New regulations regarding capital companies, being part of the so-called small and medium-sized enterprises package (SME package), have been in force since 1 March 2019. The SME package introduced changes in tax law, labour law, and the commercial companies code that are to provide simplifications for entrepreneurs – as results from the title of the Act of 9 November 2018 amending certain acts in order to introduce simplifications for entrepreneurs in tax and economic law. While the other provisions of the package came into force at the beginning of the year, vacatio legis for the provisions amending the commercial companies code was three months and, as such, the changes did not take effect until March. The most important of them will be discussed below.
One of the key changes concerns the resignation of management board members of limited liability companies and joint-stock companies. Paragraph 6 was added to Article 202 and paragraphs 51 and 52 were added to Article 369. According to the amendment, the sole member of the management board may no longer “abandon” a capital company – when submitting his or her resignation from the office, s/he will be required to convene a shareholders’ meeting at the same time. A statement of resignation should be attached to a notice of the meeting and does not take effect until on the day following the scheduled date of the meeting. The change is aimed to avoid the situation where a vacant office of a management board member prevents a company from operating, in particular where no proxies have been appointed in the company. The procedure also applies in joint-stock companies, with the modification that it will apply only if no vacancy in the supervisory board is filled. As a result, the last management board member will be forced to remain in the company for such period as is required to convene the meeting. These changes are assessed as somewhat arguable. This will definitely require modification of certain standard operating procedures in economic dealings, e.g., in the case of post-closing activities under share deal transactions.
The change regarding resolutions that may be adopted in a written vote is a significant improvement for entrepreneurs. As of 1 March 2019, resolutions that should be the subject of an annual meeting of shareholders in a limited liability company (approval of financial statements for the previous financial year, adoption of resolutions on profit distribution or loss coverage, and on acknowledgement of the fulfilment of duties by management board members) may also be adopted in a written vote. Therefore, there will be no need for the physical presence of shareholders at the meeting or for granting any powers of attorney. The operation of companies in this respect will be significantly streamlined. However, the amendment does not dispel all doubts as it is not apparent whether a written vote may apply to resolutions that require a secret vote.
Another important modification is a company’s right to confirm a contract concluded without or beyond the scope of authority – in relation to persons that have concluded a contract as a body of a legal person without being duly authorised to do so. An amendment to Article 39 of the Civil Code allows an activity to be confirmed by a legal person on whose behalf the activity was effected. As such, any defects resulting from improper appointment of the body will be capable of remedy, which is of great practical importance.
Other changes relate, among others, to changes in articles of association of a limited liability company in organization (it has been resolved that unanimity by all shareholders is required in this respect), cancellation of a meeting in a limited liability company (this right is vested in the entity that has convened the meeting), and the determination of a dividend date in a limited liability company.
These changes tend to have an actual positive impact on the functioning of capital companies and to streamline a number of procedures. Insofar as the provisions concerning the resignation of the last management board member impose additional obligations, their introduction – from the practical point of view of the legislator – is understandable.