Updated: 31.10.2024
A limited liability company (spółka z o.o.) is one of the most frequently chosen legal forms for doing business in Poland, especially by foreign investors.
Its main advantages include not only a quick and simple incorporation process, but also a flexible operating model that responds to the dynamic needs of the global market. The growing interest in the limited liability company is due to its numerous advantages, such as limited liability, ease of raising capital and ability to adapt quickly to changing market conditions.
In a Poland limited liability company, the shareholders’ meeting plays a key role as the highest decision-making body. It is responsible for making important decisions regarding the company’s operations and strategy, or approving the financial statements. Motions must be submitted well in advance of the proposed date of the shareholders’ meeting.
Although it is not a governing body, its powers are fundamental to shaping the company’s direction and overseeing its operations. The shareholders’ assembly has significant influence on the most important decisions that determine the future and success of the company.
What regulation is governing limited liability companies in Poland?
The Commercial Companies Code (CCC) is the key legal act governing the operation of commercial companies in Poland, including limited liability companies.
The CCC contains provisions concerning, among other things, the formation of a company, the articles of association, share capital, company bodies, the rights and obligations of shareholders, dissolution of the company and liquidation. Thanks to the CCC, entrepreneurs can count on consistent and comprehensive regulations that support the development of their business.
General Meeting and Extraordinary General Shareholders’ Meeting in a limited liability company
The shareholders’ meeting in a limited liability company is the ownership body. It is within this body that the owners of a limited liability company (shareholders) make strategic decisions on the direction of the limited liability company and its operations.
Poland’s limited liability company has two types of shareholders’ meetings:
- General Shareholders’ Meeting,
- Extraordinary General Meeting of Shareholders.
General Shareholders’ Meeting should be held within 6 months after the end of each fiscal year. In practice, in most companies this deadline is June 30.
Extraordinary General Meetings of Shareholders are convened as needed during the fiscal year and consider matters brought to the agenda.
What are the powers of the shareholders’ assembly?
The shareholders’ assembly has influence over many areas of the limited liability company’s business, such as:
1. Approval of reports
The shareholders’ assembly is responsible for approving the annual financial statements and the management report on the company’s activities, which are presented by the board of directors. These reports contain key information about the company’s financial and operational situation.
2. Discharge of members of the company’s bodies
The shareholders’ assembly decides on the discharge of members of the board of directors and other company bodies. Discharge is a formal confirmation that the members of the bodies have performed their duties in accordance with the law and in the interests of the company.
3. Decisions to seek redress for damage caused in the formation of the limited liability company.
The shareholders’ meeting shall approve the limited liability company’s actions to pursue claims for damages caused in the establishment of the limited liability company or caused in the exercise of management or supervision.
4. Decisions related to the sale or lease of an enterprise
The enterprise of a limited liability company, as well as its organized part, may be sold, leased, and it is also possible to establish a limited right in rem thereon. To carry out any of these actions requires a resolution of the shareholders’ meeting.
5. Decisions related to trading in real estate
Unless otherwise provided in the articles of association, a resolution of the shareholders’ meeting is required for the acquisition and disposal of real estate, perpetual usufruct or an interest in real estate.
6. Amendment of the articles of association of a limited liability company
The shareholders’ meeting of a limited liability company in the form of a shareholders’ resolution shall decide on the shape of the content of the articles of association.
7. Dissolution and liquidation of the company
The shareholders’ assembly of a limited liability company decides on the continued existence of the company, its dissolution and liquidation.
The above catalog contains examples of the powers of the shareholders’ assembly. In addition, the shareholders may also indicate in the wording of the articles of association what other actions of the limited liability company require the approval of a shareholders’ resolution.
Who convenes shareholders’ meetings?
The shareholders’ meeting is convened by the management board of the limited liability company. The board of directors is required to convene an annual shareholders’ meeting within 6 months after the end of each fiscal year. In practice, for most companies this deadline is June 30 of each year.
The competence to convene a shareholders’ meeting is also vested in the audit committee or supervisory board in certain cases – if these bodies have been established in the limited liability company.
In addition, the regulations allow the limited liability company’s articles of association to designate other persons authorized to initiate a meeting, which provides greater freedom and flexibility in managing the company’s processes. Such a solution also allows the delegation of tasks, which improves the operation of the company and increases its efficiency.
The procedure for convening a shareholders’ meeting is transparent and is based on ensuring full communication between the company and its owners. Invitations are sent by registered mail or courier service at least two weeks before the scheduled date of the shareholders’ meeting.
It is also worth noting that in the age of modern technology it is possible to use electronic communication. It is enough that the shareholder gives written consent, and all notices can be sent to the e-mail address provided.
Even if the formal requirements for convening a shareholders’ meeting (both an ordinary and extraordinary general meeting) are not observed, this does not mean that the meeting cannot take place.
In the context of dynamic business and the need for quick decision-making – especially for foreign investors – Poland’s regulations provide for the possibility of passing resolutions without formally convening meetings.
The key condition is the presence of shareholders representing the entire share capital of the company and the absence of objections to holding the meeting. This solution significantly facilitates efficient management of the company.
Where do shareholder meetings take place?
A shareholders’ meeting in a Poland limited liability company should by default be held at the company’s registered office. However, there is the possibility of greater flexibility – in the company’s articles of association you can specify another place within Poland.
If the shareholders agree in writing, the meeting can also be held at another location in the country, which may be advantageous depending on the needs and specifics of the company’s business.
For foreign investors who value flexibility and modern management solutions, Poland Ltd. offers innovative mechanisms for efficient and effective decision-making, even at a distance. One of the key conveniences is the ability to participate in a shareholders’ meeting using electronic communications.
Such participation can involve two-way, fully interactive, real-time communication, allowing people to speak and make decisions, regardless of their physical presence at the meeting.
The supervisory board, and in its deficiency the shareholders, have the option of defining the rules for participation in meetings using electronic communication in the form of bylaws. It is important that the bylaws do not impose unnecessary restrictions, and focus on technical issues that are intended only to identify participants and secure the entire process.
However, it is important that the chairman of the shareholders’ meeting remain at the company’s headquarters or other place in Poland where the meeting is formally to be held during the meeting. The other shareholders can be anywhere during this time.
The advantages of this solution are invaluable in a dynamic international environment, where quick reaction and real-time decision-making can determine the success of an investment.
Quorum and voting rights at a shareholders’ meeting
At a shareholders’ meeting, all shareholders have the right to vote on resolutions, which is a key element of their control over the company. Moreover, only shareholders have this right, guaranteeing full transparency and influence over strategic decisions.
As a general rule, resolutions of the shareholders’ meeting are passed by a simple majority of votes, without the requirement of a quorum – unless otherwise stipulated in the limited liability company’s articles of association or the Commercial Code. There is one vote for each share of equal nominal value. If the shares have a different nominal value, the votes are distributed proportionally – one vote falls for each PLN 10 of the nominal value of the share. Voting takes place openly.
Secret voting is mandatory for the election of members of the company’s bodies, motions to dismiss members of the board of directors or liquidators, as well as in personal matters and those concerning the liability of members of the bodies. Secret voting may also be ordered at the request of one of the shareholders present.
It is worth noting that in a limited liability company, shareholders can use proxies to vote on their behalf, which significantly increases flexibility and facilitates the decision-making process.
Thus, a shareholder can grant a power of attorney to another person to represent him at the meeting and vote in accordance with his instructions. Importantly, the proxy requires only a written form, which makes the process simple and convenient, with no additional formalities required. It should be remembered that a member of the board of directors and an employee of the company cannot be proxies at a shareholders’ meeting.
With this solution, shareholders can ensure convenient access to meetings, regardless of their location, which is particularly beneficial for international investors operating in different time zones or locations. The ability to vote by proxy promotes management efficiency and ensures that decisions can be made efficiently and in full accordance with the will of the limited company’s shareholders.
Shareholders’ assembly in the articles of association
For foreign investors, understanding the role and function of the shareholders’ assembly in a Poland limited liability company is crucial for effective management and oversight of investments. Thanks to transparent procedures, flexibility in the organization of meetings and modern solutions, Poland’s limited liability company offers a stable and efficient environment for conducting business.
Familiarity with these aspects allows investors to better utilize the company’s potential, react quickly to market changes and make effective decisions, which is crucial for success in the dynamic world of investment.
FAQ – Meeting of shareholders in a limited liability company
When must the annual shareholder meeting be held in a Polish limited liability company, and who can attend?
The annual general meeting must be held within 6 months after the end of each previous year (typically by June 30). All shareholders can attend, and they can also appoint proxies to represent them at the meeting, though board members and company employees cannot serve as proxies.
What are the requirements for the meeting notice, and how can the company management communicate it to shareholders?
The company secretary or authorized board members must send meeting notices at least two weeks before the meeting date. Notices can be sent via registered mail, courier service, or – with shareholders’ written consent – to their email addresses through the company website.
Can shareholders pass resolutions without a formally called meeting?
Yes, corporations can pass resolutions without formal notice if all shareholders are present and none object. This flexibility in company bylaws allows foreign entities to make quick decisions, provided they represent the entire share capital.
What key issues do statutory auditors and board members address during the annual meetings?
During these meetings, they address:
- Approval of annual reports,
- Discharge of board members and their re-election,
- Company issues related to damage claims,
- Decisions about real estate transactions,
- Amendments to company bylaws.
What are the key requirements and procedures for calling a valid shareholder meeting under Polish law, and how can the business structure affect the agenda?
According to the article, the corporate secretary or management must formally convene shareholder meetings by sending notices to called members at least two weeks before the annual meeting or other shareholder meetings. The agenda must be submitted well in advance of the meeting date.
While the previous meeting’s minutes should be approved, the law allows flexibility in the business structure – shareholders can modify voting procedures through the articles of association. A person can represent shareholders through written proxy.
