Investment and commercial law MEMBER OF THE MANAGEMENT BOARD IN POLAND – APPOINTMENT, REPRESENTATION, LIABILITY

The management board in Poland is the basic body managing the affairs of a capital company – both a limited liability company (sp. z o.o.) and a joint-stock company (S.A.). One or more natural persons with full legal capacity are appointed to the management board.

Who appoints a member of the management board?

• in a limited liability company (sp. z o.o.) – generally, the shareholders in a resolution of the shareholders' meeting, unless the articles of association provide for a different solution (e.g., appointment by the supervisory board),

• in a joint-stock company (S.A.) – as a rule, the supervisory board, unless the company's articles of association provide otherwise.

The term of office of a member of the management board in a joint-stock company (S.A.) is generally 5 years. In a limited liability company (sp. z o.o.), the term of office is generally one year, although the articles of association may regulate this issue differently.

Appointment to the management board is not tantamount to employment – it is necessary to determine whether a member of the management board will perform their duties solely on the basis of the act of appointment or on the basis of an additional agreement (e.g., a management contract, an employment contract).

Representation of the company by the management board

The management board manages the company's affairs and represents it externally. The rules of representation depend on the number of members of the management board:

• in the case of a single-member management board – the company is represented independently by the sole member of the management board,

• in the case of a multi-member management board, the manner of representation is specified in the articles of association/statutes; most often, the cooperation of two members of the management board or a member of the management board together with a procuration holder is required.

It is worth noting that the manner of representation disclosed in the National Court Register (KRS) is binding on third parties. A change in the rules of representation requires not only an appropriate resolution, but also notification and entry in the KRS.

Liability of a member of the management board

Serving on the management board entails broad liability – both towards the company and towards creditors or state authorities:

• liability towards the company – members of the management board are liable for damage caused to the company by actions contrary to the law or the articles of association/statutes, unless they are not at fault; these rules apply to both limited liability companies (sp. z o.o.) and joint-stock companies (S.A.),

• liability towards creditors – liability for the obligations of a limited liability company is particularly important; if enforcement against the company proves ineffective, members of the management board may be held liable with all their assets. A member of the management board may be released from this liability if they prove, among other things, that a petition for the company's bankruptcy was filed on time,

• public law liability – members of the management board are also liable for the company's tax liabilities – in accordance with the rules laid down in the Polish Tax Ordinance. Liability for social security contributions (ZUS) is also possible,

• criminal and fiscal liability – in certain cases, members of the management board may also be liable under criminal and fiscal law, e.g., for accounting violations.

Summary

In Poland, a member of the management board plays a key role in the functioning of a capital company – they are not only responsible for managing its affairs and representing it, but also bear far-reaching legal responsibility. Therefore, both persons appointed to the management board and shareholders should be aware of the legal consequences associated with this function. Professional legal support allows you to reduce risks and ensure the security of your business.