By virtue of the Regulation of the Minister of Health dated March 21, 2020 on Declaring the State of Epidemic within the Republic of Poland following COVID-19 infections, a number of restrictions have been enacted which have a bearing on the functioning of certain companies. The raging epidemic and the associated interaction and mobility restrictions have significantly hampered company functioning and decision making. We present the mechanisms enabling companies to function with as little interruption as possible, given the extraordinary circumstances.

Convening Shareholder Meetings and Adopting Resolutions

A private limited liability company (LLC) is among the most common forms of conducting business operations. One of the basic statutory requirements imposed on such companies is the necessity to convene an extraordinary shareholders meeting at the company’s registered office or at a different location within the Republic of Poland, specified in the articles of association, within six months following the end of a given trading year.

The spreading epidemic and the mobility controls enacted by multiple countries have caused ample difficulties and restrictions for such companies whose shareholders, or at least one shareholder, permanently reside abroad and are unable to travel to Poland. That being the case, one solution is for a shareholder to grant a power of attorney to participate and vote on its behalf at the shareholder meeting.

As we have already written on the subject, as of September 3, 2019 the articles of association may allow for participating in the shareholders meeting using means of remote electronic communication, particularly:

• Live, real-time streaming of the shareholders meeting session

• Two-way, real-time communication whereby the shareholders may take the floor during the shareholders meeting session, while being physically at a different location than that where the shareholders meeting session is being held

• Exercising, personally or via an attorney in fact, the right to vote prior to or in the course of the shareholders meeting

The articles of association must clearly provide for the possibility to conduct the shareholders meeting using means of remote communication and detail the applications or software which may be used. The application of the above mentioned procedure does not relieve the company of its obligation to draft the minutes of the shareholders meetings.

Further, it is very often necessary to convene an emergency extraordinary shareholders meeting, e.g. in order to adopt resolutions concerning changes of corporate officers, share capital or corporate operations. That being the case, the Commercial Companies and Partnerships Code provides for adopting circular resolutions. As per the provisions, the shareholders may adopt resolutions without holding the meeting, if all the shareholders have consented in writing or have consented to the issue to be resolved. The circular resolution may then be adopted, either on one document or by each of the shareholders making a statement constituting a separate document. What is noteworthy, however, is that not all resolutions may be adopted in such fashion. The above mentioned procedure does not apply to resolutions adopted by the ordinary shareholders meeting and resolutions as to which the law or the articles of association require holding the shareholders meeting.

Management and Supervisory Board Functioning

If a supervisory board had been appointed at the private limited liability company, its members shall, in principle, adopt resolutions during meetings. The articles of association may, however, allow for a possibility to adopt circular resolutions or to do so using means of remote direct communication. It is noteworthy that the resolution adopted by the supervisory board in the above mentioned fashion is only valid if the articles of association have clearly provided for such measures and all supervisory board members have been notified of the draft resolution wording.

Further, pursuant to the laws currently in effect, supervisory board members may participate in adopting resolutions by casting a circular vote via a different supervisory board member. Casting a circular vote may not, however, concern matters entered into the agenda in the course of the supervisory board meeting.

Unlike in the case of the supervisory board, the Commercial Companies and Partnerships Code does not specify issues pertaining to adopting circular or remote resolutions by the management board members. The doctrine and the body of rulings in that regard are rather controversial. While some advocate that such manner be inadmissible with regard to the company management board, a vast majority of the doctrine, despite the absence of clear regulations to that effect, have allowed the possibility of circular or remote resolutions to be adopted by the management board only if the articles of association or the management board bylaws have so provided. Therefore, it may be assumed that, in the case of appropriate regulations within the articles of association, the management board may be authorized to adopt circular or remote resolutions.

The draft amendment to the Act on the Particular Solutions with regard to Preventing, Counteracting and Fighting COVID-19, other Contagious Diseases and the Related Crises and Certain Other Acts (referred to as the special COVID-19 Act) provides for a solution which is meant to help and facilitate the functioning of corporate officers. As per the assumptions, the new regulations are to allow for the possibility to participate in the management or supervisory board meetings using means of remote direct communication, unless otherwise provided for in the articles of association. The assumption of the amendment is that adopting circular or remote resolutions is supposed to become the rule, which may only be waived by way of an appropriate provision to that effect within the articles of association. With regard to the above, companies will not be compelled to include appropriate provisions within the articles of association in order to vote on circular or remote resolutions. The draft amendment is still being debated and it may undergo certain changes.

Financial Statements

As per the laws currently in effect, private limited liability companies are obliged to prepare their financial statements within three months following the end of the balance year and then to convene the shareholders meeting in order to approve of such financial statements within a further three months. For companies whose trading year coincides with the calendar year, the deadline for preparing the financial statements lapses on March 31, 2020 and for approving the financial statements by the shareholders meeting on June 30, 2020.

Given the current situation brought about by the epidemic, on March 16, 2020, the Polish Auditors Chamber issued a list of rules pertaining to auditing financial statements for 2019. The presented guidelines refer to, among others, safe cooperation with clients, information regarding preparing the audit report in the context of post-balance-sheet-date events, as well as assessing the audited entity’s going concern capabilities. The possibility of deferring the deadline for approving of the financial statements is also being debated.

Registering Beneficial Owners With the Central Beneficial Owners Register

Pursuant to the Act of March 1, 2018 on Counteracting Money Laundering and Financing Terrorism, private limited liability companies are obliged to indicate their beneficial owners and report information regarding same to the Central Beneficial Owners Register (the Register). According to the regulations, for companies registered with the National Court Register prior to October 13, 2019, the first beneficial owner report must be effected by April 13, 2020 at the latest, while for newly incorporated companies, registered after October 13, 2019, such information must be reported to the Register within seven days following National Court Register entry. Given the current situation related to the epidemic and the difficulties which they encounter with regard to their operations, as part of the packaged referred to as the Anti-Crisis Shield, the Ministry of Finance has announced the possibility of deferring the reporting requirement related to beneficial owner registration and setting it at July 13, 2020.

Register Court Disclosure

Due to the deferred effective date of the provisions enacting electronic registration procedures before the National Court Register, the obligation to file registration applications with the court electronically will enter into force as late as March 1, 2021. The current application procedure will remain as is. Applications to register a private limited liability company or applications for amending entries pertaining to already registered companies may be filed via the s24 electronic system. Financial statements and other documents
required to make appropriate register entries may also be effected electronically.

However, when filing hard copies of applications, one must ensure and confirm the appropriate filing procedure with the registration court with which the application is to be filed, i.e. whether applications may be filed with the registry office or solely by mail.