In December 2021, a government IT system for handling restructuring and insolvency cases was introduced in Poland. As a rule, the court, receivers, debtors and creditors are obliged to participate in the proceedings using this system. Paper documents are to disappear. Thus, paper filings or votes will not be honoured.
Our law firm helps foreign creditors to participate in restructuring and insolvency proceedings via the IT portal so that their claims and votes are properly valid.
Pursuant to the resolution of the Supreme Court of 12 January 2022, file ref. III CZP 67/22, conclusion by a joint-stock company of a surety agreement for a debt of a spouse who remains in statutory community with a management board member of that company requires consent of the general meeting (art. 15 § 1 of the Commercial Companies Code).
In Poland, because of Covid-19, a special simplified restructuring procedure was implemented. According to the law, until 30 June 2021, an insolvent or at risk of insolvency debtor who has concluded an agreement with a restructuring advisor to supervise the course of proceedings for the approval of an arrangement may announce in the special journal Monitor Sądowy i Gospodarczy the opening of proceedings for the approval of an arrangement conducted on the basis of the provisions of the Act of 15 May 2015. - Restructuring Law.
The announcement may be made after the debtor has prepared
- arrangement proposals and
- list of claims,
- list of disputed claims
and handing them over to the arrangement supervisor.
The date of making the announcement shall be the date on which the proceedings for approval of the arrangement are opened.
As of the date of making the announcement until the date of discontinuance or termination of the proceedings for approval of the arrangement, inter alia:
1)the enforcement proceedings concerning claims specified by law initiated before the date of the opening of the proceedings shall be suspended by way of law;
2)the commencement of enforcement proceedings and the enforcement of a decision to secure a claim or an order to secure a claim arising from claims specified by law shall be prohibited.
Claims specified by law under the rules indicated therein are included in the arrangement even without the creditor's consent.
At the request of the creditor, the debtor or the supervisor of the arrangement, the court shall waive the effects of making the announcement specified by law if they lead to the harm of the creditors.
Independently of the collection of votes, according to the procedure specified by the Act - Restructuring Law, the supervisor of the arrangement may appoint a date for a creditors' meeting to vote on the arrangement. The creditors' meeting is chaired by the supervisor of the arrangement.
If there are technical possibilities, voting at the creditors' meeting may be conducted using electronic means of communication.
The proceedings to approve the arrangement shall be discontinued by force of law if no application for approval of the arrangement is submitted to the court within four months of the date of the announcement.
At the request of the debtor, creditor or any other person having a legal interest therein, the court shall issue a decision stating that the proceedings are discontinued by force of law.
From the date of making the announcement until the date of discontinuance or termination of proceedings for approval of the arrangement, the debtor may perform ordinary management activities. The consent of the supervisor of the composition agreement is required for any activities that exceed the scope of ordinary management. Consent may also be given after the activity has been performed, within thirty days from the date of its performance. An act exceeding the scope of ordinary management made without the required consent is invalid.
Another advantage of this procedure is that, under certain conditions, as a result of the timely announcement of the opening of proceedings for the approval of the arrangement, the liability of certain persons on the grounds specified in the act is excluded.
Ewa Kosowska-Czapla
Attorney-at-law
That happend for foreign clients that they receive documents from polish court for example in Germany, Sweden or another country UE.
They do not know how to behave in this situation. This case is stated in regulation (EC) No 1393/2007 of the European Parliament and of the Council of 13 November 2007 on the service in the Member States of judicial and extrajudicial documents in civil or commercial matters (service of documents), and repealing Council Regulation (EC) No 1348/2000.
In article 14 of this regulation we read „Each Member State shall be free to effect service of judicial documents directly by postal services on persons residing in another Member State by registered letter with acknowledgement of receipt or equivalent.” It means that letter from polish court is legal if it was done by postal services by registered letter with acknowledgement of receipt or equivalent. Among documents from polish court could be: claim, judgement, calling for the hearing etc.
That is why you should not ignore that letter, ever if it is in polish.
The addressee can act in two ways in this case:
- he may refuse to accept the document to be served at the time of service,
- he may returning the document to the court within one week
if it is not written in, or accompanied by a translation into, either of the following languages:
- a language which the addressee understands or
- the official language of the Member State addressed or, if there are several official languages in that Member State, the official language or one of the official languages of the place where service is to be effected.
Before the addressee decide to refuse or return the document he or she should consider if there are circumstanced which can be based to assume that he or she understand polish language. For example he or she used documents during doing business in this language, If from these circumstances the court can assume that he or she knows polish languages – this return or refusal can be treat as illegal.
Additionaly not all documentation should be translated. If we have a claim and enclosed documents – these appendix may be not translated.
After receiving documents the addressee should start action to protect his or her rights before polish court.
Ewa Kosowska-Czapla
Attorney-at-law / Restructuring Advisor
In our practice we often encounter a situation when foreign entrepreneurs conduct business activity in Poland in the form of a limited liability company.
Due to the barriers on the Polish market, in particular the language barrier, as well as numerous duties related to the activity in the home country, entrepreneurs are looking for a "manager" for their activity.
Foreign entrepreneurs want to be a member of the management board of the created Companies, in order to ensure that they are able to influence their business on an ongoing basis. Then they often appoint a proxy, who becomes the "manager" of the Company.
At the same time, a distinction should be made between the sphere of activity of a proxy as a representative of the Company, i.e. "outside", and the internal sphere, i.e. relations between the Company and the proxy.
As far as the proxy's activity as a representative of the Company is concerned, I would like to point out the following.
In principle, by virtue of the power of proxy granted, the commercial proxy may represent the Company before all entities, e.g. contractors, offices, employees in activities related to running the enterprise. Therefore, it is worth bearing in mind that all agreements concluded by a commercial proxy in the performance of business activity will be binding for the Company, regardless of whether - in the opinion of a foreign contractor - they are beneficial for the Company or not. Therefore, the Company will have to meet the obligations assumed by the commercial proxy.
In accordance with the provisions of law, the proxy must hold a special power of attorney to perform such activities as:
As far as, for example, the proxy of a limited liability company is concerned, in some situations a resolution of the shareholders will also be necessary for its important and effective operation.
According to the provision of Article 228 of the Polish Commercial Companies Code (k.s.h.), a resolution of shareholders is required, among other things:
On the other hand, the provision of art. 15 § 1 of the Polish Commercial Companies Code indicates that the conclusion by a capital company of a credit, loan, surety or other similar agreement with a proxy or on his behalf requires the consent of the general meeting of shareholders, unless the Act provides otherwise.
The proxy may also be organized in such a way as to make it impossible for the proxy to act independently by establishing a joint proxy, but only with another proxy (Article 1094 § 1 of the Civil Code). The proxy can be set also since 2016 to perform activities jointly with a member of the management board or a partner authorized to represent the partnership.
Information on whether the proxy may act jointly or independently is available in the register of entrepreneurs (provision of Article 1098 § 2 of the Civil Code).
If the company has a branch, the power of attorney may be limited to matters entered in the register of the branch.
As far as the relations between the proxy and the Company are concerned, I would like to point out the following.
At the same time, the Company should have an agreement with the proxy, in which the rules of cooperation (employment contract, managerial contract, contract of mandate) will be regulated. Some entrepreneurs stipulate in these agreements that the proxy may not conclude transactions exceeding a certain value. It is worth pointing out, however, that such reservations are not effective against three persons, but only in the internal relationship between the Company and the proxy. According to the provision of art. 1091 § 2 of the Civil Code, a commercial proxy may not be limited with effect in relation to third parties, unless a specific provision provides otherwise. Thus, only the provisions of law may decide that the proxy will not have the right of unrestricted representation.
The Proxy shall not be liable towards third parties for the Company's obligations. The Company is responsible for its obligations. In certain cases, members of the Management Board are liable. The fact that a proxy has been appointed does not release the Management Board from its duties related to the Company's operations. Therefore, the Management Board should supervise the proxy on an ongoing basis. In particular, the Management Board should take care that the proxy's actions are compliant with the law and are undertaken in the interest of the Company. The Management Board should monitor the financial situation of the Company on an ongoing basis.
If the proxy acts to the detriment of the Company, it may be necessary to immediately dismiss the proxy, terminate the agreement between the parties and pursue claims for damages against the proxy before the Court.
Ewa Kosowska-Czapla
Attorney-at-law
A wine producer within the meaning of the Polish Wine Act is:
In order to be recognised as a wine producer, not only should the wine be made or bottled but also marketed. Therefore, if we make wine for our own needs, we will not be recognized as a producer. Similarly, if we do not have our own crops. (Article 2(1)(21) of the Polish Wine Act).
Issue not legally clarified due to incoherence of concepts. An exemplary attempt to solve the problem was presented.
The regulations of the Polish Law of Entrepreneurs, and thus the necessity of entry in the CEiDG do not apply to:
They may be entered:
https://prod.ceidg.gov.pl/ceidg.cms.engine/?F;1b22de7d-916d-4591-b44d-3b8e2be61121
A farmer as defined in Article 2(a) of Council Regulation (EC) No 73/2009
"agricultural activity” means, inter alia, the production of agricultural products,
"agricultural products” means the products, with the exception of fishery products, listed in Annex I to the Treaties, as well as cotton.
The Treaty mentions:
Grape must, fermenting or with fermentation stopped otherwise than by the addition of alcohol; Wine of fresh grapes; grape must with fermentation stopped by the addition of alcohol; Other fermented beverages (e.g. cider, perry and mead).
Entry of the farmer in the register of agricultural producers
An entry in the register of producers shall be made, by way of an administrative decision, at the request of the head of the district office of the Agency for Restructuring and Modernisation of Agriculture with territorial jurisdiction, on a form drawn up and made available by the Agency.
https://www.arimr.gov.pl/dla-beneficjenta/wszystkie-wnioski/ewidencja-producentow.html
Entry in the ministerial register of 'winemakers' - regulated activities
Article 17(1) Economic activity within the scope of production or bottling of wine products is a regulated activity within the meaning of the provisions of the Act of 6 March 2018. - The Law of Entrepreneurs (Journal of Laws, item 646) and requires an entry in the Register of Entrepreneurs performing activities related to the production or bottling of wine products, hereinafter referred to as "the Register".
(2)The business activity in the field of wine products may also include bottling of wine products.
(3) The requirements for registration shall not apply to producers who exclusively make and bottle wine obtained from grapes grown in their own right.
Ministerial register
The legal basis for keeping the register is Article 20 of the Act of 12 May 2011 on the manufacture and bottling of wine products, trade in such products and organisation of the wine market (Journal of Laws of 2016, item 859, as amended), hereinafter referred to as the "Act".
Each producer and entrepreneur making wine from grapes obtained from vines located on the territory of the Republic of Poland to be marketed should be entered in the register kept by the Polish Director General of the KOWR (National Agricultural Support Centre) and submit certain documents.
http://www.kowr.gov.pl/interwencja/wino/pytania-dotyczace-rynku-wina
http://bip.stat.gov.pl/dzialalnosc-statystyki-publicznej/rejestr-regon/formularze-regon-papierowe/
https://www.biznes.gov.pl/pl/firma/sprawy-urzedowe/chce-dostac-pozwolenie-na-sprzedaz-alkoholu/proc_280 - permit for sale of alcohol
https://www.biznes.gov.pl/pl/firma/zezwolenia-koncesje-wpisy-do-rejestru/chce-uzyskac-zezwolenie-koncesje-wpis-do-rejestru-dzialalnosci-regulowanej54/proc_214-Wholesale/License for Wholesale Alcohols
https://ijhars.gov.pl/certyfikacja-wina.html3.
https://www.biznes.gov.pl/pl/firma/sprzedaz-i-marketing/chce-wprowadzic-produkt-usluge-na-rynek/proc_520-entry-enterprise-do-register-sanepid
https://www.biznes.gov.pl/pl/firma/sprzedaz-i-marketing/chce-wprowadzic-produkt-usluge-na-rynek/proc_521- approval-plant-i-entry-do-register-sanepid register
I invite you to get acquainted with the above material in the form of a film: https://www.youtube.com/watch?v=Vljogovulo
Ewa Kosowska- Czapla
Attorney-at-law/ Restructuring adviser
The concept of insolvency in Polish law has significant legal consequences. Insolvency is closely related to the necessity of filing a petition for bankruptcy by the obliged and determines the declaration of bankruptcy by the court. There are also serious consequences for certain entities related to the lack of timely filing of a bankruptcy petition.
Thus, each entrepreneur should monitor the condition of his company on an ongoing basis in order to respond to the state of insolvency in a timely and appropriate manner. Recently, as a result of the amendment to the bankruptcy and reorganisation law, which entered into force on 1 January 2016, the provisions on insolvency have changed quite significantly.
Bankruptcy is declared against a debtor who has become insolvent (Article 10 of the Polish Insolvency Law). Therefore the state of insolvency is a state which obliges the entrepreneur to file for bankruptcy. Pursuant to Article 21(1) of the Polish Insolvency Law, the debtor is obliged, not later than within thirty days from the date on which the basis for declaring bankruptcy occurred, to file a motion for declaring bankruptcy to the court.
Pursuant to Article 11(1) of the Polish Insolvency Law, a debtor is insolvent if he has lost the ability to fulfil his chargeable pecuniary obligations. A presumption has been introduced according to which the debtor is presumed to have lost the capacity to perform his chargeable pecuniary obligations if the delay in the performance of the pecuniary obligations exceeds three months.
Pursuant to Article 11(2), a debtor who is a legal person or an organisational unit without legal personality, to which a separate act grants legal capacity, shall also be insolvent if its pecuniary obligations exceed the value of its assets and this state of affairs persists for a period exceeding twenty-four months.
The first criteria that apply to all debtors is the loss of the debtor's ability to fulfil its chargeable pecuniary obligations.
It is worth noting that insolvency relates only to pecuniary obligations. Therefore, as Piotr Zimmerman points out in his commentary, "A debtor who fails to perform obligations of a non-pecuniary nature on time is not insolvent until such obligations become pecuniary by contract or action of the creditor, even if he is in delay in performing them for more than 3 months". (Prawo upadłościowe. Komentarz. Piotr Zimmerman. Wydawnictwo C.H. Beck, Warszawa 2016, komentarz do przepisu art. 11, system informacji prawnej Legalis).
Monetary liabilities must be chargeable. As pointed out by the Supreme Court in the judgment of 22 March 2001, V CKN 769/00 "In doctrine and judicature, the chargeability of a debt is defined as the state in which the creditor has the legal possibility to demand satisfaction of his debt to which the creditor is entitled. This is a potential, objective state, whose beginning coincides with the activation of the debt ( see the justification of the Supreme Court's judgment of 12 February 1991, III CRN 500/90, OSNCP 1992, no. 7-8, item 137). The beginning of due date cannot be summarised as a single rule applicable to all legal relations, as it depends on the nature of the obligations and their properties. Only chargeability in relation to obligations of a timely nature is uniformly recorded. It is then assumed that the claim is due if the deadline for performance has come, as from that date the creditor may demand fulfilment of the performance that the debtor has to fulfil. The issue of maturities in respect of indefinite obligations is different (...). In this case, it is not acceptable to adopt a position identifying the due dates and performance, since Article 455 of Kodeks Postępowania Cywilnego (the Polish Civil Code), which defines the date of performance as "immediate" after being called by the creditor". According to the above, monetary obligations become chargeable on the date set as the payment date, provided that this date has been set correctly. On the other hand, indefinite pecuniary obligations become chargeable immediately after the creditor has been called upon to fulfil them. For example, when the debtor is unable, despite being due, to meet its obligations, it should consider filing a petition for bankruptcy. Entrepreneurs or members of the Management Board of the Company should be aware of the current financial condition of the Company, and thus the possibility of satisfying the debts.
A practical problem in determining the loss of ability to fulfil chargeable obligations is whether there must be more than one creditor unsatisfied. The literature assumes that there must be at least two creditors. Polish Insolvency law is intended to establish joint enforcement by creditors (Article 1(1) of the Polish Insolvency Law) and therefore does not address the situation where there is only one creditor.
As regards the nature of the obligations, that is, whether or not they are linked to the business, the reasons why the obligations are not fulfilled, or whether the obligations are of a public or private nature, it must be concluded that all these factors remain irrelevant for the possibility of establishing insolvency.
As indicated above, in order to facilitate the creditor's situation, a presumption has been introduced according to which a debtor is presumed to have lost the capacity to fulfil his pecuniary obligations if the delay in the performance of the pecuniary obligations exceeds three months. However, this presumption is a rebuttable presumption. The debtor can therefore prove that he has not lost the capacity to fulfil the pecuniary obligations that have fallen due and that the non-fulfilment of the obligations is of a temporary nature.
2. The predominance of liabilities over assets (over-indebtedness)
For legal persons ( for example limited liability companies, joint-stock companies) or organizational units without legal personality, to which a separate act grants legal capacity, there is an additional, independent prerequisite for declaring bankruptcy. As mentioned above, pursuant to Article 11(2), a debtor who is a legal person or an organisational unit without legal personality, whose legal capacity is granted by a separate act, shall be deemed insolvent even if its financial obligations exceed the value of its assets and this condition persists for a period exceeding twenty-four months. However, this premise does not apply to partnerships specified in the Commercial Companies Code in which at least one partner responsible for the company's obligations without limitation is a natural person ( for example, a limited partnership in which a natural person is a general partner).
Thus, an obligated entity must not only monitor the issue of timely payment of chargeable obligations, but also monitor the relationship between the liabilities and the value of assets.
The law establishes the principles helpful in determining whether monetary liabilities exceed the value of assets.
First of all, the assets do not include components that are not part of the bankruptcy mass. As Piotr Zimmerman points out in his commentary, this applies in particular to components as obviously excluded from the mass as leased, rented or leasehold objects, but also to objects owned by other entities on the basis of, for example, the reservation of ownership rights to the seller until the full price has been paid (Prawo upadłościowe. Komentarz. Piotr Zimmerman. Wydawnictwo C.H. Beck, Warszawa 2016, komentarz do przepisu art. 11, system informacji prawnej Legalis).
Secondly, pecuniary obligations do not include future obligations, including obligations under a suspensive condition and obligations towards a partner or shareholder under a loan or other legal transaction with similar effects, as referred to in Article 342(1)(4). These obligations are treated as uncertain obligations.
Thirdly, also on the occasion of this condition, the legislator provided for a legal presumption facilitating the creditor's situation. A debtor's pecuniary obligations shall be presumed to exceed the value of his assets if, according to the balance sheet, his liabilities, excluding provisions for liabilities and liabilities to affiliated entities, exceed the value of his assets, and this condition persists for a period exceeding twenty-four months. Creditors will therefore be able, on the basis of an analysis of the balance sheet, to assess the situation as to whether there is a presumption of over-indebtedness in a particular case. However, as it follows from the above, provisions for liabilities and liabilities towards related parties will not be taken into account in the assessment of the balance of liabilities. Therefore, the legal science indicates that disputed receivables will not be taken into account, as they are included in the balance sheet as "provisions for liabilities". However, this presumption is a rebuttable presumption. A debtor may therefore point out that, taking into account whether monetary obligations exceed the value of assets, his off-balance sheet assets, for example, estimated on the basis of market prices, should also be taken into account.
Ewa Kosowska-Czapla
Polish Attorney-at-law, Licensed Receiver
In December 2021, a government IT system for handling restructuring and insolvency cases was introduced in Poland. As a rule, the court, receivers, debtors and creditors are obliged to participate in the proceedings using this system. Paper documents are to disappear. Thus, paper filings or votes will not be honoured.
Our law firm helps foreign creditors to participate in restructuring and insolvency proceedings via the IT portal so that their claims and votes are properly valid.
Pursuant to the resolution of the Supreme Court of 12 January 2022, file ref. III CZP 67/22, conclusion by a joint-stock company of a surety agreement for a debt of a spouse who remains in statutory community with a management board member of that company requires consent of the general meeting (art. 15 § 1 of the Commercial Companies Code).
In Poland, because of Covid-19, a special simplified restructuring procedure was implemented. According to the law, until 30 June 2021, an insolvent or at risk of insolvency debtor who has concluded an agreement with a restructuring advisor to supervise the course of proceedings for the approval of an arrangement may announce in the special journal Monitor Sądowy i Gospodarczy the opening of proceedings for the approval of an arrangement conducted on the basis of the provisions of the Act of 15 May 2015. - Restructuring Law.
The announcement may be made after the debtor has prepared
- arrangement proposals and
- list of claims,
- list of disputed claims
and handing them over to the arrangement supervisor.
The date of making the announcement shall be the date on which the proceedings for approval of the arrangement are opened.
As of the date of making the announcement until the date of discontinuance or termination of the proceedings for approval of the arrangement, inter alia:
1)the enforcement proceedings concerning claims specified by law initiated before the date of the opening of the proceedings shall be suspended by way of law;
2)the commencement of enforcement proceedings and the enforcement of a decision to secure a claim or an order to secure a claim arising from claims specified by law shall be prohibited.
Claims specified by law under the rules indicated therein are included in the arrangement even without the creditor's consent.
At the request of the creditor, the debtor or the supervisor of the arrangement, the court shall waive the effects of making the announcement specified by law if they lead to the harm of the creditors.
Independently of the collection of votes, according to the procedure specified by the Act - Restructuring Law, the supervisor of the arrangement may appoint a date for a creditors' meeting to vote on the arrangement. The creditors' meeting is chaired by the supervisor of the arrangement.
If there are technical possibilities, voting at the creditors' meeting may be conducted using electronic means of communication.
The proceedings to approve the arrangement shall be discontinued by force of law if no application for approval of the arrangement is submitted to the court within four months of the date of the announcement.
At the request of the debtor, creditor or any other person having a legal interest therein, the court shall issue a decision stating that the proceedings are discontinued by force of law.
From the date of making the announcement until the date of discontinuance or termination of proceedings for approval of the arrangement, the debtor may perform ordinary management activities. The consent of the supervisor of the composition agreement is required for any activities that exceed the scope of ordinary management. Consent may also be given after the activity has been performed, within thirty days from the date of its performance. An act exceeding the scope of ordinary management made without the required consent is invalid.
Another advantage of this procedure is that, under certain conditions, as a result of the timely announcement of the opening of proceedings for the approval of the arrangement, the liability of certain persons on the grounds specified in the act is excluded.
Ewa Kosowska-Czapla
Attorney-at-law
That happend for foreign clients that they receive documents from polish court for example in Germany, Sweden or another country UE.
They do not know how to behave in this situation. This case is stated in regulation (EC) No 1393/2007 of the European Parliament and of the Council of 13 November 2007 on the service in the Member States of judicial and extrajudicial documents in civil or commercial matters (service of documents), and repealing Council Regulation (EC) No 1348/2000.
In article 14 of this regulation we read „Each Member State shall be free to effect service of judicial documents directly by postal services on persons residing in another Member State by registered letter with acknowledgement of receipt or equivalent.” It means that letter from polish court is legal if it was done by postal services by registered letter with acknowledgement of receipt or equivalent. Among documents from polish court could be: claim, judgement, calling for the hearing etc.
That is why you should not ignore that letter, ever if it is in polish.
The addressee can act in two ways in this case:
- he may refuse to accept the document to be served at the time of service,
- he may returning the document to the court within one week
if it is not written in, or accompanied by a translation into, either of the following languages:
- a language which the addressee understands or
- the official language of the Member State addressed or, if there are several official languages in that Member State, the official language or one of the official languages of the place where service is to be effected.
Before the addressee decide to refuse or return the document he or she should consider if there are circumstanced which can be based to assume that he or she understand polish language. For example he or she used documents during doing business in this language, If from these circumstances the court can assume that he or she knows polish languages – this return or refusal can be treat as illegal.
Additionaly not all documentation should be translated. If we have a claim and enclosed documents – these appendix may be not translated.
After receiving documents the addressee should start action to protect his or her rights before polish court.
Ewa Kosowska-Czapla
Attorney-at-law / Restructuring Advisor
In our practice we often encounter a situation when foreign entrepreneurs conduct business activity in Poland in the form of a limited liability company.
Due to the barriers on the Polish market, in particular the language barrier, as well as numerous duties related to the activity in the home country, entrepreneurs are looking for a "manager" for their activity.
Foreign entrepreneurs want to be a member of the management board of the created Companies, in order to ensure that they are able to influence their business on an ongoing basis. Then they often appoint a proxy, who becomes the "manager" of the Company.
At the same time, a distinction should be made between the sphere of activity of a proxy as a representative of the Company, i.e. "outside", and the internal sphere, i.e. relations between the Company and the proxy.
As far as the proxy's activity as a representative of the Company is concerned, I would like to point out the following.
In principle, by virtue of the power of proxy granted, the commercial proxy may represent the Company before all entities, e.g. contractors, offices, employees in activities related to running the enterprise. Therefore, it is worth bearing in mind that all agreements concluded by a commercial proxy in the performance of business activity will be binding for the Company, regardless of whether - in the opinion of a foreign contractor - they are beneficial for the Company or not. Therefore, the Company will have to meet the obligations assumed by the commercial proxy.
In accordance with the provisions of law, the proxy must hold a special power of attorney to perform such activities as:
As far as, for example, the proxy of a limited liability company is concerned, in some situations a resolution of the shareholders will also be necessary for its important and effective operation.
According to the provision of Article 228 of the Polish Commercial Companies Code (k.s.h.), a resolution of shareholders is required, among other things:
On the other hand, the provision of art. 15 § 1 of the Polish Commercial Companies Code indicates that the conclusion by a capital company of a credit, loan, surety or other similar agreement with a proxy or on his behalf requires the consent of the general meeting of shareholders, unless the Act provides otherwise.
The proxy may also be organized in such a way as to make it impossible for the proxy to act independently by establishing a joint proxy, but only with another proxy (Article 1094 § 1 of the Civil Code). The proxy can be set also since 2016 to perform activities jointly with a member of the management board or a partner authorized to represent the partnership.
Information on whether the proxy may act jointly or independently is available in the register of entrepreneurs (provision of Article 1098 § 2 of the Civil Code).
If the company has a branch, the power of attorney may be limited to matters entered in the register of the branch.
As far as the relations between the proxy and the Company are concerned, I would like to point out the following.
At the same time, the Company should have an agreement with the proxy, in which the rules of cooperation (employment contract, managerial contract, contract of mandate) will be regulated. Some entrepreneurs stipulate in these agreements that the proxy may not conclude transactions exceeding a certain value. It is worth pointing out, however, that such reservations are not effective against three persons, but only in the internal relationship between the Company and the proxy. According to the provision of art. 1091 § 2 of the Civil Code, a commercial proxy may not be limited with effect in relation to third parties, unless a specific provision provides otherwise. Thus, only the provisions of law may decide that the proxy will not have the right of unrestricted representation.
The Proxy shall not be liable towards third parties for the Company's obligations. The Company is responsible for its obligations. In certain cases, members of the Management Board are liable. The fact that a proxy has been appointed does not release the Management Board from its duties related to the Company's operations. Therefore, the Management Board should supervise the proxy on an ongoing basis. In particular, the Management Board should take care that the proxy's actions are compliant with the law and are undertaken in the interest of the Company. The Management Board should monitor the financial situation of the Company on an ongoing basis.
If the proxy acts to the detriment of the Company, it may be necessary to immediately dismiss the proxy, terminate the agreement between the parties and pursue claims for damages against the proxy before the Court.
Ewa Kosowska-Czapla
Attorney-at-law
A wine producer within the meaning of the Polish Wine Act is:
In order to be recognised as a wine producer, not only should the wine be made or bottled but also marketed. Therefore, if we make wine for our own needs, we will not be recognized as a producer. Similarly, if we do not have our own crops. (Article 2(1)(21) of the Polish Wine Act).
Issue not legally clarified due to incoherence of concepts. An exemplary attempt to solve the problem was presented.
The regulations of the Polish Law of Entrepreneurs, and thus the necessity of entry in the CEiDG do not apply to:
They may be entered:
https://prod.ceidg.gov.pl/ceidg.cms.engine/?F;1b22de7d-916d-4591-b44d-3b8e2be61121
A farmer as defined in Article 2(a) of Council Regulation (EC) No 73/2009
"agricultural activity” means, inter alia, the production of agricultural products,
"agricultural products” means the products, with the exception of fishery products, listed in Annex I to the Treaties, as well as cotton.
The Treaty mentions:
Grape must, fermenting or with fermentation stopped otherwise than by the addition of alcohol; Wine of fresh grapes; grape must with fermentation stopped by the addition of alcohol; Other fermented beverages (e.g. cider, perry and mead).
Entry of the farmer in the register of agricultural producers
An entry in the register of producers shall be made, by way of an administrative decision, at the request of the head of the district office of the Agency for Restructuring and Modernisation of Agriculture with territorial jurisdiction, on a form drawn up and made available by the Agency.
https://www.arimr.gov.pl/dla-beneficjenta/wszystkie-wnioski/ewidencja-producentow.html
Entry in the ministerial register of 'winemakers' - regulated activities
Article 17(1) Economic activity within the scope of production or bottling of wine products is a regulated activity within the meaning of the provisions of the Act of 6 March 2018. - The Law of Entrepreneurs (Journal of Laws, item 646) and requires an entry in the Register of Entrepreneurs performing activities related to the production or bottling of wine products, hereinafter referred to as "the Register".
(2)The business activity in the field of wine products may also include bottling of wine products.
(3) The requirements for registration shall not apply to producers who exclusively make and bottle wine obtained from grapes grown in their own right.
Ministerial register
The legal basis for keeping the register is Article 20 of the Act of 12 May 2011 on the manufacture and bottling of wine products, trade in such products and organisation of the wine market (Journal of Laws of 2016, item 859, as amended), hereinafter referred to as the "Act".
Each producer and entrepreneur making wine from grapes obtained from vines located on the territory of the Republic of Poland to be marketed should be entered in the register kept by the Polish Director General of the KOWR (National Agricultural Support Centre) and submit certain documents.
http://www.kowr.gov.pl/interwencja/wino/pytania-dotyczace-rynku-wina
http://bip.stat.gov.pl/dzialalnosc-statystyki-publicznej/rejestr-regon/formularze-regon-papierowe/
https://www.biznes.gov.pl/pl/firma/sprawy-urzedowe/chce-dostac-pozwolenie-na-sprzedaz-alkoholu/proc_280 - permit for sale of alcohol
https://www.biznes.gov.pl/pl/firma/zezwolenia-koncesje-wpisy-do-rejestru/chce-uzyskac-zezwolenie-koncesje-wpis-do-rejestru-dzialalnosci-regulowanej54/proc_214-Wholesale/License for Wholesale Alcohols
https://ijhars.gov.pl/certyfikacja-wina.html3.
https://www.biznes.gov.pl/pl/firma/sprzedaz-i-marketing/chce-wprowadzic-produkt-usluge-na-rynek/proc_520-entry-enterprise-do-register-sanepid
https://www.biznes.gov.pl/pl/firma/sprzedaz-i-marketing/chce-wprowadzic-produkt-usluge-na-rynek/proc_521- approval-plant-i-entry-do-register-sanepid register
I invite you to get acquainted with the above material in the form of a film: https://www.youtube.com/watch?v=Vljogovulo
Ewa Kosowska- Czapla
Attorney-at-law/ Restructuring adviser
The concept of insolvency in Polish law has significant legal consequences. Insolvency is closely related to the necessity of filing a petition for bankruptcy by the obliged and determines the declaration of bankruptcy by the court. There are also serious consequences for certain entities related to the lack of timely filing of a bankruptcy petition.
Thus, each entrepreneur should monitor the condition of his company on an ongoing basis in order to respond to the state of insolvency in a timely and appropriate manner. Recently, as a result of the amendment to the bankruptcy and reorganisation law, which entered into force on 1 January 2016, the provisions on insolvency have changed quite significantly.
Bankruptcy is declared against a debtor who has become insolvent (Article 10 of the Polish Insolvency Law). Therefore the state of insolvency is a state which obliges the entrepreneur to file for bankruptcy. Pursuant to Article 21(1) of the Polish Insolvency Law, the debtor is obliged, not later than within thirty days from the date on which the basis for declaring bankruptcy occurred, to file a motion for declaring bankruptcy to the court.
Pursuant to Article 11(1) of the Polish Insolvency Law, a debtor is insolvent if he has lost the ability to fulfil his chargeable pecuniary obligations. A presumption has been introduced according to which the debtor is presumed to have lost the capacity to perform his chargeable pecuniary obligations if the delay in the performance of the pecuniary obligations exceeds three months.
Pursuant to Article 11(2), a debtor who is a legal person or an organisational unit without legal personality, to which a separate act grants legal capacity, shall also be insolvent if its pecuniary obligations exceed the value of its assets and this state of affairs persists for a period exceeding twenty-four months.
The first criteria that apply to all debtors is the loss of the debtor's ability to fulfil its chargeable pecuniary obligations.
It is worth noting that insolvency relates only to pecuniary obligations. Therefore, as Piotr Zimmerman points out in his commentary, "A debtor who fails to perform obligations of a non-pecuniary nature on time is not insolvent until such obligations become pecuniary by contract or action of the creditor, even if he is in delay in performing them for more than 3 months". (Prawo upadłościowe. Komentarz. Piotr Zimmerman. Wydawnictwo C.H. Beck, Warszawa 2016, komentarz do przepisu art. 11, system informacji prawnej Legalis).
Monetary liabilities must be chargeable. As pointed out by the Supreme Court in the judgment of 22 March 2001, V CKN 769/00 "In doctrine and judicature, the chargeability of a debt is defined as the state in which the creditor has the legal possibility to demand satisfaction of his debt to which the creditor is entitled. This is a potential, objective state, whose beginning coincides with the activation of the debt ( see the justification of the Supreme Court's judgment of 12 February 1991, III CRN 500/90, OSNCP 1992, no. 7-8, item 137). The beginning of due date cannot be summarised as a single rule applicable to all legal relations, as it depends on the nature of the obligations and their properties. Only chargeability in relation to obligations of a timely nature is uniformly recorded. It is then assumed that the claim is due if the deadline for performance has come, as from that date the creditor may demand fulfilment of the performance that the debtor has to fulfil. The issue of maturities in respect of indefinite obligations is different (...). In this case, it is not acceptable to adopt a position identifying the due dates and performance, since Article 455 of Kodeks Postępowania Cywilnego (the Polish Civil Code), which defines the date of performance as "immediate" after being called by the creditor". According to the above, monetary obligations become chargeable on the date set as the payment date, provided that this date has been set correctly. On the other hand, indefinite pecuniary obligations become chargeable immediately after the creditor has been called upon to fulfil them. For example, when the debtor is unable, despite being due, to meet its obligations, it should consider filing a petition for bankruptcy. Entrepreneurs or members of the Management Board of the Company should be aware of the current financial condition of the Company, and thus the possibility of satisfying the debts.
A practical problem in determining the loss of ability to fulfil chargeable obligations is whether there must be more than one creditor unsatisfied. The literature assumes that there must be at least two creditors. Polish Insolvency law is intended to establish joint enforcement by creditors (Article 1(1) of the Polish Insolvency Law) and therefore does not address the situation where there is only one creditor.
As regards the nature of the obligations, that is, whether or not they are linked to the business, the reasons why the obligations are not fulfilled, or whether the obligations are of a public or private nature, it must be concluded that all these factors remain irrelevant for the possibility of establishing insolvency.
As indicated above, in order to facilitate the creditor's situation, a presumption has been introduced according to which a debtor is presumed to have lost the capacity to fulfil his pecuniary obligations if the delay in the performance of the pecuniary obligations exceeds three months. However, this presumption is a rebuttable presumption. The debtor can therefore prove that he has not lost the capacity to fulfil the pecuniary obligations that have fallen due and that the non-fulfilment of the obligations is of a temporary nature.
2. The predominance of liabilities over assets (over-indebtedness)
For legal persons ( for example limited liability companies, joint-stock companies) or organizational units without legal personality, to which a separate act grants legal capacity, there is an additional, independent prerequisite for declaring bankruptcy. As mentioned above, pursuant to Article 11(2), a debtor who is a legal person or an organisational unit without legal personality, whose legal capacity is granted by a separate act, shall be deemed insolvent even if its financial obligations exceed the value of its assets and this condition persists for a period exceeding twenty-four months. However, this premise does not apply to partnerships specified in the Commercial Companies Code in which at least one partner responsible for the company's obligations without limitation is a natural person ( for example, a limited partnership in which a natural person is a general partner).
Thus, an obligated entity must not only monitor the issue of timely payment of chargeable obligations, but also monitor the relationship between the liabilities and the value of assets.
The law establishes the principles helpful in determining whether monetary liabilities exceed the value of assets.
First of all, the assets do not include components that are not part of the bankruptcy mass. As Piotr Zimmerman points out in his commentary, this applies in particular to components as obviously excluded from the mass as leased, rented or leasehold objects, but also to objects owned by other entities on the basis of, for example, the reservation of ownership rights to the seller until the full price has been paid (Prawo upadłościowe. Komentarz. Piotr Zimmerman. Wydawnictwo C.H. Beck, Warszawa 2016, komentarz do przepisu art. 11, system informacji prawnej Legalis).
Secondly, pecuniary obligations do not include future obligations, including obligations under a suspensive condition and obligations towards a partner or shareholder under a loan or other legal transaction with similar effects, as referred to in Article 342(1)(4). These obligations are treated as uncertain obligations.
Thirdly, also on the occasion of this condition, the legislator provided for a legal presumption facilitating the creditor's situation. A debtor's pecuniary obligations shall be presumed to exceed the value of his assets if, according to the balance sheet, his liabilities, excluding provisions for liabilities and liabilities to affiliated entities, exceed the value of his assets, and this condition persists for a period exceeding twenty-four months. Creditors will therefore be able, on the basis of an analysis of the balance sheet, to assess the situation as to whether there is a presumption of over-indebtedness in a particular case. However, as it follows from the above, provisions for liabilities and liabilities towards related parties will not be taken into account in the assessment of the balance of liabilities. Therefore, the legal science indicates that disputed receivables will not be taken into account, as they are included in the balance sheet as "provisions for liabilities". However, this presumption is a rebuttable presumption. A debtor may therefore point out that, taking into account whether monetary obligations exceed the value of assets, his off-balance sheet assets, for example, estimated on the basis of market prices, should also be taken into account.
Ewa Kosowska-Czapla
Polish Attorney-at-law, Licensed Receiver
In December 2021, a government IT system for handling restructuring and insolvency cases was introduced in Poland. As a rule, the court, receivers, debtors and creditors are obliged to participate in the proceedings using this system. Paper documents are to disappear. Thus, paper filings or votes will not be honoured.
Our law firm helps foreign creditors to participate in restructuring and insolvency proceedings via the IT portal so that their claims and votes are properly valid.
Pursuant to the resolution of the Supreme Court of 12 January 2022, file ref. III CZP 67/22, conclusion by a joint-stock company of a surety agreement for a debt of a spouse who remains in statutory community with a management board member of that company requires consent of the general meeting (art. 15 § 1 of the Commercial Companies Code).
In Poland, because of Covid-19, a special simplified restructuring procedure was implemented. According to the law, until 30 June 2021, an insolvent or at risk of insolvency debtor who has concluded an agreement with a restructuring advisor to supervise the course of proceedings for the approval of an arrangement may announce in the special journal Monitor Sądowy i Gospodarczy the opening of proceedings for the approval of an arrangement conducted on the basis of the provisions of the Act of 15 May 2015. - Restructuring Law.
The announcement may be made after the debtor has prepared
- arrangement proposals and
- list of claims,
- list of disputed claims
and handing them over to the arrangement supervisor.
The date of making the announcement shall be the date on which the proceedings for approval of the arrangement are opened.
As of the date of making the announcement until the date of discontinuance or termination of the proceedings for approval of the arrangement, inter alia:
1)the enforcement proceedings concerning claims specified by law initiated before the date of the opening of the proceedings shall be suspended by way of law;
2)the commencement of enforcement proceedings and the enforcement of a decision to secure a claim or an order to secure a claim arising from claims specified by law shall be prohibited.
Claims specified by law under the rules indicated therein are included in the arrangement even without the creditor's consent.
At the request of the creditor, the debtor or the supervisor of the arrangement, the court shall waive the effects of making the announcement specified by law if they lead to the harm of the creditors.
Independently of the collection of votes, according to the procedure specified by the Act - Restructuring Law, the supervisor of the arrangement may appoint a date for a creditors' meeting to vote on the arrangement. The creditors' meeting is chaired by the supervisor of the arrangement.
If there are technical possibilities, voting at the creditors' meeting may be conducted using electronic means of communication.
The proceedings to approve the arrangement shall be discontinued by force of law if no application for approval of the arrangement is submitted to the court within four months of the date of the announcement.
At the request of the debtor, creditor or any other person having a legal interest therein, the court shall issue a decision stating that the proceedings are discontinued by force of law.
From the date of making the announcement until the date of discontinuance or termination of proceedings for approval of the arrangement, the debtor may perform ordinary management activities. The consent of the supervisor of the composition agreement is required for any activities that exceed the scope of ordinary management. Consent may also be given after the activity has been performed, within thirty days from the date of its performance. An act exceeding the scope of ordinary management made without the required consent is invalid.
Another advantage of this procedure is that, under certain conditions, as a result of the timely announcement of the opening of proceedings for the approval of the arrangement, the liability of certain persons on the grounds specified in the act is excluded.
Ewa Kosowska-Czapla
Attorney-at-law
That happend for foreign clients that they receive documents from polish court for example in Germany, Sweden or another country UE.
They do not know how to behave in this situation. This case is stated in regulation (EC) No 1393/2007 of the European Parliament and of the Council of 13 November 2007 on the service in the Member States of judicial and extrajudicial documents in civil or commercial matters (service of documents), and repealing Council Regulation (EC) No 1348/2000.
In article 14 of this regulation we read „Each Member State shall be free to effect service of judicial documents directly by postal services on persons residing in another Member State by registered letter with acknowledgement of receipt or equivalent.” It means that letter from polish court is legal if it was done by postal services by registered letter with acknowledgement of receipt or equivalent. Among documents from polish court could be: claim, judgement, calling for the hearing etc.
That is why you should not ignore that letter, ever if it is in polish.
The addressee can act in two ways in this case:
- he may refuse to accept the document to be served at the time of service,
- he may returning the document to the court within one week
if it is not written in, or accompanied by a translation into, either of the following languages:
- a language which the addressee understands or
- the official language of the Member State addressed or, if there are several official languages in that Member State, the official language or one of the official languages of the place where service is to be effected.
Before the addressee decide to refuse or return the document he or she should consider if there are circumstanced which can be based to assume that he or she understand polish language. For example he or she used documents during doing business in this language, If from these circumstances the court can assume that he or she knows polish languages – this return or refusal can be treat as illegal.
Additionaly not all documentation should be translated. If we have a claim and enclosed documents – these appendix may be not translated.
After receiving documents the addressee should start action to protect his or her rights before polish court.
Ewa Kosowska-Czapla
Attorney-at-law / Restructuring Advisor
In our practice we often encounter a situation when foreign entrepreneurs conduct business activity in Poland in the form of a limited liability company.
Due to the barriers on the Polish market, in particular the language barrier, as well as numerous duties related to the activity in the home country, entrepreneurs are looking for a "manager" for their activity.
Foreign entrepreneurs want to be a member of the management board of the created Companies, in order to ensure that they are able to influence their business on an ongoing basis. Then they often appoint a proxy, who becomes the "manager" of the Company.
At the same time, a distinction should be made between the sphere of activity of a proxy as a representative of the Company, i.e. "outside", and the internal sphere, i.e. relations between the Company and the proxy.
As far as the proxy's activity as a representative of the Company is concerned, I would like to point out the following.
In principle, by virtue of the power of proxy granted, the commercial proxy may represent the Company before all entities, e.g. contractors, offices, employees in activities related to running the enterprise. Therefore, it is worth bearing in mind that all agreements concluded by a commercial proxy in the performance of business activity will be binding for the Company, regardless of whether - in the opinion of a foreign contractor - they are beneficial for the Company or not. Therefore, the Company will have to meet the obligations assumed by the commercial proxy.
In accordance with the provisions of law, the proxy must hold a special power of attorney to perform such activities as:
As far as, for example, the proxy of a limited liability company is concerned, in some situations a resolution of the shareholders will also be necessary for its important and effective operation.
According to the provision of Article 228 of the Polish Commercial Companies Code (k.s.h.), a resolution of shareholders is required, among other things:
On the other hand, the provision of art. 15 § 1 of the Polish Commercial Companies Code indicates that the conclusion by a capital company of a credit, loan, surety or other similar agreement with a proxy or on his behalf requires the consent of the general meeting of shareholders, unless the Act provides otherwise.
The proxy may also be organized in such a way as to make it impossible for the proxy to act independently by establishing a joint proxy, but only with another proxy (Article 1094 § 1 of the Civil Code). The proxy can be set also since 2016 to perform activities jointly with a member of the management board or a partner authorized to represent the partnership.
Information on whether the proxy may act jointly or independently is available in the register of entrepreneurs (provision of Article 1098 § 2 of the Civil Code).
If the company has a branch, the power of attorney may be limited to matters entered in the register of the branch.
As far as the relations between the proxy and the Company are concerned, I would like to point out the following.
At the same time, the Company should have an agreement with the proxy, in which the rules of cooperation (employment contract, managerial contract, contract of mandate) will be regulated. Some entrepreneurs stipulate in these agreements that the proxy may not conclude transactions exceeding a certain value. It is worth pointing out, however, that such reservations are not effective against three persons, but only in the internal relationship between the Company and the proxy. According to the provision of art. 1091 § 2 of the Civil Code, a commercial proxy may not be limited with effect in relation to third parties, unless a specific provision provides otherwise. Thus, only the provisions of law may decide that the proxy will not have the right of unrestricted representation.
The Proxy shall not be liable towards third parties for the Company's obligations. The Company is responsible for its obligations. In certain cases, members of the Management Board are liable. The fact that a proxy has been appointed does not release the Management Board from its duties related to the Company's operations. Therefore, the Management Board should supervise the proxy on an ongoing basis. In particular, the Management Board should take care that the proxy's actions are compliant with the law and are undertaken in the interest of the Company. The Management Board should monitor the financial situation of the Company on an ongoing basis.
If the proxy acts to the detriment of the Company, it may be necessary to immediately dismiss the proxy, terminate the agreement between the parties and pursue claims for damages against the proxy before the Court.
Ewa Kosowska-Czapla
Attorney-at-law
A wine producer within the meaning of the Polish Wine Act is:
In order to be recognised as a wine producer, not only should the wine be made or bottled but also marketed. Therefore, if we make wine for our own needs, we will not be recognized as a producer. Similarly, if we do not have our own crops. (Article 2(1)(21) of the Polish Wine Act).
Issue not legally clarified due to incoherence of concepts. An exemplary attempt to solve the problem was presented.
The regulations of the Polish Law of Entrepreneurs, and thus the necessity of entry in the CEiDG do not apply to:
They may be entered:
https://prod.ceidg.gov.pl/ceidg.cms.engine/?F;1b22de7d-916d-4591-b44d-3b8e2be61121
A farmer as defined in Article 2(a) of Council Regulation (EC) No 73/2009
"agricultural activity” means, inter alia, the production of agricultural products,
"agricultural products” means the products, with the exception of fishery products, listed in Annex I to the Treaties, as well as cotton.
The Treaty mentions:
Grape must, fermenting or with fermentation stopped otherwise than by the addition of alcohol; Wine of fresh grapes; grape must with fermentation stopped by the addition of alcohol; Other fermented beverages (e.g. cider, perry and mead).
Entry of the farmer in the register of agricultural producers
An entry in the register of producers shall be made, by way of an administrative decision, at the request of the head of the district office of the Agency for Restructuring and Modernisation of Agriculture with territorial jurisdiction, on a form drawn up and made available by the Agency.
https://www.arimr.gov.pl/dla-beneficjenta/wszystkie-wnioski/ewidencja-producentow.html
Entry in the ministerial register of 'winemakers' - regulated activities
Article 17(1) Economic activity within the scope of production or bottling of wine products is a regulated activity within the meaning of the provisions of the Act of 6 March 2018. - The Law of Entrepreneurs (Journal of Laws, item 646) and requires an entry in the Register of Entrepreneurs performing activities related to the production or bottling of wine products, hereinafter referred to as "the Register".
(2)The business activity in the field of wine products may also include bottling of wine products.
(3) The requirements for registration shall not apply to producers who exclusively make and bottle wine obtained from grapes grown in their own right.
Ministerial register
The legal basis for keeping the register is Article 20 of the Act of 12 May 2011 on the manufacture and bottling of wine products, trade in such products and organisation of the wine market (Journal of Laws of 2016, item 859, as amended), hereinafter referred to as the "Act".
Each producer and entrepreneur making wine from grapes obtained from vines located on the territory of the Republic of Poland to be marketed should be entered in the register kept by the Polish Director General of the KOWR (National Agricultural Support Centre) and submit certain documents.
http://www.kowr.gov.pl/interwencja/wino/pytania-dotyczace-rynku-wina
http://bip.stat.gov.pl/dzialalnosc-statystyki-publicznej/rejestr-regon/formularze-regon-papierowe/
https://www.biznes.gov.pl/pl/firma/sprawy-urzedowe/chce-dostac-pozwolenie-na-sprzedaz-alkoholu/proc_280 - permit for sale of alcohol
https://www.biznes.gov.pl/pl/firma/zezwolenia-koncesje-wpisy-do-rejestru/chce-uzyskac-zezwolenie-koncesje-wpis-do-rejestru-dzialalnosci-regulowanej54/proc_214-Wholesale/License for Wholesale Alcohols
https://ijhars.gov.pl/certyfikacja-wina.html3.
https://www.biznes.gov.pl/pl/firma/sprzedaz-i-marketing/chce-wprowadzic-produkt-usluge-na-rynek/proc_520-entry-enterprise-do-register-sanepid
https://www.biznes.gov.pl/pl/firma/sprzedaz-i-marketing/chce-wprowadzic-produkt-usluge-na-rynek/proc_521- approval-plant-i-entry-do-register-sanepid register
I invite you to get acquainted with the above material in the form of a film: https://www.youtube.com/watch?v=Vljogovulo
Ewa Kosowska- Czapla
Attorney-at-law/ Restructuring adviser
The concept of insolvency in Polish law has significant legal consequences. Insolvency is closely related to the necessity of filing a petition for bankruptcy by the obliged and determines the declaration of bankruptcy by the court. There are also serious consequences for certain entities related to the lack of timely filing of a bankruptcy petition.
Thus, each entrepreneur should monitor the condition of his company on an ongoing basis in order to respond to the state of insolvency in a timely and appropriate manner. Recently, as a result of the amendment to the bankruptcy and reorganisation law, which entered into force on 1 January 2016, the provisions on insolvency have changed quite significantly.
Bankruptcy is declared against a debtor who has become insolvent (Article 10 of the Polish Insolvency Law). Therefore the state of insolvency is a state which obliges the entrepreneur to file for bankruptcy. Pursuant to Article 21(1) of the Polish Insolvency Law, the debtor is obliged, not later than within thirty days from the date on which the basis for declaring bankruptcy occurred, to file a motion for declaring bankruptcy to the court.
Pursuant to Article 11(1) of the Polish Insolvency Law, a debtor is insolvent if he has lost the ability to fulfil his chargeable pecuniary obligations. A presumption has been introduced according to which the debtor is presumed to have lost the capacity to perform his chargeable pecuniary obligations if the delay in the performance of the pecuniary obligations exceeds three months.
Pursuant to Article 11(2), a debtor who is a legal person or an organisational unit without legal personality, to which a separate act grants legal capacity, shall also be insolvent if its pecuniary obligations exceed the value of its assets and this state of affairs persists for a period exceeding twenty-four months.
The first criteria that apply to all debtors is the loss of the debtor's ability to fulfil its chargeable pecuniary obligations.
It is worth noting that insolvency relates only to pecuniary obligations. Therefore, as Piotr Zimmerman points out in his commentary, "A debtor who fails to perform obligations of a non-pecuniary nature on time is not insolvent until such obligations become pecuniary by contract or action of the creditor, even if he is in delay in performing them for more than 3 months". (Prawo upadłościowe. Komentarz. Piotr Zimmerman. Wydawnictwo C.H. Beck, Warszawa 2016, komentarz do przepisu art. 11, system informacji prawnej Legalis).
Monetary liabilities must be chargeable. As pointed out by the Supreme Court in the judgment of 22 March 2001, V CKN 769/00 "In doctrine and judicature, the chargeability of a debt is defined as the state in which the creditor has the legal possibility to demand satisfaction of his debt to which the creditor is entitled. This is a potential, objective state, whose beginning coincides with the activation of the debt ( see the justification of the Supreme Court's judgment of 12 February 1991, III CRN 500/90, OSNCP 1992, no. 7-8, item 137). The beginning of due date cannot be summarised as a single rule applicable to all legal relations, as it depends on the nature of the obligations and their properties. Only chargeability in relation to obligations of a timely nature is uniformly recorded. It is then assumed that the claim is due if the deadline for performance has come, as from that date the creditor may demand fulfilment of the performance that the debtor has to fulfil. The issue of maturities in respect of indefinite obligations is different (...). In this case, it is not acceptable to adopt a position identifying the due dates and performance, since Article 455 of Kodeks Postępowania Cywilnego (the Polish Civil Code), which defines the date of performance as "immediate" after being called by the creditor". According to the above, monetary obligations become chargeable on the date set as the payment date, provided that this date has been set correctly. On the other hand, indefinite pecuniary obligations become chargeable immediately after the creditor has been called upon to fulfil them. For example, when the debtor is unable, despite being due, to meet its obligations, it should consider filing a petition for bankruptcy. Entrepreneurs or members of the Management Board of the Company should be aware of the current financial condition of the Company, and thus the possibility of satisfying the debts.
A practical problem in determining the loss of ability to fulfil chargeable obligations is whether there must be more than one creditor unsatisfied. The literature assumes that there must be at least two creditors. Polish Insolvency law is intended to establish joint enforcement by creditors (Article 1(1) of the Polish Insolvency Law) and therefore does not address the situation where there is only one creditor.
As regards the nature of the obligations, that is, whether or not they are linked to the business, the reasons why the obligations are not fulfilled, or whether the obligations are of a public or private nature, it must be concluded that all these factors remain irrelevant for the possibility of establishing insolvency.
As indicated above, in order to facilitate the creditor's situation, a presumption has been introduced according to which a debtor is presumed to have lost the capacity to fulfil his pecuniary obligations if the delay in the performance of the pecuniary obligations exceeds three months. However, this presumption is a rebuttable presumption. The debtor can therefore prove that he has not lost the capacity to fulfil the pecuniary obligations that have fallen due and that the non-fulfilment of the obligations is of a temporary nature.
2. The predominance of liabilities over assets (over-indebtedness)
For legal persons ( for example limited liability companies, joint-stock companies) or organizational units without legal personality, to which a separate act grants legal capacity, there is an additional, independent prerequisite for declaring bankruptcy. As mentioned above, pursuant to Article 11(2), a debtor who is a legal person or an organisational unit without legal personality, whose legal capacity is granted by a separate act, shall be deemed insolvent even if its financial obligations exceed the value of its assets and this condition persists for a period exceeding twenty-four months. However, this premise does not apply to partnerships specified in the Commercial Companies Code in which at least one partner responsible for the company's obligations without limitation is a natural person ( for example, a limited partnership in which a natural person is a general partner).
Thus, an obligated entity must not only monitor the issue of timely payment of chargeable obligations, but also monitor the relationship between the liabilities and the value of assets.
The law establishes the principles helpful in determining whether monetary liabilities exceed the value of assets.
First of all, the assets do not include components that are not part of the bankruptcy mass. As Piotr Zimmerman points out in his commentary, this applies in particular to components as obviously excluded from the mass as leased, rented or leasehold objects, but also to objects owned by other entities on the basis of, for example, the reservation of ownership rights to the seller until the full price has been paid (Prawo upadłościowe. Komentarz. Piotr Zimmerman. Wydawnictwo C.H. Beck, Warszawa 2016, komentarz do przepisu art. 11, system informacji prawnej Legalis).
Secondly, pecuniary obligations do not include future obligations, including obligations under a suspensive condition and obligations towards a partner or shareholder under a loan or other legal transaction with similar effects, as referred to in Article 342(1)(4). These obligations are treated as uncertain obligations.
Thirdly, also on the occasion of this condition, the legislator provided for a legal presumption facilitating the creditor's situation. A debtor's pecuniary obligations shall be presumed to exceed the value of his assets if, according to the balance sheet, his liabilities, excluding provisions for liabilities and liabilities to affiliated entities, exceed the value of his assets, and this condition persists for a period exceeding twenty-four months. Creditors will therefore be able, on the basis of an analysis of the balance sheet, to assess the situation as to whether there is a presumption of over-indebtedness in a particular case. However, as it follows from the above, provisions for liabilities and liabilities towards related parties will not be taken into account in the assessment of the balance of liabilities. Therefore, the legal science indicates that disputed receivables will not be taken into account, as they are included in the balance sheet as "provisions for liabilities". However, this presumption is a rebuttable presumption. A debtor may therefore point out that, taking into account whether monetary obligations exceed the value of assets, his off-balance sheet assets, for example, estimated on the basis of market prices, should also be taken into account.
Ewa Kosowska-Czapla
Polish Attorney-at-law, Licensed Receiver
In December 2021, a government IT system for handling restructuring and insolvency cases was introduced in Poland. As a rule, the court, receivers, debtors and creditors are obliged to participate in the proceedings using this system. Paper documents are to disappear. Thus, paper filings or votes will not be honoured.
Our law firm helps foreign creditors to participate in restructuring and insolvency proceedings via the IT portal so that their claims and votes are properly valid.
Pursuant to the resolution of the Supreme Court of 12 January 2022, file ref. III CZP 67/22, conclusion by a joint-stock company of a surety agreement for a debt of a spouse who remains in statutory community with a management board member of that company requires consent of the general meeting (art. 15 § 1 of the Commercial Companies Code).
In Poland, because of Covid-19, a special simplified restructuring procedure was implemented. According to the law, until 30 June 2021, an insolvent or at risk of insolvency debtor who has concluded an agreement with a restructuring advisor to supervise the course of proceedings for the approval of an arrangement may announce in the special journal Monitor Sądowy i Gospodarczy the opening of proceedings for the approval of an arrangement conducted on the basis of the provisions of the Act of 15 May 2015. - Restructuring Law.
The announcement may be made after the debtor has prepared
- arrangement proposals and
- list of claims,
- list of disputed claims
and handing them over to the arrangement supervisor.
The date of making the announcement shall be the date on which the proceedings for approval of the arrangement are opened.
As of the date of making the announcement until the date of discontinuance or termination of the proceedings for approval of the arrangement, inter alia:
1)the enforcement proceedings concerning claims specified by law initiated before the date of the opening of the proceedings shall be suspended by way of law;
2)the commencement of enforcement proceedings and the enforcement of a decision to secure a claim or an order to secure a claim arising from claims specified by law shall be prohibited.
Claims specified by law under the rules indicated therein are included in the arrangement even without the creditor's consent.
At the request of the creditor, the debtor or the supervisor of the arrangement, the court shall waive the effects of making the announcement specified by law if they lead to the harm of the creditors.
Independently of the collection of votes, according to the procedure specified by the Act - Restructuring Law, the supervisor of the arrangement may appoint a date for a creditors' meeting to vote on the arrangement. The creditors' meeting is chaired by the supervisor of the arrangement.
If there are technical possibilities, voting at the creditors' meeting may be conducted using electronic means of communication.
The proceedings to approve the arrangement shall be discontinued by force of law if no application for approval of the arrangement is submitted to the court within four months of the date of the announcement.
At the request of the debtor, creditor or any other person having a legal interest therein, the court shall issue a decision stating that the proceedings are discontinued by force of law.
From the date of making the announcement until the date of discontinuance or termination of proceedings for approval of the arrangement, the debtor may perform ordinary management activities. The consent of the supervisor of the composition agreement is required for any activities that exceed the scope of ordinary management. Consent may also be given after the activity has been performed, within thirty days from the date of its performance. An act exceeding the scope of ordinary management made without the required consent is invalid.
Another advantage of this procedure is that, under certain conditions, as a result of the timely announcement of the opening of proceedings for the approval of the arrangement, the liability of certain persons on the grounds specified in the act is excluded.
Ewa Kosowska-Czapla
Attorney-at-law
That happend for foreign clients that they receive documents from polish court for example in Germany, Sweden or another country UE.
They do not know how to behave in this situation. This case is stated in regulation (EC) No 1393/2007 of the European Parliament and of the Council of 13 November 2007 on the service in the Member States of judicial and extrajudicial documents in civil or commercial matters (service of documents), and repealing Council Regulation (EC) No 1348/2000.
In article 14 of this regulation we read „Each Member State shall be free to effect service of judicial documents directly by postal services on persons residing in another Member State by registered letter with acknowledgement of receipt or equivalent.” It means that letter from polish court is legal if it was done by postal services by registered letter with acknowledgement of receipt or equivalent. Among documents from polish court could be: claim, judgement, calling for the hearing etc.
That is why you should not ignore that letter, ever if it is in polish.
The addressee can act in two ways in this case:
- he may refuse to accept the document to be served at the time of service,
- he may returning the document to the court within one week
if it is not written in, or accompanied by a translation into, either of the following languages:
- a language which the addressee understands or
- the official language of the Member State addressed or, if there are several official languages in that Member State, the official language or one of the official languages of the place where service is to be effected.
Before the addressee decide to refuse or return the document he or she should consider if there are circumstanced which can be based to assume that he or she understand polish language. For example he or she used documents during doing business in this language, If from these circumstances the court can assume that he or she knows polish languages – this return or refusal can be treat as illegal.
Additionaly not all documentation should be translated. If we have a claim and enclosed documents – these appendix may be not translated.
After receiving documents the addressee should start action to protect his or her rights before polish court.
Ewa Kosowska-Czapla
Attorney-at-law / Restructuring Advisor
In our practice we often encounter a situation when foreign entrepreneurs conduct business activity in Poland in the form of a limited liability company.
Due to the barriers on the Polish market, in particular the language barrier, as well as numerous duties related to the activity in the home country, entrepreneurs are looking for a "manager" for their activity.
Foreign entrepreneurs want to be a member of the management board of the created Companies, in order to ensure that they are able to influence their business on an ongoing basis. Then they often appoint a proxy, who becomes the "manager" of the Company.
At the same time, a distinction should be made between the sphere of activity of a proxy as a representative of the Company, i.e. "outside", and the internal sphere, i.e. relations between the Company and the proxy.
As far as the proxy's activity as a representative of the Company is concerned, I would like to point out the following.
In principle, by virtue of the power of proxy granted, the commercial proxy may represent the Company before all entities, e.g. contractors, offices, employees in activities related to running the enterprise. Therefore, it is worth bearing in mind that all agreements concluded by a commercial proxy in the performance of business activity will be binding for the Company, regardless of whether - in the opinion of a foreign contractor - they are beneficial for the Company or not. Therefore, the Company will have to meet the obligations assumed by the commercial proxy.
In accordance with the provisions of law, the proxy must hold a special power of attorney to perform such activities as:
As far as, for example, the proxy of a limited liability company is concerned, in some situations a resolution of the shareholders will also be necessary for its important and effective operation.
According to the provision of Article 228 of the Polish Commercial Companies Code (k.s.h.), a resolution of shareholders is required, among other things:
On the other hand, the provision of art. 15 § 1 of the Polish Commercial Companies Code indicates that the conclusion by a capital company of a credit, loan, surety or other similar agreement with a proxy or on his behalf requires the consent of the general meeting of shareholders, unless the Act provides otherwise.
The proxy may also be organized in such a way as to make it impossible for the proxy to act independently by establishing a joint proxy, but only with another proxy (Article 1094 § 1 of the Civil Code). The proxy can be set also since 2016 to perform activities jointly with a member of the management board or a partner authorized to represent the partnership.
Information on whether the proxy may act jointly or independently is available in the register of entrepreneurs (provision of Article 1098 § 2 of the Civil Code).
If the company has a branch, the power of attorney may be limited to matters entered in the register of the branch.
As far as the relations between the proxy and the Company are concerned, I would like to point out the following.
At the same time, the Company should have an agreement with the proxy, in which the rules of cooperation (employment contract, managerial contract, contract of mandate) will be regulated. Some entrepreneurs stipulate in these agreements that the proxy may not conclude transactions exceeding a certain value. It is worth pointing out, however, that such reservations are not effective against three persons, but only in the internal relationship between the Company and the proxy. According to the provision of art. 1091 § 2 of the Civil Code, a commercial proxy may not be limited with effect in relation to third parties, unless a specific provision provides otherwise. Thus, only the provisions of law may decide that the proxy will not have the right of unrestricted representation.
The Proxy shall not be liable towards third parties for the Company's obligations. The Company is responsible for its obligations. In certain cases, members of the Management Board are liable. The fact that a proxy has been appointed does not release the Management Board from its duties related to the Company's operations. Therefore, the Management Board should supervise the proxy on an ongoing basis. In particular, the Management Board should take care that the proxy's actions are compliant with the law and are undertaken in the interest of the Company. The Management Board should monitor the financial situation of the Company on an ongoing basis.
If the proxy acts to the detriment of the Company, it may be necessary to immediately dismiss the proxy, terminate the agreement between the parties and pursue claims for damages against the proxy before the Court.
Ewa Kosowska-Czapla
Attorney-at-law
A wine producer within the meaning of the Polish Wine Act is:
In order to be recognised as a wine producer, not only should the wine be made or bottled but also marketed. Therefore, if we make wine for our own needs, we will not be recognized as a producer. Similarly, if we do not have our own crops. (Article 2(1)(21) of the Polish Wine Act).
Issue not legally clarified due to incoherence of concepts. An exemplary attempt to solve the problem was presented.
The regulations of the Polish Law of Entrepreneurs, and thus the necessity of entry in the CEiDG do not apply to:
They may be entered:
https://prod.ceidg.gov.pl/ceidg.cms.engine/?F;1b22de7d-916d-4591-b44d-3b8e2be61121
A farmer as defined in Article 2(a) of Council Regulation (EC) No 73/2009
"agricultural activity” means, inter alia, the production of agricultural products,
"agricultural products” means the products, with the exception of fishery products, listed in Annex I to the Treaties, as well as cotton.
The Treaty mentions:
Grape must, fermenting or with fermentation stopped otherwise than by the addition of alcohol; Wine of fresh grapes; grape must with fermentation stopped by the addition of alcohol; Other fermented beverages (e.g. cider, perry and mead).
Entry of the farmer in the register of agricultural producers
An entry in the register of producers shall be made, by way of an administrative decision, at the request of the head of the district office of the Agency for Restructuring and Modernisation of Agriculture with territorial jurisdiction, on a form drawn up and made available by the Agency.
https://www.arimr.gov.pl/dla-beneficjenta/wszystkie-wnioski/ewidencja-producentow.html
Entry in the ministerial register of 'winemakers' - regulated activities
Article 17(1) Economic activity within the scope of production or bottling of wine products is a regulated activity within the meaning of the provisions of the Act of 6 March 2018. - The Law of Entrepreneurs (Journal of Laws, item 646) and requires an entry in the Register of Entrepreneurs performing activities related to the production or bottling of wine products, hereinafter referred to as "the Register".
(2)The business activity in the field of wine products may also include bottling of wine products.
(3) The requirements for registration shall not apply to producers who exclusively make and bottle wine obtained from grapes grown in their own right.
Ministerial register
The legal basis for keeping the register is Article 20 of the Act of 12 May 2011 on the manufacture and bottling of wine products, trade in such products and organisation of the wine market (Journal of Laws of 2016, item 859, as amended), hereinafter referred to as the "Act".
Each producer and entrepreneur making wine from grapes obtained from vines located on the territory of the Republic of Poland to be marketed should be entered in the register kept by the Polish Director General of the KOWR (National Agricultural Support Centre) and submit certain documents.
http://www.kowr.gov.pl/interwencja/wino/pytania-dotyczace-rynku-wina
http://bip.stat.gov.pl/dzialalnosc-statystyki-publicznej/rejestr-regon/formularze-regon-papierowe/
https://www.biznes.gov.pl/pl/firma/sprawy-urzedowe/chce-dostac-pozwolenie-na-sprzedaz-alkoholu/proc_280 - permit for sale of alcohol
https://www.biznes.gov.pl/pl/firma/zezwolenia-koncesje-wpisy-do-rejestru/chce-uzyskac-zezwolenie-koncesje-wpis-do-rejestru-dzialalnosci-regulowanej54/proc_214-Wholesale/License for Wholesale Alcohols
https://ijhars.gov.pl/certyfikacja-wina.html3.
https://www.biznes.gov.pl/pl/firma/sprzedaz-i-marketing/chce-wprowadzic-produkt-usluge-na-rynek/proc_520-entry-enterprise-do-register-sanepid
https://www.biznes.gov.pl/pl/firma/sprzedaz-i-marketing/chce-wprowadzic-produkt-usluge-na-rynek/proc_521- approval-plant-i-entry-do-register-sanepid register
I invite you to get acquainted with the above material in the form of a film: https://www.youtube.com/watch?v=Vljogovulo
Ewa Kosowska- Czapla
Attorney-at-law/ Restructuring adviser
The concept of insolvency in Polish law has significant legal consequences. Insolvency is closely related to the necessity of filing a petition for bankruptcy by the obliged and determines the declaration of bankruptcy by the court. There are also serious consequences for certain entities related to the lack of timely filing of a bankruptcy petition.
Thus, each entrepreneur should monitor the condition of his company on an ongoing basis in order to respond to the state of insolvency in a timely and appropriate manner. Recently, as a result of the amendment to the bankruptcy and reorganisation law, which entered into force on 1 January 2016, the provisions on insolvency have changed quite significantly.
Bankruptcy is declared against a debtor who has become insolvent (Article 10 of the Polish Insolvency Law). Therefore the state of insolvency is a state which obliges the entrepreneur to file for bankruptcy. Pursuant to Article 21(1) of the Polish Insolvency Law, the debtor is obliged, not later than within thirty days from the date on which the basis for declaring bankruptcy occurred, to file a motion for declaring bankruptcy to the court.
Pursuant to Article 11(1) of the Polish Insolvency Law, a debtor is insolvent if he has lost the ability to fulfil his chargeable pecuniary obligations. A presumption has been introduced according to which the debtor is presumed to have lost the capacity to perform his chargeable pecuniary obligations if the delay in the performance of the pecuniary obligations exceeds three months.
Pursuant to Article 11(2), a debtor who is a legal person or an organisational unit without legal personality, to which a separate act grants legal capacity, shall also be insolvent if its pecuniary obligations exceed the value of its assets and this state of affairs persists for a period exceeding twenty-four months.
The first criteria that apply to all debtors is the loss of the debtor's ability to fulfil its chargeable pecuniary obligations.
It is worth noting that insolvency relates only to pecuniary obligations. Therefore, as Piotr Zimmerman points out in his commentary, "A debtor who fails to perform obligations of a non-pecuniary nature on time is not insolvent until such obligations become pecuniary by contract or action of the creditor, even if he is in delay in performing them for more than 3 months". (Prawo upadłościowe. Komentarz. Piotr Zimmerman. Wydawnictwo C.H. Beck, Warszawa 2016, komentarz do przepisu art. 11, system informacji prawnej Legalis).
Monetary liabilities must be chargeable. As pointed out by the Supreme Court in the judgment of 22 March 2001, V CKN 769/00 "In doctrine and judicature, the chargeability of a debt is defined as the state in which the creditor has the legal possibility to demand satisfaction of his debt to which the creditor is entitled. This is a potential, objective state, whose beginning coincides with the activation of the debt ( see the justification of the Supreme Court's judgment of 12 February 1991, III CRN 500/90, OSNCP 1992, no. 7-8, item 137). The beginning of due date cannot be summarised as a single rule applicable to all legal relations, as it depends on the nature of the obligations and their properties. Only chargeability in relation to obligations of a timely nature is uniformly recorded. It is then assumed that the claim is due if the deadline for performance has come, as from that date the creditor may demand fulfilment of the performance that the debtor has to fulfil. The issue of maturities in respect of indefinite obligations is different (...). In this case, it is not acceptable to adopt a position identifying the due dates and performance, since Article 455 of Kodeks Postępowania Cywilnego (the Polish Civil Code), which defines the date of performance as "immediate" after being called by the creditor". According to the above, monetary obligations become chargeable on the date set as the payment date, provided that this date has been set correctly. On the other hand, indefinite pecuniary obligations become chargeable immediately after the creditor has been called upon to fulfil them. For example, when the debtor is unable, despite being due, to meet its obligations, it should consider filing a petition for bankruptcy. Entrepreneurs or members of the Management Board of the Company should be aware of the current financial condition of the Company, and thus the possibility of satisfying the debts.
A practical problem in determining the loss of ability to fulfil chargeable obligations is whether there must be more than one creditor unsatisfied. The literature assumes that there must be at least two creditors. Polish Insolvency law is intended to establish joint enforcement by creditors (Article 1(1) of the Polish Insolvency Law) and therefore does not address the situation where there is only one creditor.
As regards the nature of the obligations, that is, whether or not they are linked to the business, the reasons why the obligations are not fulfilled, or whether the obligations are of a public or private nature, it must be concluded that all these factors remain irrelevant for the possibility of establishing insolvency.
As indicated above, in order to facilitate the creditor's situation, a presumption has been introduced according to which a debtor is presumed to have lost the capacity to fulfil his pecuniary obligations if the delay in the performance of the pecuniary obligations exceeds three months. However, this presumption is a rebuttable presumption. The debtor can therefore prove that he has not lost the capacity to fulfil the pecuniary obligations that have fallen due and that the non-fulfilment of the obligations is of a temporary nature.
2. The predominance of liabilities over assets (over-indebtedness)
For legal persons ( for example limited liability companies, joint-stock companies) or organizational units without legal personality, to which a separate act grants legal capacity, there is an additional, independent prerequisite for declaring bankruptcy. As mentioned above, pursuant to Article 11(2), a debtor who is a legal person or an organisational unit without legal personality, whose legal capacity is granted by a separate act, shall be deemed insolvent even if its financial obligations exceed the value of its assets and this condition persists for a period exceeding twenty-four months. However, this premise does not apply to partnerships specified in the Commercial Companies Code in which at least one partner responsible for the company's obligations without limitation is a natural person ( for example, a limited partnership in which a natural person is a general partner).
Thus, an obligated entity must not only monitor the issue of timely payment of chargeable obligations, but also monitor the relationship between the liabilities and the value of assets.
The law establishes the principles helpful in determining whether monetary liabilities exceed the value of assets.
First of all, the assets do not include components that are not part of the bankruptcy mass. As Piotr Zimmerman points out in his commentary, this applies in particular to components as obviously excluded from the mass as leased, rented or leasehold objects, but also to objects owned by other entities on the basis of, for example, the reservation of ownership rights to the seller until the full price has been paid (Prawo upadłościowe. Komentarz. Piotr Zimmerman. Wydawnictwo C.H. Beck, Warszawa 2016, komentarz do przepisu art. 11, system informacji prawnej Legalis).
Secondly, pecuniary obligations do not include future obligations, including obligations under a suspensive condition and obligations towards a partner or shareholder under a loan or other legal transaction with similar effects, as referred to in Article 342(1)(4). These obligations are treated as uncertain obligations.
Thirdly, also on the occasion of this condition, the legislator provided for a legal presumption facilitating the creditor's situation. A debtor's pecuniary obligations shall be presumed to exceed the value of his assets if, according to the balance sheet, his liabilities, excluding provisions for liabilities and liabilities to affiliated entities, exceed the value of his assets, and this condition persists for a period exceeding twenty-four months. Creditors will therefore be able, on the basis of an analysis of the balance sheet, to assess the situation as to whether there is a presumption of over-indebtedness in a particular case. However, as it follows from the above, provisions for liabilities and liabilities towards related parties will not be taken into account in the assessment of the balance of liabilities. Therefore, the legal science indicates that disputed receivables will not be taken into account, as they are included in the balance sheet as "provisions for liabilities". However, this presumption is a rebuttable presumption. A debtor may therefore point out that, taking into account whether monetary obligations exceed the value of assets, his off-balance sheet assets, for example, estimated on the basis of market prices, should also be taken into account.
Ewa Kosowska-Czapla
Polish Attorney-at-law, Licensed Receiver
In December 2021, a government IT system for handling restructuring and insolvency cases was introduced in Poland. As a rule, the court, receivers, debtors and creditors are obliged to participate in the proceedings using this system. Paper documents are to disappear. Thus, paper filings or votes will not be honoured.
Our law firm helps foreign creditors to participate in restructuring and insolvency proceedings via the IT portal so that their claims and votes are properly valid.
Pursuant to the resolution of the Supreme Court of 12 January 2022, file ref. III CZP 67/22, conclusion by a joint-stock company of a surety agreement for a debt of a spouse who remains in statutory community with a management board member of that company requires consent of the general meeting (art. 15 § 1 of the Commercial Companies Code).
In Poland, because of Covid-19, a special simplified restructuring procedure was implemented. According to the law, until 30 June 2021, an insolvent or at risk of insolvency debtor who has concluded an agreement with a restructuring advisor to supervise the course of proceedings for the approval of an arrangement may announce in the special journal Monitor Sądowy i Gospodarczy the opening of proceedings for the approval of an arrangement conducted on the basis of the provisions of the Act of 15 May 2015. - Restructuring Law.
The announcement may be made after the debtor has prepared
- arrangement proposals and
- list of claims,
- list of disputed claims
and handing them over to the arrangement supervisor.
The date of making the announcement shall be the date on which the proceedings for approval of the arrangement are opened.
As of the date of making the announcement until the date of discontinuance or termination of the proceedings for approval of the arrangement, inter alia:
1)the enforcement proceedings concerning claims specified by law initiated before the date of the opening of the proceedings shall be suspended by way of law;
2)the commencement of enforcement proceedings and the enforcement of a decision to secure a claim or an order to secure a claim arising from claims specified by law shall be prohibited.
Claims specified by law under the rules indicated therein are included in the arrangement even without the creditor's consent.
At the request of the creditor, the debtor or the supervisor of the arrangement, the court shall waive the effects of making the announcement specified by law if they lead to the harm of the creditors.
Independently of the collection of votes, according to the procedure specified by the Act - Restructuring Law, the supervisor of the arrangement may appoint a date for a creditors' meeting to vote on the arrangement. The creditors' meeting is chaired by the supervisor of the arrangement.
If there are technical possibilities, voting at the creditors' meeting may be conducted using electronic means of communication.
The proceedings to approve the arrangement shall be discontinued by force of law if no application for approval of the arrangement is submitted to the court within four months of the date of the announcement.
At the request of the debtor, creditor or any other person having a legal interest therein, the court shall issue a decision stating that the proceedings are discontinued by force of law.
From the date of making the announcement until the date of discontinuance or termination of proceedings for approval of the arrangement, the debtor may perform ordinary management activities. The consent of the supervisor of the composition agreement is required for any activities that exceed the scope of ordinary management. Consent may also be given after the activity has been performed, within thirty days from the date of its performance. An act exceeding the scope of ordinary management made without the required consent is invalid.
Another advantage of this procedure is that, under certain conditions, as a result of the timely announcement of the opening of proceedings for the approval of the arrangement, the liability of certain persons on the grounds specified in the act is excluded.
Ewa Kosowska-Czapla
Attorney-at-law
That happend for foreign clients that they receive documents from polish court for example in Germany, Sweden or another country UE.
They do not know how to behave in this situation. This case is stated in regulation (EC) No 1393/2007 of the European Parliament and of the Council of 13 November 2007 on the service in the Member States of judicial and extrajudicial documents in civil or commercial matters (service of documents), and repealing Council Regulation (EC) No 1348/2000.
In article 14 of this regulation we read „Each Member State shall be free to effect service of judicial documents directly by postal services on persons residing in another Member State by registered letter with acknowledgement of receipt or equivalent.” It means that letter from polish court is legal if it was done by postal services by registered letter with acknowledgement of receipt or equivalent. Among documents from polish court could be: claim, judgement, calling for the hearing etc.
That is why you should not ignore that letter, ever if it is in polish.
The addressee can act in two ways in this case:
- he may refuse to accept the document to be served at the time of service,
- he may returning the document to the court within one week
if it is not written in, or accompanied by a translation into, either of the following languages:
- a language which the addressee understands or
- the official language of the Member State addressed or, if there are several official languages in that Member State, the official language or one of the official languages of the place where service is to be effected.
Before the addressee decide to refuse or return the document he or she should consider if there are circumstanced which can be based to assume that he or she understand polish language. For example he or she used documents during doing business in this language, If from these circumstances the court can assume that he or she knows polish languages – this return or refusal can be treat as illegal.
Additionaly not all documentation should be translated. If we have a claim and enclosed documents – these appendix may be not translated.
After receiving documents the addressee should start action to protect his or her rights before polish court.
Ewa Kosowska-Czapla
Attorney-at-law / Restructuring Advisor
In our practice we often encounter a situation when foreign entrepreneurs conduct business activity in Poland in the form of a limited liability company.
Due to the barriers on the Polish market, in particular the language barrier, as well as numerous duties related to the activity in the home country, entrepreneurs are looking for a "manager" for their activity.
Foreign entrepreneurs want to be a member of the management board of the created Companies, in order to ensure that they are able to influence their business on an ongoing basis. Then they often appoint a proxy, who becomes the "manager" of the Company.
At the same time, a distinction should be made between the sphere of activity of a proxy as a representative of the Company, i.e. "outside", and the internal sphere, i.e. relations between the Company and the proxy.
As far as the proxy's activity as a representative of the Company is concerned, I would like to point out the following.
In principle, by virtue of the power of proxy granted, the commercial proxy may represent the Company before all entities, e.g. contractors, offices, employees in activities related to running the enterprise. Therefore, it is worth bearing in mind that all agreements concluded by a commercial proxy in the performance of business activity will be binding for the Company, regardless of whether - in the opinion of a foreign contractor - they are beneficial for the Company or not. Therefore, the Company will have to meet the obligations assumed by the commercial proxy.
In accordance with the provisions of law, the proxy must hold a special power of attorney to perform such activities as:
As far as, for example, the proxy of a limited liability company is concerned, in some situations a resolution of the shareholders will also be necessary for its important and effective operation.
According to the provision of Article 228 of the Polish Commercial Companies Code (k.s.h.), a resolution of shareholders is required, among other things:
On the other hand, the provision of art. 15 § 1 of the Polish Commercial Companies Code indicates that the conclusion by a capital company of a credit, loan, surety or other similar agreement with a proxy or on his behalf requires the consent of the general meeting of shareholders, unless the Act provides otherwise.
The proxy may also be organized in such a way as to make it impossible for the proxy to act independently by establishing a joint proxy, but only with another proxy (Article 1094 § 1 of the Civil Code). The proxy can be set also since 2016 to perform activities jointly with a member of the management board or a partner authorized to represent the partnership.
Information on whether the proxy may act jointly or independently is available in the register of entrepreneurs (provision of Article 1098 § 2 of the Civil Code).
If the company has a branch, the power of attorney may be limited to matters entered in the register of the branch.
As far as the relations between the proxy and the Company are concerned, I would like to point out the following.
At the same time, the Company should have an agreement with the proxy, in which the rules of cooperation (employment contract, managerial contract, contract of mandate) will be regulated. Some entrepreneurs stipulate in these agreements that the proxy may not conclude transactions exceeding a certain value. It is worth pointing out, however, that such reservations are not effective against three persons, but only in the internal relationship between the Company and the proxy. According to the provision of art. 1091 § 2 of the Civil Code, a commercial proxy may not be limited with effect in relation to third parties, unless a specific provision provides otherwise. Thus, only the provisions of law may decide that the proxy will not have the right of unrestricted representation.
The Proxy shall not be liable towards third parties for the Company's obligations. The Company is responsible for its obligations. In certain cases, members of the Management Board are liable. The fact that a proxy has been appointed does not release the Management Board from its duties related to the Company's operations. Therefore, the Management Board should supervise the proxy on an ongoing basis. In particular, the Management Board should take care that the proxy's actions are compliant with the law and are undertaken in the interest of the Company. The Management Board should monitor the financial situation of the Company on an ongoing basis.
If the proxy acts to the detriment of the Company, it may be necessary to immediately dismiss the proxy, terminate the agreement between the parties and pursue claims for damages against the proxy before the Court.
Ewa Kosowska-Czapla
Attorney-at-law
A wine producer within the meaning of the Polish Wine Act is:
In order to be recognised as a wine producer, not only should the wine be made or bottled but also marketed. Therefore, if we make wine for our own needs, we will not be recognized as a producer. Similarly, if we do not have our own crops. (Article 2(1)(21) of the Polish Wine Act).
Issue not legally clarified due to incoherence of concepts. An exemplary attempt to solve the problem was presented.
The regulations of the Polish Law of Entrepreneurs, and thus the necessity of entry in the CEiDG do not apply to:
They may be entered:
https://prod.ceidg.gov.pl/ceidg.cms.engine/?F;1b22de7d-916d-4591-b44d-3b8e2be61121
A farmer as defined in Article 2(a) of Council Regulation (EC) No 73/2009
"agricultural activity” means, inter alia, the production of agricultural products,
"agricultural products” means the products, with the exception of fishery products, listed in Annex I to the Treaties, as well as cotton.
The Treaty mentions:
Grape must, fermenting or with fermentation stopped otherwise than by the addition of alcohol; Wine of fresh grapes; grape must with fermentation stopped by the addition of alcohol; Other fermented beverages (e.g. cider, perry and mead).
Entry of the farmer in the register of agricultural producers
An entry in the register of producers shall be made, by way of an administrative decision, at the request of the head of the district office of the Agency for Restructuring and Modernisation of Agriculture with territorial jurisdiction, on a form drawn up and made available by the Agency.
https://www.arimr.gov.pl/dla-beneficjenta/wszystkie-wnioski/ewidencja-producentow.html
Entry in the ministerial register of 'winemakers' - regulated activities
Article 17(1) Economic activity within the scope of production or bottling of wine products is a regulated activity within the meaning of the provisions of the Act of 6 March 2018. - The Law of Entrepreneurs (Journal of Laws, item 646) and requires an entry in the Register of Entrepreneurs performing activities related to the production or bottling of wine products, hereinafter referred to as "the Register".
(2)The business activity in the field of wine products may also include bottling of wine products.
(3) The requirements for registration shall not apply to producers who exclusively make and bottle wine obtained from grapes grown in their own right.
Ministerial register
The legal basis for keeping the register is Article 20 of the Act of 12 May 2011 on the manufacture and bottling of wine products, trade in such products and organisation of the wine market (Journal of Laws of 2016, item 859, as amended), hereinafter referred to as the "Act".
Each producer and entrepreneur making wine from grapes obtained from vines located on the territory of the Republic of Poland to be marketed should be entered in the register kept by the Polish Director General of the KOWR (National Agricultural Support Centre) and submit certain documents.
http://www.kowr.gov.pl/interwencja/wino/pytania-dotyczace-rynku-wina
http://bip.stat.gov.pl/dzialalnosc-statystyki-publicznej/rejestr-regon/formularze-regon-papierowe/
https://www.biznes.gov.pl/pl/firma/sprawy-urzedowe/chce-dostac-pozwolenie-na-sprzedaz-alkoholu/proc_280 - permit for sale of alcohol
https://www.biznes.gov.pl/pl/firma/zezwolenia-koncesje-wpisy-do-rejestru/chce-uzyskac-zezwolenie-koncesje-wpis-do-rejestru-dzialalnosci-regulowanej54/proc_214-Wholesale/License for Wholesale Alcohols
https://ijhars.gov.pl/certyfikacja-wina.html3.
https://www.biznes.gov.pl/pl/firma/sprzedaz-i-marketing/chce-wprowadzic-produkt-usluge-na-rynek/proc_520-entry-enterprise-do-register-sanepid
https://www.biznes.gov.pl/pl/firma/sprzedaz-i-marketing/chce-wprowadzic-produkt-usluge-na-rynek/proc_521- approval-plant-i-entry-do-register-sanepid register
I invite you to get acquainted with the above material in the form of a film: https://www.youtube.com/watch?v=Vljogovulo
Ewa Kosowska- Czapla
Attorney-at-law/ Restructuring adviser
The concept of insolvency in Polish law has significant legal consequences. Insolvency is closely related to the necessity of filing a petition for bankruptcy by the obliged and determines the declaration of bankruptcy by the court. There are also serious consequences for certain entities related to the lack of timely filing of a bankruptcy petition.
Thus, each entrepreneur should monitor the condition of his company on an ongoing basis in order to respond to the state of insolvency in a timely and appropriate manner. Recently, as a result of the amendment to the bankruptcy and reorganisation law, which entered into force on 1 January 2016, the provisions on insolvency have changed quite significantly.
Bankruptcy is declared against a debtor who has become insolvent (Article 10 of the Polish Insolvency Law). Therefore the state of insolvency is a state which obliges the entrepreneur to file for bankruptcy. Pursuant to Article 21(1) of the Polish Insolvency Law, the debtor is obliged, not later than within thirty days from the date on which the basis for declaring bankruptcy occurred, to file a motion for declaring bankruptcy to the court.
Pursuant to Article 11(1) of the Polish Insolvency Law, a debtor is insolvent if he has lost the ability to fulfil his chargeable pecuniary obligations. A presumption has been introduced according to which the debtor is presumed to have lost the capacity to perform his chargeable pecuniary obligations if the delay in the performance of the pecuniary obligations exceeds three months.
Pursuant to Article 11(2), a debtor who is a legal person or an organisational unit without legal personality, to which a separate act grants legal capacity, shall also be insolvent if its pecuniary obligations exceed the value of its assets and this state of affairs persists for a period exceeding twenty-four months.
The first criteria that apply to all debtors is the loss of the debtor's ability to fulfil its chargeable pecuniary obligations.
It is worth noting that insolvency relates only to pecuniary obligations. Therefore, as Piotr Zimmerman points out in his commentary, "A debtor who fails to perform obligations of a non-pecuniary nature on time is not insolvent until such obligations become pecuniary by contract or action of the creditor, even if he is in delay in performing them for more than 3 months". (Prawo upadłościowe. Komentarz. Piotr Zimmerman. Wydawnictwo C.H. Beck, Warszawa 2016, komentarz do przepisu art. 11, system informacji prawnej Legalis).
Monetary liabilities must be chargeable. As pointed out by the Supreme Court in the judgment of 22 March 2001, V CKN 769/00 "In doctrine and judicature, the chargeability of a debt is defined as the state in which the creditor has the legal possibility to demand satisfaction of his debt to which the creditor is entitled. This is a potential, objective state, whose beginning coincides with the activation of the debt ( see the justification of the Supreme Court's judgment of 12 February 1991, III CRN 500/90, OSNCP 1992, no. 7-8, item 137). The beginning of due date cannot be summarised as a single rule applicable to all legal relations, as it depends on the nature of the obligations and their properties. Only chargeability in relation to obligations of a timely nature is uniformly recorded. It is then assumed that the claim is due if the deadline for performance has come, as from that date the creditor may demand fulfilment of the performance that the debtor has to fulfil. The issue of maturities in respect of indefinite obligations is different (...). In this case, it is not acceptable to adopt a position identifying the due dates and performance, since Article 455 of Kodeks Postępowania Cywilnego (the Polish Civil Code), which defines the date of performance as "immediate" after being called by the creditor". According to the above, monetary obligations become chargeable on the date set as the payment date, provided that this date has been set correctly. On the other hand, indefinite pecuniary obligations become chargeable immediately after the creditor has been called upon to fulfil them. For example, when the debtor is unable, despite being due, to meet its obligations, it should consider filing a petition for bankruptcy. Entrepreneurs or members of the Management Board of the Company should be aware of the current financial condition of the Company, and thus the possibility of satisfying the debts.
A practical problem in determining the loss of ability to fulfil chargeable obligations is whether there must be more than one creditor unsatisfied. The literature assumes that there must be at least two creditors. Polish Insolvency law is intended to establish joint enforcement by creditors (Article 1(1) of the Polish Insolvency Law) and therefore does not address the situation where there is only one creditor.
As regards the nature of the obligations, that is, whether or not they are linked to the business, the reasons why the obligations are not fulfilled, or whether the obligations are of a public or private nature, it must be concluded that all these factors remain irrelevant for the possibility of establishing insolvency.
As indicated above, in order to facilitate the creditor's situation, a presumption has been introduced according to which a debtor is presumed to have lost the capacity to fulfil his pecuniary obligations if the delay in the performance of the pecuniary obligations exceeds three months. However, this presumption is a rebuttable presumption. The debtor can therefore prove that he has not lost the capacity to fulfil the pecuniary obligations that have fallen due and that the non-fulfilment of the obligations is of a temporary nature.
2. The predominance of liabilities over assets (over-indebtedness)
For legal persons ( for example limited liability companies, joint-stock companies) or organizational units without legal personality, to which a separate act grants legal capacity, there is an additional, independent prerequisite for declaring bankruptcy. As mentioned above, pursuant to Article 11(2), a debtor who is a legal person or an organisational unit without legal personality, whose legal capacity is granted by a separate act, shall be deemed insolvent even if its financial obligations exceed the value of its assets and this condition persists for a period exceeding twenty-four months. However, this premise does not apply to partnerships specified in the Commercial Companies Code in which at least one partner responsible for the company's obligations without limitation is a natural person ( for example, a limited partnership in which a natural person is a general partner).
Thus, an obligated entity must not only monitor the issue of timely payment of chargeable obligations, but also monitor the relationship between the liabilities and the value of assets.
The law establishes the principles helpful in determining whether monetary liabilities exceed the value of assets.
First of all, the assets do not include components that are not part of the bankruptcy mass. As Piotr Zimmerman points out in his commentary, this applies in particular to components as obviously excluded from the mass as leased, rented or leasehold objects, but also to objects owned by other entities on the basis of, for example, the reservation of ownership rights to the seller until the full price has been paid (Prawo upadłościowe. Komentarz. Piotr Zimmerman. Wydawnictwo C.H. Beck, Warszawa 2016, komentarz do przepisu art. 11, system informacji prawnej Legalis).
Secondly, pecuniary obligations do not include future obligations, including obligations under a suspensive condition and obligations towards a partner or shareholder under a loan or other legal transaction with similar effects, as referred to in Article 342(1)(4). These obligations are treated as uncertain obligations.
Thirdly, also on the occasion of this condition, the legislator provided for a legal presumption facilitating the creditor's situation. A debtor's pecuniary obligations shall be presumed to exceed the value of his assets if, according to the balance sheet, his liabilities, excluding provisions for liabilities and liabilities to affiliated entities, exceed the value of his assets, and this condition persists for a period exceeding twenty-four months. Creditors will therefore be able, on the basis of an analysis of the balance sheet, to assess the situation as to whether there is a presumption of over-indebtedness in a particular case. However, as it follows from the above, provisions for liabilities and liabilities towards related parties will not be taken into account in the assessment of the balance of liabilities. Therefore, the legal science indicates that disputed receivables will not be taken into account, as they are included in the balance sheet as "provisions for liabilities". However, this presumption is a rebuttable presumption. A debtor may therefore point out that, taking into account whether monetary obligations exceed the value of assets, his off-balance sheet assets, for example, estimated on the basis of market prices, should also be taken into account.
Ewa Kosowska-Czapla
Polish Attorney-at-law, Licensed Receiver