Directors’ Duties in Poland

>> Liabilities and Penalties in Poland

Exercise your responsibilities carefully as the penalties for failure to do so can be severe.

The civil and criminal penalties imposed against management board members for not properly performing their duties are severe. You can be held jointly and severally liable for a multitude of offences under both civil and criminal law, some of the most common have been listed below.

With regards to criminal liabilities, the following breaches are examples of the type of liabilities you may incur:

  • false information – management board members are jointly and severally liable with the company towards creditors for a period of 3 years from the date of the company’s (i) initial registration date or (ii) registration date of an increase of initial share capital, for giving false information in a statement on the initial capital of the company or any increase of such capital, whether intentionally or through negligence
  • damage inflicted through an act or omission – management board members are liable to the company for damage inflicted by an act or omission resulting in a breach of law and/or the company’s articles of association

Criminal liabilities

With regards to criminal liabilities, the following breaches are examples of the type of liabilities you may incur:

  • failure to make bankruptcy filings – A management board member who does

not make a bankruptcy filing, despite the existence of conditions creating an obligation to make such a filing, may be subject to a fine, probation or imprisonment for up to 1 year.

  • false information – A management board member who announces untrue information or presents such information to the company’s bodies, state authorities or auditor, may be subject to:
    • a fine, probation or imprisonment for up to

2 years; or

  • a fine, a probation or imprisonment for up to 1 year, if such the acts are deemed to have been unintentional
  • a management board member may be fined up to PLN 20,000 if he/she:
    • fails to submit an up-to-date list of the shareholders of the company to the Registry Court
    • fails to keep a book of shares
    • fails to convene a shareholders meeting when required
    • fails to provide explanations to an auditor or prevents such person from discharging his/ her duties
    • fails to file an application to the Registry Court for the appointment of an expert auditor when required
    • as applicable, allows the company to operate without a supervisory board of an appropriate composition for a period longer than three months
  • a management board member may be imprisoned for 3 months to 5 years if he/she causes substantial financial damage to the company due to an abuse of authorisation granted or failure to perform a duty

If the action against the company proves ineffective, management board members are jointly and severally liable for the company’s liabilities. They may be discharged from the abovementioned liability if they prove that:

  • the petition in bankruptcy was timely filed or arrangement proceedings were initiated
  • that a failure to file the petition in bankruptcy, or a failure to initiate arrangement proceedings occurred through no fault on their part
  • that despite the failure to file the petition or initiate arrangement proceedings the creditor suffered no damage

The above shall not prejudice the provisions whereby further liability of members of the management board is envisaged.

Either the breach of duty itself, or the imposition of one of the sanctions described above, may lead to disciplinary action being taken against you and/ or limitations upon you being able to continue in your role.

Limitation of liability

It is possible to limit the liability of the

management board members for damage caused to the company due to non-performance or improper performance of duties associated with the exercise of their duties to a specified amount. However, it is not a common practise in Poland.

The above-mentioned limitation of liability has the effect that the company, in the event of incurring losses resulting from dishonest executive management could not, in principle, demand that the management board member pay compensation in an amount higher the agreed limitation amount.

In addition this limitation does not influence  the right of a third party to claim damages from the management board members in cases when the company does not have funds to satisfy  the creditor.

Delegation of authorities

Subject to any restriction in the company’s Articles of Association, you may delegate your powers to any person, subject to legislative restriction. The formal management board’s representative may be appointed as a commercial proxy and should be registered in the National Court Register. Please note that regular powers of attorney do not require any registration.

Directors and officers (“D&O”) insurance

Directors can obtain D&O liability insurance and it is becoming increasingly popular to do so. It is a relatively new prospect in Poland and therefore is still developing.

It is generally the company that will take out the insurance on behalf of its officers, however, they may obtain it directly.

Latest version updated 4th April 2018

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Polish Z?oty


$ 469.5