Poland will have a new legal structure for business

Polish government has plans to introduce a new legal structure for companies. The new type of business entity will be created with start-ups in mind.

Construction of a special type of legal entity was included in the much talked about initiative of the Ministry of Development, The Plan for Responsible Development, known as “the Morawiecki Plan” (Mateusz Morawiecki is Polish Minister of Development).

Experts realise there is a need to introduce new legal provisions that will be appropriate for start-up companies. Currently, start-ups choose between the structure of spółka z ograniczoną odpowiedzialnością (limited liability company) and spółka akcyjna (joint-stock company). Yet, present-day regulations are anachronous and do not fit the bill.

Young entrepreneurs note that companies working in the field of technology and internet need special treatment from the government. Provisions of the Civil Code are too general, difficult to pore through, and lack solutions that are present in other countries.

That is why ministry officials are working on new legal provisions that are to change the current situation and make turning business ideas into reality much easier.

The new business structure is to have low minimum capital threshold, involve as little formalities as possible, and make do without a supervisory board. The new act will introduce concepts not currently present in Polish legislation, such as “vesting” or „convertible note”.

The works are currently in the consultations phase. The Ministry is closely cooperating with StartUp Poland Foundation representing the start-up community in Poland. The organization see the need for such initiatives as tax credits for business angels or introduction of modern investment mechanisms.

An online survey was created, through which young entrepreneurs can express their ideas for the new legal form and specify the difficulties they run into when setting up a business or trying to find investors.

The Ministry of Development wants to boost innovativeness. Introduction of the new legal structure is part of the “Start in Poland” strategy that is to accelerate start-up growth in Poland.

The strategy also involves a funding programme, support for investors and backing in all development phases. Polish businesses will be encouraged to invest in start-ups.

The new type of entity is to become available in the second half of 2016. As for now, the structure does not have an official name. The name will be chosen in an online poll. The option most likely to win is “prosta spółka akcyjna” (simple joint-stock company).