What are the legal structures of the Polish business entities ?
Establishing a company is a quick and inexpensive way to enter the Polish market. The choice of a suitable legal form is one of the first steps for entering the Polish market. In principle, the official language is Polish, so all documents must be in Polish. This also applies to communication with authorities.
Polish law offers a wide range of different business forms. These include:
Partnerships:
- General partnership (Spółka jawna, sp.j.)
- Partnership (Spółka partnerska, sp.p.)
- Limited partnership (Spółka komandytowa, sp.k.)
- Partnership limited by shares (Spółka komandytowo-akcyjna, sp. k.a.)
Corporations:
- Limited Liability Company (Spółka z ograniczoną odpowiedzialnością, sp. z o.o.)
- Joint stock company (Spółka Akcyjna, S.A.)
- Small joint-stock company (Prosta spółka akcyjna, P.S.A.)
The most commonly chosen legal form is the Limited Liability Company (Spółka z ograniczoną odpowiedzialnością, sp. z o.o.). It is one of the corporations and is a legal entity. This legal form can be used for companies of any size. It requires a notarial form and comes into existence by signing the founder’s agreement and registration in the Commercial Register. The minimum share capital is currently PLN 5,000 (approximately EUR 1,100), which is significantly less than the share capital required for a joint-stock company (PLN 100,000). The Limited Liability Company is liable up to the amount of the share capital.
What is the procedure for establishing a company and how long does the process take?
As part of the preparation for incorporation, in addition to the legal form, shareholder structure, the company name, licenses and permits must be checked.
A memorandum of association (in the case of several founders) is drawn up for the establishment of the company. In it must be included :
- the name of the Limited Liability Company
- the head office
- the business purpose
- the shareholders
- the number, type, and amount of shares
- the designation of the shareholders
The incorporation documents must then be notarized, and the notary fees are incurred according to the amount of the share capital.
The next step is the payment of contributions by the shareholders to cover the share capital. Then the application can be submitted to the registry court. Registration usually takes place after two to three weeks. The tax identification number (NIP) and the statistical number (REGON) are issued automatically. Otherwise, the employees still have to be registered, as well as the registration as VAT payers has to be done independently.
When establishing a Limited Liability Company (Spółka z ograniczoną odpowiedzialnością, sp. z o.o.) with the minimum registered capital, costs of at least PLN 2,000 are to be expected. These include, among others, notary fees, costs of drawing up the contract and registering it in the Commercial Register, costs of certifying signatures, and costs of VAT taxpayer registration.
The duration of the establishment of a Limited Liability Company in Poland is approximately 1 month.
