On 12 April, a bill amending the Commercial Companies Code[1]was published in the Polish Journal of Laws. The bill includes rules applicable for activities of holding companies, instruments strengthening the role of supervisory boards as well assimplifying the process of management of capital groups.

The growth of the Polish market results in an increased focus of foreign entities wishing to operate in Poland. Legislation intended to gradually introduce measures facilitating business operations, providing an appropriate level of protection, needs to be counterbalanced by a gradually expanding range of regulatory instruments available.

To this end, innovative in terms of the Polish legal system solutions have been introduced, such as the Business Judgement Rule. Under the amendment, managing body members will not breach their duty of due diligence if they act in a manner loyal towards the company, within the limits of reasonable commercial risk based on information that should be taken into account when making a careful judgement.

The project envisages are also important changes strengthening the position of the supervisory board in relation to other company’s bodies. Novelties introduced under the amendment include an obligation for the management board to submit certain information to the supervisory board, the right to appoint a supervisory board advisor without involving the management board, or the requirement to obtain supervisory board consent, for instance to a transaction of high value with a company within the group. A supervisory board in a holding company has been given the power of permanent oversight of subsidiaries’ activities furthering the group’s interests. The body’s powers have been increased so that it is treated as an equal partner to the management board.

These solutions could make the operations of holding groups active in Poland more transparent. If exercised properly, these new powers could strengthen the position of supervisory bodies and simplify management at the same time.

A vacatio legis for the changes is six months and thus they will not take effect until 13 October 2022.

[1] The government bill amending the Commercial Companies Code and certain other acts, IX parliamentary session, docket 1515.