The legislator imposes numerous registration obligations on economic operators. In particular, traders operating in the form of commercial companies are required to submit applications to the National Court Register, inter alia, for entries, changes to entries or their deletion or specific documentation.
These obligations most often concern the composition of the company's bodies, the ownership structure (shareholders or shareholders), or the submission of reporting documents, as is the case for financial statements.
If, on the other hand, the trader fails to fulfil his statutory obligations, the Registry Court shall have appropriate legal bodies to enforce the obligations of a non-sumitive entity. one from such institutions is the so-called compulsory procedure established under Article 24 Act dated 20 August 1997 on the National Court Register (i.e.
Journal of Laws of 2018, item 986, hereinafter referred to as the ‘KRS Act’).
Article 24(1) the act in question requires the Registry Court to initiate a coercive procedure where it is established that the application for entry in the Register or the documents for which submission is compulsory has not been lodged despite the expiry of the time limit.
On the other hand, according to the wording Article 24(2) The NRS Act may also initiate proceedings in justified cases where it is established that a legal person does not have a body entitled to represent or that there are deficiencies preventing its action.
Procedure for initiating a compulsory procedure
Initiation of a coercive procedure shall take place by means of a request from the Registry Court to the obliged persons. In the event of a request for entry or presentation of documents, the Registry Court shall, on the basis of Article 24(1) The KRS Act sets an additional seven-day time limit for these activities.
On the other hand, where the company does not have a body entitled to represent the company or in its composition there are shortcomings preventing it from acting, the Registry Court may make a call to the obliged persons (most often the partners of the company), at the same time setting an appropriate time limit for the appointment or selection of that body, to demonstrate that the body has been appointed or elected or that the deficiencies in its composition have been removed.
The call is intended to enable persons called upon to do their own due diligence by entering alerts or documents and to demonstrate that an authority has been appointed or elected or to remedy deficiencies in the composition of the body.
Penalties for failure to perform duties
Both In the first, and second in the case of coercive proceedings, the Registry Court shall make a request for the application of the fine provided for in the provisions. Act dated 17 November 1964 – Code of Civil Procedure on the enforcement of non-monetary benefits.
In the event that the obligations are not fulfilled within the additional time limit, the Registry Court shall impose a fine on the persons obliged by order. Such a fine may not exceed 15,000 PLN (fifteen one thousand gold) In one order and the Registry Court may renew it.
Importantly, if the Registry Court has already imposed two twice the fine and has proved to be ineffective – limitation to the amount 15,000 PLN does not apply, although the total amount of fines in the same case must not exceed one million Gold.
It is extremely important for obliged persons that if the obliged entity performs the activities for which it has been obliged by the Registry Court or will take place discontinuance of proceedings – fines not paid by then shall be remitted.
The Registry Court discontinued the proceedings Forced where it is apparent from the circumstances of the case that it will not lead to the fulfilment of the obligations set out in the notice.
Importantly, the Registry Court may at any time initiate a coercive procedure if it is informed that the legal or factual situation of the company has changed to one which enables the effective conduct of the coercive procedure.
In conclusion, it must be concluded that the coercive proceedings laid down by the legislator under Article 24 The KRS Act is a useful legal instrument for disciplining non-compliances made available to the Registry Courts.
The regulation aims to eliminate a phenomenon that is detrimental to the certainty of trading, which involves the functioning of the trading of entities that do not comply with the obligations of registration, registration or disenfranchising the body entitled to represent.
Additional time limits for calls, both 7-the day-to-day and duly outlined by the Registry Court, enabling the obliged entities to fulfil their duties themselves, should be assessed positively.
On the other hand, referring to the possible imposition of a fine by the Registry Court, it should be pointed out that it is primarily a measure aimed at mobilising obliged entities.
Such a request is justified by the fact that, in the event of the performance of the action by the debtor, the fines not paid by the debtor until then have been remitted by the construction of a legal mechanism to free themselves from the negative financial consequences of the entities which will satisfy the contents of the application for a registration court.
Author:
Michał Skwarek – a solicitor in the Legal Department. Graduate of the Faculty of Law and Administration of the University of Warsaw