Shareholders Meeting in Polish Companies

Company Shareholders Meeting in Poland

In Polish Company Law Shareholders’ Meeting is one of the four governing bodies of the Polish company (next to the company’s Management Board, the Supervisory Board and the Audit Committee). The Shareholders’ Meeting is a legislative body making decisions concerning company’s key issues. It is based on the art 227 of the Commercial Companies Code (POLISH COMPANY LAW ACT), which states that the resolutions of the shareholders shall be adopted at the General Shareholders’ Meeting of Polish Company. However, resolutions may be adopted without holding a General Shareholders’ Meeting if all the shareholders consent in writing to the decision to be taken or to a written vote. The General Shareholders’ Meeting is, next to the Management Board, one of the two governing bodies essential to the company’s existence.

Conveying Shareholders Meeting in Poland

In the ordinary course of business, the General Shareholders’ Meeting in Poland is convened by the Management Board once a year at the end of the financial year (it is then called ” The Ordinary General Meeting”) in order to approve the balance sheet and profit and loss account of the Company as well as to discharge the other governing bodies of the company. In Poland the Ordinary General Meeting shall be held within six months of the end of each financial year (if the financial year corresponds to the calendar year, the Meeting shall be held by June 30 of the next calendar year).

The General Shareholders’ Meeting may be convened at any other time where the Company’s interest requires it or where a large enough group of shareholders (usually shareholders representing at least 10% of the share capital, although the company’s articles of association may indicate a different percentage of share) requests that the Meeting be convened. This type of meeting is referred to as ” The Extraordinary General Meeting“. In this case, if the Extraordinary General Meeting of Polish Company is not convened within two weeks of the submission of the request to the Management Board, the registry court may, having summoned the management board to make a representation, authorize the shareholders who have submitted the request to convene the Extraordinary General Meeting. The court shall designate the chairman of such a Meeting and this Meeting shall adopt a resolution determining whether or not the costs of convening and holding the meeting shall be borne by the company.

Although in Polish Companies Shareholders’ Meeting is usually convened by the Management Board, the Supervisory Board as well as the Audit Committee – if created – also have a right to convene the Ordinary General Meeting (if the Management Board fails to convene it at the time stipulated in this division of the POLISH COMPANY LAW ACT or in the articles of association), and the Extraordinary General Meeting (if they consider it desirable that it should be convened, and the Management Board fails to convene the General Meeting within two weeks of the date when the Supervisory Board or the Audit Committee file the relevant request). The  articles of association of Polish Company may grant the right to convene the General Shareholders’ Meeting to other persons also. If the balance sheet drawn up by the Management Board shows a loss exceeding the aggregated supplementary and reserve capitals and half of the share capital, the Management Board shall immediately convene the Extraordinary General Meeting so that a resolution on the continued existence of the company can be adopted.

Decisions of Shareholders Meetings in Poland

Decisions of the Shareholders’ General Meeting shall take precedence over any activities of the other company governing bodies and may be appealed only to the court, which may repeal them, but only if it would deem them contradictory with the overriding law (e.g.  with the POLISH COMPANY LAW ACT), or if the decision was taken in violation of the procedure. The resolution is an expression of the will of the shareholders and applies to all members of the governing body adopting it. The resolution of the Shareholders’ General Meeting takes effect within the company in such a way that it obliges the Management Board and allows it to take action to implement the given resolution. However, in external relations, in relation to third parties – the resolution of the Shareholders’ General Meeting does not produce any legal effects. Only in certain cases the lack of resolution produces the legal consequences since it may render the agreement adopted by the company’s Management Board void.

Voting at Shareholders meetings in Poland

The rule is that voting during the Shareholders’ General Meeting is open, however, the POLISH COMPANY LAW ACT provides for an exception to this rule. A secret vote shall be ordered for elections and with regards to motions for the dismissal of members of the company governing bodies or liquidators, to enforce their liability and in personal matters. Also, a secret vote shall be ordered whenever requested by at least one shareholder present or represented at the General Shareholders’ Meeting. The General Shareholders’ Meeting may resolve to refrain from a secret vote in elections of a committee appointed by the General Shareholders’ Meeting.

In accordance with art. 245 of the Polish Company Law Act, the resolutions shall be adopted by an absolute majority of votes, that is at least 50% of votes + 1 vote, however, in the absolute majority calculation abstention votes are also taken into account. Resolutions on amendments to the articles of association, the dissolution of the company or a transfer of the enterprise or its organized part shall be adopted by a majority of two thirds of the votes. A resolution on a substantial change in the objects of the company shall require a majority of three fourths of the votes. Moreover, a resolution on amendments to the articles of association of the company providing for an increase in the performances of the shareholders or a limitation of the share rights or the rights granted personally to individual shareholders shall require the consent of all the shareholders concerned.

Presence at Shareholders meeting in Poland

In accordance with art. 241 of the Polish Company Law Act, unless the provisions of this Division or the articles of association provide otherwise, the General Shareholders’ Meeting shall be valid irrespective of the number of shares represented. It is the will of the shareholders to decide whether to use the right to participate in the meeting and to vote. However, the shareholders in the articles of association may require the participation of a certain amount of shareholders (quorum) at the General Shareholders’ Meeting. Such a meeting is valid if the above mentioned condition is met. It should be emphasized that the requirement stipulated in the articles of association applies to each resolution adopted at the General Shareholders’ Meeting. Thus, the quorum required in the articles of association must be maintained throughout the duration of the General Shareholders’ Meeting. The presence of the required capital is necessary not only when verifying attendance, but also when adopting specific resolutions. Consequently, the absence of the part of the share capital at an important meeting results in the Meeting losing the right to adopt resolutions.

Derogation from the principle that the General shareholders’ meeting shall be valid irrespective of the number of shares represented may also derive from the law:

• the adoption of a resolution unforeseen in the General Shareholders’ Meeting agenda or preventing company’s dissolution requires a full representation (100 percent quorum)
• at least half of the share capital and a qualified majority of three fourths of the votes is required for adoption of a resolution on the merger of the companies or transformation of a company into a joint-stock company or vice versa.

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