Now. 13 October 2022 the amendment of the Commercial Companies Code enters into force. Amendments will be made by the Act of 9 February 2022 amending the Act – Code of Commercial Companies and some other laws, which assumes a number of significant changes in commercial law. one of the most important changes to KSH regulations is the introduction of the law of groups of companies into the Polish legal order.
These provisions introduce a definition of a group of companies and a division that will regulate the functioning of those groups.
The rights of groups of companies will apply only to the parent company and the subsidiary, which have adopted a resolution on participation in a group of companies, and (as appropriate) to a company affiliated with the parent company, if its contract or statutes so provide.
The primary objective of group law is the statutory normalisation of the relationship between the holding companies.
Participation in a group of companies will be voluntary, but it will be necessary to disclose in the National Court Register the fact of participation in a group, and the application of the law of groups of companies is only possible after disclosure of the relevant reference.
The law of groups of companies introduces the possibility for the parent company to issue a binding order for the conduct of the company's affairs and regulates the manner in which it is implemented and the possibility that the subsidiary may refuse to execute it.
The revised KSH regulations also provide for:
- the right of the parent company to review at any time the books and documents of the subsidiary and to request that it provide information,
- the obligation of the supervisory board of the parent company to supervise the performance of the interest of the group of companies by the subsidiary; this obligation may be excluded in the contract or statutes,
- the obligation for the management of the subsidiary to report annually on contractual links with the parent company and the binding instructions it has given,
- entitlement of shareholders or minority shareholders representing at least 10% share capital to request a special audit to examine the accounts and activities of the group of companies,
entitlement of shareholders or minority shareholders representing less than 10% share capital to require the compulsory repurchase of their shares or shares by a parent company which represents at least directly or indirectly 90% the share capital of the subsidiary,
the power of the parent company representing at least 90% the share capital of the subsidiary to adopt a resolution on the compulsory redemption of shareholders or minority shareholders of the subsidiary,
the possibility to hold the parent company liable for damages (in certain cases) to the subsidiary, shareholders or minority shareholders of the subsidiary and creditors of the subsidiary for damages caused by the performance of a binding order.
In addition, the amendment provides for the exemption of members of the board, supervisory board, audit commission and liquidators of the subsidiary and parent company from liability for the damage caused by the performance of a binding order if they acted in the interests of a group of companies.
Author: Magdalena Mączka Legal Advisor, Russell Bedford Dmowski and Associates Law Firm Sp. k.