A French industrial group preparing to enter the Polish market faces an immediate structural decision: register a branch (oddział) or incorporate a subsidiary (spółka z ograniczoną odpowiedzialnością, sp. z o.o.). The choice shapes tax exposure, liability, and operational speed for years. Getting it wrong at the outset is difficult to reverse without cost and delay.

A branch in Poland is a legally dependent extension of the French parent, with no separate legal personality. A subsidiary – typically an sp. z o.o. – is a distinct Polish legal entity registered in the National Court Register (Krajowy Rejestr Sądowy, KRS). The core difference is liability: the parent bears unlimited exposure through a branch, while a subsidiary ring-fences that risk. Registration of either form requires filing with the KRS, but timelines and document requirements differ significantly.

This alert explains the practical differences between the two structures, identifies which French groups are most affected by the choice, and sets out the immediate steps each path requires. We also flag where the rules have tightened and where the cost of delay is highest.

What are the structural differences that matter for French groups?

The branch carries no independent legal personality. It acts in the name of the French parent, which remains directly liable for all obligations the branch incurs in Poland. The branch must appoint a representative (przedstawiciel) resident in Poland and register with the KRS. The process typically takes four to six weeks from submission of a complete file. The branch can only conduct activities that mirror the parent's statutory scope – a restriction that frequently surprises French groups with diversified operations.

The sp. z o.o. is Poland's workhorse corporate vehicle. Minimum share capital is PLN 5,000. It has its own legal personality, can sue and be sued, and can pursue any lawful business activity. Incorporation through the standard KRS route takes three to five weeks; the S24 online procedure can reduce this to under two weeks for straightforward structures. The Polish Financial Supervision Authority (Komisja Nadzoru Finansowego, KNF) oversight applies only where regulated activities – financial services, insurance – are involved.

Tax treatment diverges sharply. A branch's profits are attributed directly to the French parent and taxed in Poland under the Polish-French double tax treaty. An sp. z o.o. pays Polish corporate income tax (CIT) at 19 percent, or 9 percent for small taxpayers below the EUR 2m revenue threshold. French groups subject to Pillar Two rules should model both scenarios before filing, since the effective rate differential can affect top-up tax calculations at group level.

  • Branch: unlimited parent liability, restricted activity scope, no minimum capital
  • Sp. z o.o.: ring-fenced liability, flexible scope, PLN 5,000 minimum capital
  • Branch registration: four to six weeks; sp. z o.o. standard: three to five weeks
  • CIT rate for sp. z o.o.: 19 percent standard, 9 percent small-taxpayer rate

For a comparison of sp. z o.o. against the joint-stock company (spółka akcyjna, SA) structure – relevant where a French group anticipates a future Polish public offering or bond issuance – see our decision matrix for UK investors, which addresses the same structural logic.

Who is most affected and what action is required now?

Three categories of French groups face the sharpest decision pressure. First, groups entering Poland to perform a single, time-limited contract – construction, consulting, project delivery – often default to a branch for speed and simplicity. That logic holds only if the contract duration is under 12 months. Beyond that threshold, the branch risks creating a permanent establishment (PE) under the treaty, triggering Polish CIT on attributable profits with potential back-assessments reaching three to five years.

We secured a reversal of a PE-related tax surcharge exceeding PLN 1.8m for a French engineering client in the Mazowieckie region (autumn 2025). The exposure arose from a branch that had operated for 14 months without a PE analysis. Early restructuring into an sp. z o.o. would have eliminated the risk entirely.

Second, French groups planning acquisitions in Poland – whether asset deals or share purchases – should complete due diligence on the target's KRS history before deciding on post-acquisition structure. A target with legacy branch liabilities requires a different integration approach than a clean sp. z o.o. Our team obtained interim measures protecting assets worth over EUR 3m for a French investor's acquisition vehicle in Lower Silesia (winter 2025), where undisclosed branch obligations threatened deal completion.

Third, groups already operating a Polish branch and now expanding scope or revenue should review their structure within 30 days. The KRS registration of an sp. z o.o. to replace or sit alongside a branch requires careful sequencing to avoid gaps in contractual continuity. French groups acquiring Polish real estate through their Polish vehicle should also consult our guide for France nationals buying property in Poland before finalising the holding structure.

What to prepare before approaching the KRS:

  • Apostilled extract from the French commercial register (Registre du Commerce et des Sociétés), translated into Polish
  • Notarised resolution of the parent's governing body authorising the Polish presence
  • Identity documents and Polish address for the designated representative or management board member
  • Draft articles of association for sp. z o.o. (or branch deed), reviewed against Polish KSH requirements

For Ukrainian-owned or CIS-owned groups entering Poland alongside French co-investors, the structural considerations overlap but diverge on beneficial ownership disclosure. The sp. z o.o. vs SA matrix for Ukraine investors addresses those specifics.

The immediate action item is simple: do not file with the KRS before completing a 30-minute structural analysis. The filing itself is irreversible in the short term – converting a branch to a subsidiary mid-contract creates tax and contractual complications that a brief pre-filing review would have avoided.

Your specific situation determines which structure protects the group and which exposes it. Choosing the wrong vehicle at entry forfeits tax efficiency and creates personal liability risk for the parent's directors under Polish corporate legislation.

To receive an expert assessment of your group's Polish entry structure, contact info@kordeckipartners.com.

Frequently asked questions

Q: Can a French group operate in Poland through a branch indefinitely without incorporating a subsidiary?

A: Yes, legally – there is no mandatory conversion deadline. However, a branch operating beyond 12 months risks creating a permanent establishment under the Polish-French double tax treaty, which triggers Polish CIT on attributable profits. Groups with growing Polish revenues should reassess the branch structure annually.

Q: How long does it take to register an sp. z o.o. for a French parent company?

A: Standard KRS registration takes three to five weeks from submission of a complete file. The S24 online procedure can reduce this to under two weeks, but is only available where the articles of association use the standard statutory template without customisation. Apostille and translation of French documents typically add one to two weeks to preparation time.

Q: Is the 9 percent reduced CIT rate available to a Polish subsidiary of a French group?

A: The 9 percent small-taxpayer CIT rate applies to an sp. z o.o. whose annual revenue does not exceed EUR 2m. Newly incorporated subsidiaries may qualify in their first full tax year. However, Polish tax law excludes entities formed through a contribution of an existing enterprise or organised part thereof – a structure sometimes used in M&A transactions. Due diligence on eligibility is advisable before relying on the reduced rate.

KORDECKI & Partners is a law firm based in Warsaw and Krakow, advising business clients across 30 jurisdictions. Our team combines expertise in Polish and international law with a practical approach to corporate structuring, M&A transactions, and market entry for foreign investors. We work with Polish entrepreneurs, foreign investors, and in-house legal teams. To discuss your situation, contact info@kordeckipartners.com.

Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. KORDECKI & Partners assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@kordeckipartners.com.