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Draft Amendment to the Commercial Companies Code

Draft Amendment to the Commercial Companies Code

Poland
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On 8 August, the latest draft amendment to the Commercial Companies Code was published. The bill implements Directive (EU) 2019/2121 of the European Parliament and of the Council of 27 November 2019 amending Directive (EU) 2017/1132 as regards cross-border conversions, mergers and divisions.

The aim of the amendment is to introduce new institutions into the Polish legal framework, such as cross-border division and conversion, and division by separation.

The legality of cross-border operations is also to be scrutinised to a much broader extent, which is to include the requirement that operations be scrutinised by the tax authorities.

New solutions in the Polish Commercial Companies Code

The changes included in the bill are intended to enhance the possibilities of conversion of Polish companies and partnerships via:

  • introducing solutions analogous to those provided for in cross-border procedures (simplified mergers, and a new type of division – division by separation),
  • granting full merger and division capacity to limited joint-stock partnerships; and
  • simplifying company reorganisation procedures to increase the competitiveness of Polish entities on the single market.

Protection of members, employees and creditors

The bill also contains provisions to protect groups of entities whose interests could be affected by a cross-border conversion, division or merger of a company, namely:

– minority members, who will:

  • be able to submit comments on the planned cross-border operation;
  • receive a report setting out the implications of the cross-border operation in question;
  • receive a compensation for their shares assessed by an independent expert;

– creditors, who will be able to:

  • apply to court for adequate safeguards for their claims;
  • submit comments on the planned cross-border operation;
  • institute proceedings against the company also in the Member State of the company being converted; and

– employees of the company carrying out the cross-border operation, who will:

  • be able to submit comments on the planned cross-border operation;
  • receive a report setting out the implications of the cross-border operation in question;
  • be able to provide their opinion on the report.

Exchange of information between member state registers

The implementation of Directive 2019/1151 is also intended to enable the exchange of information on disqualifications of directors between the registers of EU (EEA) Member States in order to enhance the security of trading within the single market.

The exchange of information will concern relevant data collected in the National Criminal Register (Krajowy Rejestr Karny), the Register of Insolvent Debtors (rejestr dłużników niewypłacalnych), the National Debtors Register (Krajowy Rejestr Zadłużonych) and a list provided by the Financial Supervision Authority (KNF) .

According to a notice published by the Ministry of Justice, the amendments to the Commercial Companies Code are due to be adopted in Q3 2022 and (for the most part) to come into force at the end of January 2023.

By Aneta Serowik, Counsel, and Rafal Rapala, Partner, Kochanski & Partners