Call to stockholders to submit share documents in connection with the dematerialization
In earlier entries, we have already informed our clients about the obligation to dematerialize stocks that have covered all joint-stock companies in Poland. This time, we want to present in detail the statutory requirements regarding calls to stockholders to submit stock documents to the company’s management board. Compliance with all formalities related to notifications of stockholders is extremely important, as in the event of violations in this regard, the management board will face severe fines.
The first step – website
It should be noted that, starting from January 1, 2020, i.e. from the date of entry into force of certain provisions of the Act amending the Commercial Companies Code, an additional and obligatory way of communication between a joint-stock company and stockholders will be publication of announcements on the company’s website. Therefore, starting from this date, setting up a website with a dedicated space for publishing information for stockholders is mandatory. If the management board of the company has not fulfilled this obligation so far, it is worth doing it as soon as possible so as not to be exposed to the accusation of informing the stockholders about the obligation to submit share documents in the company.
Choosing the entity holding the stockholders register
It is worth remembering that before making the first call to stockholders to submit share documents, non-public joint-stock companies are obliged to conclude an agreement with an entity authorized to keep securities accounts (e.g. with a brokerage house or a bank) or agreement to register shares in the securities depository if this form was chosen by the company.
The entity indicated above is selected by the general meeting of stockholders, which must be convened by the management board before June 30, 2020, when the deadline for making the first call to stockholders expires. In practice, in order to optimize costs, in most non-public joint-stock companies, the resolution on the selection of the authorized entity will be taken during the ordinary general meeting of the company, at which the company’s financial statements for the previous year will also be approved.
Form of call
Calls to stockholders of non-public companies will have to be made in the manner provided for convening a general meeting of the company, i.e. by announcement in the Court and Economic Monitor (MSiG) at least three weeks before the date of the meeting.
If all stocks issued by a private company are registered, the general meeting may be convened by registered letters or parcels sent by courier, sent at least two weeks before the date of the general meeting.
The possibility of informing stockholders in non-public companies whose all stocks are registered also exists in the form of e-mail, however in this case it will be necessary to obtain the written consent of the stockholder for this form of communication. Starting from January 1, 2021, this option will be available in all types of JSC’s, and the email addresses of stockholders will be indicated in the stockholders’ register.
The general meeting of a public company is convened by an advertisement placed on the company’s website and through a specialized information agency. The announcement should be made at least twenty-six days before the date of the general meeting.
Announcements addressed to stockholders of all types of companies should also be published on the company’s website.
The provisions on the informal convening of a general meeting in the event of calls from stockholders will not apply.
Number and dates of making calls
The Act imposes strict requirements on the frequency and number of calls. Calls for submitting share documents to shareholders should be issued five times, at minimum intervals of two weeks, but not longer than 1 month.
The first call should be made by June 30, 2020.
The Act does not provide for any facilities or exemptions from such frequent and repeated summoning of stockholders, so the schedule of summons should be strictly followed under the threat of imposing fines and the risk of raising allegations of improper notification by stockholders.
Responsibility for failure to call
For violation of regulations regarding making calls on stockholders to submit share documents in the company, management board members may face a fine of up to PLN 20,000.