One-man economic activity in Poland is a basic form of conducting business. Often these single-person entities are powerful individuals, generating large incomes and employing many employees. The death of an entrepreneur running such a company has caused many problems until recently and has generated a risk of slowing down the development of a prosperous company.
On 25 November 2018 entered into force Act dated 5 July 2018 about the management of a successful company of a natural person. This law applies to entrepreneurs who at the time of their death were registered in the Central Register and Information on Economic Activity. It allows for the continuation of economic activity, carried out before the death of the entrepreneur in the form of one-man activity, as well as within a civil partnership. The Act constitutes an important novum of the Polish legal system.
The primary objective of the law was to ensure that entrepreneurs who are natural persons are in a position to maintain the continuity of the business after their death, taking into account that the company should be regarded as a legal asset, having not only economic and financial value, but also social value.
The primary purpose of the law was to ensure that entrepreneurs who are natural persons are in a position to maintain the continuity of the operation of the company after their death, taking into account that the company should be regarded as a legal asset, having not only economic and economic value, but also social value.
The Act introduced into the legal system a new board of directors and succession administrator, entitled to manage a separate part of the property, which is an enterprise, on its own behalf, but on the account of the successors of the entrepreneur and with effect for their assets.
Under this law, the succession administrator may be appointed in the lifetime of the entrepreneur, which requires the maintenance of a written form under the rigor of invalidity (by indicating a particular person to serve as a succession administrator or by stating that, at the time of his death, the appointed proxy will become a succession administrator), or after his death.
According to Article 12 After the death of the entrepreneur, the succession administrator may be appointed by the spouse of the entrepreneur who is entitled to a share in the company in the inheritance, as well as by the statutory heir of the entrepreneur who accepted the inheritance, or by the will heir of the entrepreneur who accepted the inheritance, or by the debt collector who accepted the debt note if, in accordance with the announced will, he is entitled to a share in the company in the inheritance.
In the second the option (after the death of the entrepreneur) to appoint a succession administrator requires maintaining the form of notarial act. It should also be remembered that, under the law, the power to appoint a succession administrator expires with the expiry of two months after the death of the entrepreneur.
In the event of the appointment of a succession manager, he shall be obliged to conduct the business in succession and entitled to perform legal (judicial and out-of-court) activities related to the conduct of the business in succession.
The succession administrator is entitled to perform all activities of the ordinary board, while in the field of activities exceeding the scope of the ordinary board, he is obliged to obtain the consent of all owners of the company in succession and in the absence of such permission, the permission of the court.
It is also the responsibility of the administrator to regulate all public and private liabilities (including liabilities to employees of the company) on a regular basis. The company operates under the current company of the entrepreneur with the addition of the designation "in decline".
Importantly, the succession board cannot be transferred, but the succession board may appoint a proxy. The Act also states that the succession board cannot be reduced with effect on individuals third. According to Article 11 the Act under discussion as a succession manager In one time can only be fulfilled one person.
For the performance of his duties, the succession administrator is entitled to remuneration, and in this respect, the provisions of the Civil Code on Order shall apply accordingly. On the other hand, the owners of the company in decline have the right to participate in the profits and participate in the losses resulting from the company’s conduct in the inheritance, in the ratio in which they have a share in the company in the inheritance.
The Act also provides for a chapter 7 the possibility of succession of decisions given to the deceased entrepreneur (concessions, permits, licences and licences, issued to the entrepreneur in the form of decisions of the public administration authority), related to the company, which often form the basis for continuing business activity.
In conclusion, the Act introduced allows for the smooth operation of the company. It reduces the risk of loss of profits of the company, keeps existing jobs, facilitates the regulation of the company's liabilities towards counterparties and public-law liabilities. The law facilitates a smooth transition through an uneasy period of time associated with the death of someone who ran the company, and this company receives a chance for further development.
Author: Michał Wasilenko
Lawyer, Associate in the Legal Department, member of the Bar Association in Lublin, graduate of the Faculty of Law and Administration at Maria Curie-Skłodowska University in Lublin. He specializes in commercial and civil law law.