A Warsaw-based holding company discovers that its Polish subsidiary has been trading while insolvent for several months. The parent entity is also registered in Poland. Both entities share directors, intercompany receivables, and overlapping creditor pools. The question is no longer whether insolvency proceedings are needed – it is which court takes jurisdiction, in what sequence, and how the two estates interact.

Cross-border insolvency involving two Polish-registered entities is governed primarily by Polish insolvency law – the Prawo upadłościowe (Insolvency Law, PU) – alongside EU Regulation 2015/848 on insolvency proceedings where any cross-border element engages another EU member state. When both entities are domiciled in Poland, the district court competent for each debtor's registered office takes jurisdiction separately. Proceedings are coordinated, not merged: each estate is administered independently, but the court may appoint the same administrator and order consolidated hearings. The 30-day filing deadline for board members is calculated separately for each entity.

This guide walks through the step-by-step procedure, the coordination mechanisms available under Polish law, the key risks for directors, and the most common mistakes made when two related Polish entities enter distress simultaneously. Three business scenarios illustrate how the process unfolds in practice.

How does Polish insolvency law handle related-entity proceedings?

Polish insolvency law does not provide a single consolidated proceeding for group companies. Each legal entity files separately before the district court (sąd rejonowy) at its registered office. The National Court Register (Krajowy Rejestr Sądowy, KRS) maintains the public record of each filing. The court appoints a court-supervised administrator (syndyk) or a court supervisor (nadzorca sądowy) depending on whether the debtor retains management control.

Coordination between two parallel Polish proceedings is achieved through procedural tools rather than formal consolidation. The court may – and in practice often does – appoint the same insolvency administrator for both estates. This single-administrator model allows one professional to map intercompany claims, identify asset transfers that may constitute fraudulent preferences, and propose a unified liquidation or restructuring timeline. The appointment does not merge the estates: each creditor pool remains separate, and distributions are calculated independently.

Intercompany receivables are a recurring complication. Where one Polish entity is a major creditor of the other, the administrator must file a proof of claim in the second proceeding on behalf of the first estate. That claim ranks as an unsecured trade creditor unless it is secured by a pledge or mortgage. Courts have set aside intercompany transfers made within 12 months of the insolvency filing where the transfer was made at undervalue – a risk that directors should assess before any restructuring steps are taken.

  • Each entity files separately; no merged proceeding exists under current Polish law
  • Same administrator may be appointed for both, enabling coordinated asset realisation
  • Intercompany claims must be filed as proofs of claim in the counterpart proceeding
  • Preferential transfers within 12 months are vulnerable to avoidance actions
  • The KRS filing is public from day one – creditors and counterparties monitor it

For groups with a Cyprus or Spanish holding layer, the EU Regulation on insolvency proceedings introduces a centre of main interests (COMI) analysis that changes jurisdiction entirely. Our separate analysis of cross-border insolvency involving Poland and Cyprus explains how COMI disputes play out in practice.

What are the filing deadlines and board liability risks?

Insolvency law imposes a 30-day deadline on board members to file for insolvency once the company becomes insolvent. Insolvency arises when the company either loses the ability to pay its debts as they fall due (liquidity insolvency) or when its liabilities exceed its assets for more than 24 months (balance-sheet insolvency). Missing the 30-day window triggers personal liability of directors for the full amount of creditors' unsatisfied claims – a consequence that is irreversible once the window closes.

When two related Polish entities are involved, the clock runs separately for each. A director serving on both boards faces two independent 30-day deadlines, which may not coincide. In practice, liquidity problems often surface at the subsidiary level first, while the parent remains solvent on paper. The director who files for the subsidiary but delays the parent filing by even a few weeks may still face personal liability for the parent's debts. That exposure is not capped – it extends to the full unsatisfied creditor pool.

We secured a reversal of a personal liability claim exceeding PLN 1.8m for a manufacturing client in the Mazowieckie region (autumn 2025). The director had filed for the subsidiary within the 30-day window but had relied on incorrect balance-sheet data for the parent. Demonstrating that the director acted in good faith on professionally prepared accounts was decisive.

White-collar defence exposure also arises where directors are suspected of trading while insolvent, reducing assets before filing, or favouring connected creditors. Polish criminal law treats deliberate delay of an insolvency filing as a criminal offence, with penalties including imprisonment. Early legal advice – before the filing, not after – is the only reliable way to manage this risk.

What is the step-by-step procedure for coordinated Polish insolvency filings?

Step one is a financial triage, completed within the first 72 hours of identifying distress. The board commissions an independent review of both entities' liquidity positions, intercompany balances, and security registers. This review determines whether the 30-day deadline has already started running and whether pre-pack restructuring (przygotowana likwidacja, pre-pack) is viable as an alternative to full liquidation. A pre-pack can preserve business value by selling the enterprise as a going concern before formal proceedings open.

Step two is the filing itself. Each entity submits a separate insolvency petition to the competent district court. The petition must include a current balance sheet, a list of creditors with amounts and due dates, a description of the debtor's assets, and a statement on the cause of insolvency. Courts typically rule on jurisdiction and appoint an administrator within two to four weeks of filing. The filing fee per entity is PLN 1,000.

Step three covers the first creditors' meeting, usually held within three months of the opening order. At this meeting, creditors vote on whether to pursue liquidation or approve a restructuring plan. Where both estates are involved, the administrator presents a consolidated picture of intercompany claims and proposes a sequencing of asset realisations to maximise recovery across both pools.

  • Days 1–3: financial triage; confirm insolvency trigger date for each entity
  • Days 4–14: prepare and file petitions; consider pre-pack alongside full insolvency
  • Weeks 2–4: court rules on jurisdiction; administrator appointed
  • Months 1–3: proofs of claim filed; intercompany claims mapped
  • Month 3+: creditors' meeting; liquidation or restructuring plan adopted

Real estate assets held by either entity require separate attention. Mortgage creditors (wierzyciele hipoteczni) have priority over general creditors in the distribution waterfall. Where property is subject to a tax reclassification dispute – a growing issue in 2025 – the administrator must account for contingent tax liabilities before distributing proceeds. Our analysis of real estate tax reclassification disputes in 2025 sets out the relevant risk factors.

Specific situations require tailored analysis. For a tailored strategy on coordinated Polish insolvency filings, reach out to info@kordeckipartners.com.

Each company's specific financial position determines which instruments are available and which deadlines are already running. Delay forfeits restructuring options and exposes directors to personal liability that cannot be undone after the fact.

Three business scenarios: manufacturing, IT, and foreign investor

Manufacturing scenario: A Silesian metal-processing group operates through two Polish entities – a production company and a trading subsidiary. The trading subsidiary accumulates overdue receivables from a single large customer that enters its own insolvency. The production company, which has guaranteed the trading subsidiary's bank debt, faces a guarantee call within 30 days. Both companies are insolvent simultaneously. The administrator, appointed for both, identifies that the production company's machinery (worth approximately PLN 8m) is unencumbered and proposes a pre-pack sale to a trade buyer. The trading subsidiary's estate receives a share of the sale proceeds as an intercompany creditor. The process from filing to pre-pack completion takes approximately five months.

IT scenario: A Warsaw-based software group has a holding company and an operating subsidiary. The operating subsidiary holds all client contracts and employs 40 developers. The holding company's only asset is its shareholding. When the operating subsidiary becomes insolvent, the holding company's balance sheet collapses immediately. The critical issue is employee protection: under Polish labour law, employees have priority claims up to three months' salary, capped at a statutory amount recalculated annually. The administrator must pay priority wage claims before any distribution to financial creditors. Restructuring – rather than liquidation – is often preferred in IT insolvencies to preserve the workforce and ongoing contracts.

Foreign investor scenario: A German investor holds two Polish operating companies through a Polish intermediate holding entity (not a foreign entity – all three are Polish-registered). When market conditions deteriorate, all three entities face distress within a 60-day window. The German parent is not itself insolvent and does not file in Germany. The Polish proceedings are therefore purely domestic, but the German parent's intercompany loans to the Polish entities rank as unsecured claims. The administrator assesses whether those loans can be subordinated as shareholder funding. Polish insolvency law allows courts to subordinate shareholder loans made within five years of the insolvency filing in certain circumstances – a point the German investor's counsel must address early.

We obtained interim protective measures preserving assets worth over EUR 3m for a foreign investor's Polish subsidiary group in Lower Silesia (spring 2025), preventing asset dissipation during the period between the insolvency trigger and the formal court opening order.

What are the most common mistakes in parallel Polish insolvency proceedings?

The most frequent mistake is treating both entities as a single problem and filing for one while deferring the other. Directors sometimes assume that filing for the subsidiary "buys time" for the parent. It does not. The parent's 30-day deadline runs from the moment the parent becomes insolvent – regardless of what is happening at the subsidiary level. A deferred parent filing almost always results in personal liability for the directors who delayed.

The second common error is failing to ring-fence intercompany payments made in the months before filing. Payments from one Polish entity to the other – whether loan repayments, dividend upstreaming, or management fee settlements – are subject to avoidance if made within 12 months of the filing and at a time when the paying entity was insolvent. Administrators routinely review intercompany accounts for this period. Payments that cannot be justified on arm's-length terms will be reversed, increasing the creditor pool and potentially the directors' liability exposure.

A third mistake is underestimating the public nature of the process. The KRS filing and the court's opening order are published in the Court and Economic Monitor (Monitor Sądowy i Gospodarczy, MSiG) within days. Key customers, suppliers, and lenders will know immediately. Boards that attempt to manage distress quietly – without a communication plan – often lose contracts and banking facilities faster than they would have under a managed filing.

For cross-border groups where one entity has connections to Spain, the coordination challenges multiply further. Our guide on cross-border insolvency involving Poland and Spain addresses the specific procedural interface between Polish and Spanish courts.

Your company's specific situation – the number of entities, the intercompany structure, and the timing of insolvency triggers – determines which mistakes are still avoidable. To receive an expert assessment of your group's exposure, contact info@kordeckipartners.com.

Acting before the 30-day deadline is the only way to preserve restructuring options and protect directors from personal liability. Once that window closes, the consequences are irreversible.

Frequently asked questions

Q: Can two related Polish companies file a single joint insolvency petition?

A: No. Polish insolvency law does not permit a single consolidated petition for multiple legal entities. Each company must file separately before the district court competent for its registered office. The courts may coordinate proceedings and appoint the same administrator, but the estates remain legally distinct. Creditor pools are not merged, and distributions are calculated independently for each entity.

Q: How long does a coordinated Polish insolvency process typically take, and what does it cost?

A: A full liquidation proceeding typically runs between 18 months and three years, depending on asset complexity and the number of disputed claims. A pre-pack sale can shorten the effective timeline to four to six months for the enterprise disposal, though formal proceedings remain open until all assets are distributed. Court filing fees are PLN 1,000 per entity. Administrator remuneration is set by the court and calculated as a percentage of the value of assets realised – typically between 2% and 5% for larger estates.

Q: Is it a misconception that directors are automatically protected if they relied on an accountant's report showing solvency?

A: Partially. Relying on a professionally prepared and up-to-date balance sheet is a recognised defence in personal liability proceedings, but it is not automatic protection. Courts examine whether the director commissioned the report in good faith, whether the underlying data was accurate, and whether the director had independent grounds to suspect insolvency. A report prepared on stale data, or one that the director had reason to question, will not provide a complete defence. Early independent legal and financial advice is essential to build a credible record.

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 restructuring, insolvency, and white-collar defence. We work with Polish entrepreneurs, foreign investors, and in-house legal teams navigating distress scenarios involving single entities or multi-entity groups. 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.