A foreign parent company assumes that its Polish subsidiary runs itself. The local management board files annual reports, holds shareholder meetings, and keeps the National Court Register (KRS) up to date. Then an audit or a sale process begins – and the gaps appear. Missing resolutions, undocumented related-party transactions, and a supervisory board that never formally convened. The cost of fixing these issues under time pressure is always higher than preventing them.
Polish corporate governance for subsidiaries is governed primarily by the Kodeks spółek handlowych (Commercial Companies Code, KSH), which imposes mandatory obligations on both the management board and the shareholders' meeting. Foreign parent companies are directly affected because KSH liability rules reach through the subsidiary structure to decisions made at group level. Non-compliance does not merely create administrative risk – it can trigger personal liability of board members and invalidate resolutions passed without proper procedure.
This alert covers three areas: what the current governance framework requires, which thresholds determine when additional obligations apply, and what parent companies should do within the next 30 days to close the most common gaps.
What does Polish corporate law require from subsidiary boards?
The management board of a Polish spółka z ograniczoną odpowiedzialnością (limited liability company, sp. z o.o.) is the primary governance body. It acts collectively, represents the company before third parties, and bears statutory responsibility for the accuracy of financial statements filed with the National Court Register (KRS). Each board member is personally liable for obligations the company cannot meet if the board fails to file for insolvency within 30 days of the company becoming insolvent.
Three obligations catch foreign-owned subsidiaries most often. First, the annual ordinary shareholders' meeting must be held within six months of the financial year-end – for calendar-year companies, that is 30 June. Second, any transaction between the subsidiary and its parent, or with another group entity, must be documented with a resolution if the value exceeds thresholds set in the articles of association or the KSH. Third, changes to the management board must be registered with the KRS within seven days of the resolution date.
The Polish Financial Supervision Authority (KNF) becomes relevant when the subsidiary operates in a regulated sector – banking, insurance, or investment services. In those cases, fit-and-proper requirements for board members are assessed by the KNF directly, adding a parallel approval layer on top of KSH obligations.
We identified missing ordinary shareholders' meeting resolutions for a manufacturing client in the Mazowieckie region (autumn 2025). The gap covered three consecutive years and required a retroactive documentation exercise before the client could proceed with a refinancing. The process added six weeks to the transaction timeline.
Which thresholds trigger enhanced governance obligations?
Not every subsidiary faces the same compliance burden. KSH and related legislation apply differentiated requirements based on company size, ownership structure, and sector. Knowing which thresholds your subsidiary crosses determines the immediate action list.
Size thresholds matter in two ways. A subsidiary that qualifies as a large undertaking under Polish accounting law – exceeding two of three criteria: total assets above PLN 85m, net revenues above PLN 170m, or average headcount above 250 – must have its financial statements audited by a statutory auditor registered with the Polish Agency for Audit Supervision (PANA). The audit report must be filed with the KRS within 15 days of approval by the shareholders' meeting.
- Ordinary shareholders' meeting: within 6 months of financial year-end
- KRS registration of board changes: within 7 days of resolution
- Audit filing with KRS: within 15 days of shareholders' meeting approval
- Insolvency filing deadline: within 30 days of insolvency trigger
- Related-party transaction documentation: before execution, not after
Ownership concentration creates a separate layer. When a single shareholder holds 100 percent of shares – a common structure for wholly-owned subsidiaries – certain KSH provisions on conflicts of interest apply with particular force. Any legal act between the sole shareholder and the company must be made in writing under pain of invalidity. This rule is frequently overlooked in intra-group service agreements and cash-pooling arrangements.
For subsidiaries with a supervisory board (rada nadzorcza), the KSH requires at least three members and a minimum of one meeting per financial quarter. Parent companies that appoint supervisory board members but never schedule meetings are creating a formal governance defect that surfaces immediately in due diligence Poland processes.
What should parent companies do in the next 30 days?
The window for low-cost remediation is short. Once a transaction, regulatory review, or litigation begins, governance gaps become negotiating leverage for the other side or evidence of mismanagement. Three actions taken now will close the highest-risk exposures.
First, commission a governance audit of the subsidiary's corporate book. This means verifying that all shareholders' meeting resolutions from the past three years exist, are signed, and match the KRS entries. Discrepancies between the corporate book and the KRS register are more common than parent companies expect – particularly after management board changes or address updates.
Our team secured a corrected KRS entry for a German investor's subsidiary in Lower Silesia (spring 2026) after discovering that a board resignation filed two years earlier had never been registered. The unregistered former director remained formally liable for company obligations throughout that period – a risk neither party had identified before the M&A Poland transaction began.
Second, review all intra-group contracts for the written-form requirement. Service agreements, loans, and IP licences between a wholly-owned subsidiary and its parent must satisfy the written-form rule. Verbal or email-based arrangements do not meet the statutory threshold and can be challenged as invalid.
Third, confirm that the next ordinary shareholders' meeting is calendared and that the agenda covers approval of financial statements, discharge of board members, and any capital decisions required for the coming year. For subsidiaries that need to set up company Poland governance structures from scratch – for example, following a recent acquisition – this meeting should also adopt or update the articles of association to reflect current group policy.
To receive an expert assessment of your subsidiary's governance position, contact info@kordeckipartners.com.
Your subsidiary's specific governance gaps may already be creating personal liability for board members or invalidating intra-group contracts – consequences that cannot be reversed once a transaction or dispute begins. Acting before a triggering event is the only way to preserve full optionality.
If your group holds a Polish sp. z o.o. subsidiary and has not conducted a governance review in the past 12 months, we will assess the KRS record, corporate book, and intra-group contract structure and provide a prioritised remediation plan: info@kordeckipartners.com.
Frequently asked questions
Q: Does a foreign parent company face personal liability for its Polish subsidiary's governance failures?
A: Personal liability under Polish corporate legislation falls primarily on the members of the management board, not the parent entity. However, a parent that exercises de facto management – issuing binding instructions to the board – can be treated as a shadow director under case law developed by Polish courts. This exposure is relevant in wholly-owned subsidiary structures where the parent controls day-to-day decisions. A governance review should map instruction flows as well as formal appointments.
Q: How long does it take to correct KRS registration errors, and what does it cost?
A: Straightforward corrections – such as registering a missed board change – typically take between two and six weeks depending on the relevant district court's caseload. The court fee for a standard KRS amendment is PLN 250. Legal costs depend on the volume of discrepancies. Retroactive documentation exercises, where resolutions must be reconstructed and signed, add time but are generally completed within one to three months.
Q: Is a supervisory board mandatory for a Polish sp. z o.o. subsidiary?
A: A supervisory board is not mandatory for most sp. z o.o. companies under the Commercial Companies Code. It becomes mandatory when the share capital exceeds PLN 500,000 and the company has more than 25 shareholders. Many foreign-owned subsidiaries establish a supervisory board voluntarily as a group governance requirement – but once established, the statutory minimum meeting frequency and quorum rules apply in full. Failing to hold quarterly meetings creates a formal defect even if the board was set up voluntarily.
For further reading on transaction-related governance risks, see our analysis of red flags in Polish M&A for United Kingdom buyers, our step-by-step guide to enforcing a Poland judgment in Poland, and our corporate and M&A practice page.
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 governance, subsidiary compliance, and M&A transactions. 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.