The internationalisation of transactional agreements and borrowings from the common law
Along with the systemic transformation from the 1980s to 1990s and the inflow of foreign investment into Poland, the country was exposed to forms of contract already applied in international trade. It wasn’t that before then the law in Poland had been homogeneous and “truly Polish.” Historically, numerous factors contributed to the development of the Polish legal system, with a dominant role played by solutions from the German and French systems.
Resolutions of shareholders of a limited-liability company
When is it necessary to hold a shareholders’ meeting, and when can it be dispensed with? Comments under the amended provisions of the Commercial Companies Code
Approvals: Legal limitations on conducting transactions in Poland
The condition of the Polish M&A market depends on many factors, such as the economic and political situation in the country and the legal and tax environment for businesses. But another significant element impacting the size and structure of investments in Poland is the legal restrictions on conducting transactions. They affect both share deals and asset deals.
Will there be more transactions on the pharmacy market?
There have been few transactions on the pharmacy market in Poland since 25 June 2017, when the amendment to the Pharmaceutical Law popularly known as “Pharmacies for Pharmacists” entered into force. The transactions that did occur carried significant regulatory risk. This situation may change due to a recent interpretation by the Ministry of Health. Will we witness a gradual departure from the restrictive limitations under the 2017 amendment?
Legal actions of a “false” corporate body can be saved. But all of them?
On 1 March 2019, an important amendment to the Civil Code comes into force, providing for the possibility of validating actions by a “false” corporate body. Up to now, such a possibility has applied only to actions by a “false” attorney-in-fact.
Powers, duties and liability of directors of a Polish LLC
Foreign managers appointed to serve on boards of Polish subsidiaries often do not know what they can do and what they must do. Consequently they are not aware of what liability goes with either of these. They should be.
How business lawyers create value?
In the context of an M&A transaction a business lawyer is often perceived as necessary evil, a hardly justified cost. Even experienced market operators, when reflecting on how counsels contribute to their deals, seem to only focus on the most obvious, technical aspects of our job. “We have to engage and pay lawyers because they know the exact words that need to be put to paper for things or money to change hands and for us to be able to seek recourse” their reasoning seems to go. In more extreme cases clients are certain that lawyers, by definition, always impair the prospects of their enterprise.
Closing date of an M&A transaction and the right to participate in the general meeting of a non-public joint-stock company
The Commercial Companies Code regulates in detail the rules for shareholders’ participation in the general meeting of a joint-stock company. The resulting legal conditions should be taken into account when planning the timeframe for M&A transactions to adequately secure the rights of the buyer of shares, and in particular, the possibility for the buyer to participate in the general meeting of a non-public joint-stock company after the closing of the transaction.
Transfer of ownership of bearer shares and obligation to deliver shares
According to the applicable regulations, in order to transfer the ownership of shares, it is necessary to have a tangible element in the form of transfer of possession of registered shares or delivery of bearer shares. The transfer of ownership of registered shares additionally requires the conclusion of an agreement between the seller and the buyer (either on the share document itself or in a separate document), while the transfer of bearer shares may take place even without the conclusion of a formal agreement, through the mere delivery of the shares. Considering the significant legal consequences of delivering a bearer instrument, it is necessary to consider how to understand the term “delivery of shares”.
The good and the bad sides of representations and warranties – a few practical observations
Representations and warranties are a common feature in M&A transactions and derive from common law systems. The fundamental aim of representations and warranties is to properly divide risk between the seller and the buyer. In countries with an Anglo-Saxon legal system, statements made regarding the object of sale are in fact explicitly an element of ex delicto liability, as misrepresentation, and contractual liability as breach of warranty. The significance of statements of this kind in contracts governed by Polish law is not entirely clear and has been widely discussed in case law and legal literature. The conclusions reached are summarised below.
Guarantee agreements in Supreme Court jurisprudence
A guarantee agreement is the most widely accepted and common basis for a number of solutions used in M&A transactions. Therefore, its correct application is of fundamental importance for this practice. Meanwhile, judgments issued in recent years by the Supreme Court of Poland on the nature and normative sources of such obligations have caused doctrinal controversies and uncertainty among trade participants. It is therefore worth briefly summarising where the case law stands and the conclusions that can be drawn from it.
Strengthening financial market supervision
Recent difficult investor experiences have led to proposals for further regulatory changes aimed at increasing security and strengthening supervision of the financial market. Currently in a Sejm committee, a government bill is being read for the first time which would amend several acts, redefine the Polish Financial Supervision Authority, and impose an obligation to dematerialise some financial instruments.
