Set up a startup in Poland in a legal Perspective. Relocating the company abroad (to EU member or USA)

1. DR PATRYK FILIPIAK
ATTORNEY-AT-LAW

2. SetUpYour StartUp

3. A Model Case:
• 1 or more founders having an idea for
business (Founders)
• 1-2 IT associates (IT)
• Business model based on new technologies
(mostly internet, mobile apps etc.)
• First round of Financing (seed/startup)
SetUpYour StartUp

4. Seed Phase:
• Self-employment for one Founder
• Civil Partnership for more than one Founder
SetUpYour StartUp

5. Self – Employment (Private Enterprise):
PROS:
• Central Record and Information about Economic
Activity (CEIDG)
• Cheap and easy to setup and manage
CONS:
• No limited liability
• Tax – Personal Income Tax (PIT) flat (19%) or
progressive (18% and 32%)
SetUpYour StartUp

6. Civil Partnership (CLP):
• Agreement not an entity
• CLP is not a separate entrepreneur (partners
are!)
SetUpYour StartUp

7. CLP – Estate:
• Assets belong to partners – joint estate
• Joint estate is separated form personal
estates of partners
• Joint estate – special legal regime
SetUpYour StartUp

8. CLP – Managing:
• Generally management and representation
belong to all partners (no corporate bodies)
• Rules may be altered in Partnership
Agreement
SetUpYour StartUp

9. CLP – Liability:
• Partners are liable for debts toward 3rd
Parties
• Joint liability
• Right of recourse
• Can’t be altered in Partnership Agreement
SetUpYour StartUp

10. CLP – Taxation:
• CLP – no legal capacity in tax law apart from
VAT
• PIT – on Partners’ level
• Simplified accountancy
SetUpYour StartUp

11. SetUpYour StartUp

12. SetUpYour StartUp
Typical solution:
• Limited Liability Company – „Ltd.” (spółka z
ograniczoną odpowiedzialnością)
Special corporate vehicles:
• Limited Liability Company Limited Partnership - „sp. z
o.o. sp.kom.” (spółka z ograniczoną
odpowiedzialnością spółka komandytowa)
• Limited Liability Company Limited Joint- Stock
Partnership – „sp. z o.o. SKA” (spółka z ograniczoną
odpowiedzialnością spółka komandytowo-akcyjna)

13. SetUpYour StartUp
LTD. – Estate:
• As a legal entity it has its own estate
• Fully separated from shareholders’ estates
• Minimum share capital: 5.000 PLN
• Estate comes generally from:
 Shareholders’ contributions (cash or
contribution in kind)
 Economic activity

14. SetUpYour StartUp
LTD. – Managing:
Ltd. is managed by:
• Board of Directors, Management Board
(usually Founders) – manages and
represents Ltd. on daily basis
• Shareholders’ Meeting – makes most
important or strategic decisions
• Supervisory Board (generally optional) –
supervise actions of Board of Directors

15. SetUpYour StartUp
LTD. – Liability:
• Corporate Veil
• Liability of members of the Board of
Directors:
 In case of bankruptcy toward 3rd parties
 For unlawfull actions toward Ltd.

16. SetUpYour StartUp
LTD. – Taxes:
• Double taxation (CIT & PIT):
 Company level (Company Income Tax –
19%)
 Shareholders level (Personal Income Tax
– 19%)

17. SetUpYour StartUp
Special Vehicles:
• Advantages:
combining corporate veil and singular
taxation
• Problem:
upcomming legislation changes

18. Thank you!
Dr Patryk Filipiak
Attorney-At-Law
p.filipiak@filipiakbabicz.com
IŁŁAKOWICZÓWNY 7/2
60-789 POZNAŃ
T: + 48 61 2224 383
E: office@filipiakbabicz.com
WWW.FILIPIAKBABICZ.COM

19. DR PATRYK FILIPIAK
ATTORNEY-AT-LAW

20. SetUpYour StartUp

21. SetUpYour StartUp
Ways to achieve the goal:
• The decision on relocating the
company’s seat abroad under Polish
law
• Share deal
• Asset deal
• Cross-border mergers

22. SetUpYour StartUp
Ways to achieve the goal:
• The decision on relocating the
company’s seat abroad under Polish
law
• Share deal
• Asset deal
• Cross-border mergers

23. SetUpYour StartUp
• The decision on relocating the
company’s seat abroad under Polish
law
• What about EU Law?

24. SetUpYour StartUp
Asset Deal:
• The direct transfer of individual assets,
i.e. real estate, machinery, receivables,
etc. (the "asset deal")
• Key issues of the asset deal transaction

25. SetUpYour StartUp
Share Deal:
• In case of legal entities it is also
possible to acquire all majority of
shares (the "share deal")
• Key issues of the share deal
transaction

26. SetUpYour StartUp
EU Cross-Border Merger:
• Companies and limited joint-stock
partnerships may conduct a cross
border mergers in EU
• Important: the condition is that at
least two are subject to the laws of
different Member States

27. Thank you!
Dr Patryk Filipiak
Attorney-At-Law
p.filipiak@filipiakbabicz.com
IŁŁAKOWICZÓWNY 7/2
60-789 POZNAŃ
T: + 48 61 2224 383
E: office@filipiakbabicz.com
WWW.FILIPIAKBABICZ.COM