Establishing a Business Presence in Poland: Step-by-Step Overview
The legal forms of doing business in Poland for both Polish and foreign investors, steps to start a business including registration, lease agreements, court registration, opening a bank account, and preparing Articles of Association for a limited liability company are outlined in this detailed guide.
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Project Welcome to the business land, LT-PL-2S-190 BUSINESS ESTABLISHMENT BUSINESS IN POLAND
ESTABLISHING A BUSINESS PRESENCE IN POLAND The legal forms of doing business in Poland available to Polish and foreign investors are as follows: a limited liability company (sp ka z ograniczon odpowiedzialno ci sp. z o.o.) a joint-stock company (sp ka akcyjna S.A.) a European Company (Societas Europea) (Sp ka Europejska SE) a general partnership (sp ka jawna sp.j.) a limited liability partnership (sp ka partnerska sp.p.) a limited partnership (sp ka komandytowa - sp.k.) a partnership limited by shares (sp ka komandytowo-akcyjna S.K.A.) a sole proprietorship (indywidualna dzia alno gospodarcza) a civil law partnership (sp ka cywilna) a Branch of a foreign enterprise (oddzia zagranicznego przedsi biorcy) Other investors (from third countries) may conduct their business under the same terms as citizens providedthattheyholdspecific permits to them to conduct a business activity. Such investors may carry on their business exclusively by: Establishing limited partnerships,partnerships limited by shares, limited liability companies and joint-stock companies; Purchasing and acquiring shares in such companies and partnerships; unless international agreements provide otherwise. Polish legalize their residence in Poland and allow
STEP-BY-STEP OVERVIEW OF WHAT YOU NEED TO DO TO START YOUR BUSINESS IN POLAND 5 key steps necessary to establish a fully operational limited liability company: Registration for VAT purposes Execution of lease agreement or acquisition of real estate The company needs to have a registered office in Poland. Therefore, it is important to have a legal title to some office space. The company may execute a lease agreement for its premises (or for a virtual office for the beginning of its business activity) or may acquire real estate. In case of long-term lease agreements it is necessary to have it properly prepared in order to avoid burdensome provisions that cannot be changed later on Registration in the Polish Court Register The next step required for the company to become fully operational is a registration with the Polish Court Register. In order to do that a motion should be prepared together with certain attachments and filed with the registry court. Registration by the registry court entails registration for tax purposes and in the Statistical Office Opening a bank account Preparation of Articles of Association in a form of notarial deed The Articles of Association have to include some basic information about the company indicated in the Code of Commercial Companies such as: business name, registered office, scope of business activities, the amount of share capital (minimum PLN 5000), nominal value of shares, number of shares taken up by the shareholders, the term of the company if it is defined. To the remaining extent provisions of the Code of Commercial Companies are applicable. However, much of them may be amended by the Articles of Association, therefore, it is crucial to discuss the scope and wording of the Articles of Association with the investor to made them tailormade The registration for VAT purposes
STEP-BY-STEP OVERVIEW OF WHAT YOU NEED TO DO TO START YOUR BUSINESS IN POLAND Polish law stipulates two ways of establishing a LLC: By execution of the AoA in front of a notary public By execution of the template of the AoA available through an IT system (via Internet) This article refers to the standard way of LLC s establishment by executing the AoA in front of a notary public (no. 1 above). Only this way enables the Shareholder(s) to prepare tailor-made AoA for the intended business activity. Concluding the AoA via special IT system (no. 2 above) does not allow to adopt every wording of the AoA but limits the wording to certain options only. These few options of the AoA wording may not be adequate for business activity intended by the Shareholder(s) and corporate governance rules adopted in the Shareholder(s) group. Additionally, in case of establishing the LLC via option no. 2 only cash contributions are allowed. Taking into consideration these limitations relating to option no. 2, foreign entrepreneurs wishing to establish their business presence in Poland often choose to execute the AoA before a notary public which gives them broader flexibility in terms of AoA wording.
STEP-BY-STEP OVERVIEW OF WHAT YOU NEED TO DO TO START YOUR BUSINESS IN POLAND
STARTINGA BUSINESS IN POLAND PROCEDURE, TIME AND COST Source: World Bank Report Doing Business 2018 Poland
PHASE 1: PREPARATORY PHASE OF STARTING BUSINESS IN POLAND No.Information required 1. Full name(s) and address(es) of the Shareholder(s) 2. Business name of the LLC Party Responsible Comments Please note that an LLC may not be incorporated by a sole shareholder being a single-member limited liability company. The business name may be chosen freely (unless it does not interfere with other existing business names) Name of a city in Poland, where the registered office of the LLC shall be located Description of activities to be performed by the LLC should be adjusted to the Polish classification of business activities The minimum share capital of the LLC is PLN 5,000. The minimum nominal value of one share is PLN 50. The share capital shall be paid up in full before registration. Cash or in-kind contributions. 3. Registered office of the LLC 4. Scope of the LLC business activities 5. Amount of the share capital of the LLC along with numer and nominal value of shares 6. Kind of contribution made by the Shareholder 7. Rules of representation of the LLC Shareholder(s) Unless the Articles of Association do not provide otherwise and the Management Board (MB) is composed more than one member, LLC, based on provisions of the CCC, shall be represented ny two MB members acting jointly or one MB member acting together with a registered proxy. MB members may be appointed either for indefinite or definite term of office 8. Term of office of the MB members
PHASE 1: PREPARATORY PHASE OF STARTING BUSINESS IN POLAND No.Information required 9. Fulll names and addresses of MB members 10. Supervisory Board Party Responsible Comments Supervisory board is not an obligatory corporate body of LLC, unless LLC share capital exceeds PLN 500,000 and there are more than 25 shareholders. 11. Intended date of commencement of business activity by the LLC 12. Place and business name of an entity responsible for keeping LLC books and documentation (if any) 13. Information on bank for the LLC s bank account Shareholder(s) The bank account may be opened after the AoA are executed or after the LLC is registered. In case of LLCs with relatively high share capital it is recommended to open the bank account before filing a motion for LLC s registration. Members of the MB signing statement that the contributions towards the LLC share capital have been made in full by all shareholders are liable for correctness of such statement. 14. Excerpts from a relevant commercial registers maintained for the Shareholders. Excerpt shall be legalized/apostilled if obtained outside of Poland.
PHASE 3: EXECUTION PHASE OF STARTING BUSINESS IN POLAND No.Information required 1. AoA of the LLC Party Responsible Comments The AoA should be executed in theform of a notarial deed. As of the moment of signing of the AoA, the LLC in organization is established. The LLC in organization may acquire rights and undertake obligations which will be transferred automatically to the LLC after its registration. AoA may be executed by a proxy appointed by Shareholder(s Shareholder(s) 2. Statements of members of the LLC MB on address and consent to the appointment 3. Statement of the LLC MB on payment of contributions by all shareholders of the LLC This document should be signed by all members of the LLC MB.MB The statement should be signed by all members of the LLC MB. It should be executed after receiving a confirmation from the Shareholder(s) on the payment of the contribution(s). This document should be signed by all members of the LLC MB. 4. List of shareholders of the LLC 5. Register of shares of the LLC 6. Information on the sole shareholder f the LLC (if applicable) 7. Copy of lease/sublease agreement This document should be signed by all members of the LLC MB.
SPECIAL ECONOMIC ZONES Poland has become a real magnet for investors both nationally and internationally mainly as a result of the incentives and SEZ allowances it offers investors. SEZs recently celebrated their 20-year anniversary. During this time, their impact has been significant. By 2012, SEZs had generated over EUR20 billion in total value investments and created over 186,000 jobs. They had transformed Poland and its economy into an attractive investment destination for foreign capital, which supported its transition to democracy. The figures that the Polish parliament published in 2016 confirm the significant regional impact of the different SEZs. At the end of 2016 the companies operating in Polish SEZs had 2,263 permits to conduct business activity within that year. The Ministry of Development estimated that in 2017, 14 SEZs may have attracted EUR5 billion in investments with 16,000 jobs. At the same time, every fifth project is implemented by a small or medium-sized company.
BUSSINESS CLIMATE: INWARD FOREIGN DIRECT INVESTMENT BY COUNTRY (EUR MILLION)
MONTHLY RENTAL OF OFFICE SPACE (EUR M2) City SQ.M MTH 23.75 Warsaw 14.50 Cracow 14.00 Gda sk
MONTHLY RENTAL OF WAREHOUSE SPACE (EUR M2) Class A&B Warsaw 4.1 - 5.1 Cracow 3.8 4.5 Pozna 2.8 3.5
UTILITY COSTS (EUR, EXCL. VAT) Measurement Average rates Electricity 1 kWh 0.062 - 0.084 Eur Natural Gas 1 MWh 18.5 - 27.3 Eur Cold drinking water 1 cubic meter 1.29 Hot drinking water 1 cubic meter 4.17 Eur
SOURCES EY. Doing Business in Poland, 2017. Polish Agency for Enterprise Development https://www.parp.gov.pl/ PricewaterhouseCoopers UAB.Doing Business in Poland, 2017. World Bank. Doing Business Poland, 2018.
About the project The project Welcome to the business land (LT-PL-2S-190) is aimed at showing the border region youth that Business can be simple, if you have a good idea, some support from professionals and general knowledge on business processes. During its implementation, it is planned to organize business leader s competition and International Economic Forum and to activate partnership of project beneficiaries and social partners (schools, business companies, professional development centers). This training material has been produced with the financial assistance of the European Union. The contents of this training material are the sole responsibility of PI PVC and Euroregion Niemen Association and can under no circumstances be regarded as reflecting the position of the European Union. Total projects size is 49 973, 25 EUR. Out of them co-funding of European Regional Development Fund is 42 477,25EUR. This project is Partly financed from the European Regional Development Fund Interreg V-A Lithuania-Poland cooperation programme www.bonusLT-PL.eu
