business setting up the branch and is
accompanied by the designation of the legal form of
the foreign undertaking translated into Polish. The
words oddział w Polsce (branch in Poland) are also
added to the business name. It must be borne in mind
that the branch may operate its business activity only
to the extent of the objects of business of the foreign
undertaking.
The branch of a business in Poland operates on a
stand-alone basis, manages its own finances,
maintains its own accounting (which must be in
Polish and comply with the Polish accounting
regulations), as well as drawing up its own financial
statements. However, branches are not vested with
separate legal personality. This means that the
foreign undertaking is liable without limitation for
the obligations of its branch.
MILLER, CANFIELD,
W. BABICKI, A. CHEŁCHOWSKI I WSPÓLNICY SP.K.
ul. Batorego 28-32
81-366 Gdynia
Tel. +48 58 782-0050
Fax +48 58 782-0060
gdynia@pl.millercanfield.com
ul. Nowogrodzka 11
00-513 Warszawa
Tel. +48 22 447-4300
Fax +48 22 447-4301
warszawa@pl.millercanfield.com
ul. Skarbowców 23a
53-125 Wrocław
Tel. +48 71 780-3100
Fax +48 71 780-3101
wroclaw@pl.millercanfield.com
Disclaimer: This publication has been prepared for clients and professional associates of Miller Canfield. It is intended to provide only a summary
of certain recent legal developments of selected areas of law. For this reason the information contained in this publication should not form the
basis of any decision as to a particular course of action; nor should it be relied on as legal advice or regarded as a substitute for detailed advice in
individual cases. The services of a competent professional adviser should be obtained in each instance so that the applicability of the relevant
legislation or other legal development to the particular facts can be verified.