A Poznań-based logistics company was mid-way through a share acquisition when its target's counterpart produced a contract signed under a general power of attorney. The buyer's counsel flagged it immediately. The signatory lacked prokura – the only authority recognised under Polish corporate legislation for that category of transaction. The deal paused for six weeks while the defect was remedied.
Polish law draws a sharp line between prokura – a statutory commercial proxy registered in the National Court Register (KRS) – and an ordinary power of attorney granted under civil law. Prokura confers broad authority to act in all matters connected with running a business. A general power of attorney covers only acts specified in its text and cannot substitute for prokura where the statute requires it. Choosing the wrong instrument does not merely create inconvenience; it can invalidate transactions and expose the company to claims.
This case study traces how a mid-market acquisition in Mazowieckie (autumn 2025) exposed the practical cost of confusing these two instruments. The sections below cover the background, the legal strategy our team applied, the steps taken to resolve the defect, and the lessons any company can apply before signing authority becomes a dispute.
What is prokura and how does it differ from a standard power of attorney?
Prokura is a statutory proxy created exclusively by the Kodeks spółek handlowych (Commercial Companies Code, KSH) and the Kodeks cywilny (Civil Code, KC). It must be granted by the management board and registered in the KRS before it takes effect against third parties. A general power of attorney, by contrast, is a civil-law instrument that can be granted by any legal entity and takes effect on delivery to the agent – no registration is required.
The scope of authority is the key dividing line. Prokura covers all judicial and extrajudicial acts connected with running an enterprise. A general power of attorney covers only what the grantor expressly includes in the document. For acts such as transferring or encumbering an enterprise, or establishing a limited right in rem over real property, Polish corporate legislation requires an additional express authorisation even for a prokurent (prokura holder). A standard attorney-in-fact cannot act at all in those categories without a specific power of attorney drafted to match the transaction precisely.
Registration matters for due diligence Poland purposes. Prokura appears in the KRS and is visible to any counterparty searching the register. A power of attorney is a private document. Buyers conducting M&A Poland transactions must verify both sources – the KRS extract and the physical power of attorney file – to confirm that the person who signed a target company's contracts had authority at the moment of signing. Gaps here are among the most common red flags in Polish M&A.
What went wrong – and how did the defect surface?
The target company, a spółka z ograniczoną odpowiedzialnością (limited liability company, sp. z o.o.) registered in Warsaw, had entered a multi-year service agreement eighteen months before the acquisition. The agreement was signed by the head of operations under a general power of attorney. The power of attorney authorised "all acts relating to the company's operational activities." The drafters assumed that phrase was wide enough.
It was not. Under Polish corporate legislation, a general power of attorney that does not specifically identify the act or category of acts it covers is treated as a pełnomocnictwo ogólne (general mandate). A general mandate covers only ordinary management acts. The service agreement in question involved a five-year commitment and payment obligations exceeding PLN 2m – well outside ordinary management. The signatory needed either prokura or a specific power of attorney identifying that type of long-term commitment. Neither existed.
The defect surfaced during due diligence Poland review conducted by our Warsaw team. A KRS search confirmed the head of operations had never held prokura. The physical power of attorney on file used the broad language described above. The service counterparty had never queried it. But the buyer's lenders required clean title to all material contracts, and this agreement was material. The deal could not close until the question of validity was resolved. We secured a retroactive ratification of the agreement by the full management board within 30 days – preserving the contract and the transaction timeline.
How did we resolve the authority gap?
The resolution required three parallel steps. First, we needed to confirm whether Polish civil law permitted ratification of an act performed without authority. It does. Under the Civil Code, a legal act performed by a person lacking authority is conditionally valid and may be ratified by the principal within a reasonable time. The counterparty to the service agreement consented to a short standstill while ratification was documented.
Second, the management board of the sp. z o.o. passed a formal resolution ratifying the agreement. The resolution identified the agreement by date and parties, confirmed the company's intent to be bound, and was notarised. Notarisation was required because the original agreement had been signed in notarial form. This step took eleven days from the date we identified the defect.
Third, we recommended that the company immediately grant prokura to its head of operations for the remaining period of integration. The prokura was registered in the KRS within fourteen days of filing. From that point, the counterparty and the buyer's lenders could verify authority directly from the register – no private document review required. Our team also assisted in setting up a signing-authority matrix to prevent recurrence. For any company looking to set up company Poland operations or restructure an existing sp. z o.o., a signing-authority matrix should be one of the first governance documents in place.
We obtained the ratification and registration outcome for a client in the Mazowieckie region (autumn 2025), protecting a transaction value of over PLN 8m from a potential rescission claim by the lender group.
What lessons apply to any Polish corporate structure?
The Poznań logistics matter illustrates a pattern we see repeatedly in M&A Poland mandates. Companies grow quickly. Operational managers sign contracts. Boards assume that broad language in a power of attorney covers everything. It does not. The gap between what a general mandate covers and what prokura covers is not a technicality – it is a statutory distinction that Polish courts enforce strictly.
Three transferable lessons stand out. First, any contract with a value above PLN 500,000 or a term exceeding two years should be signed either by a board member or a prokurent. A power of attorney for that act should be transaction-specific, not generic. Second, KRS entries for prokura lapse when a prokurent leaves. Companies that restructure management must revoke old prokura entries promptly – stale entries mislead counterparties and create liability risk. Third, a law firm Warsaw-based or otherwise advising on an acquisition should treat signing-authority verification as a day-one task, not a late-stage check.
What should a company prepare before a transaction or a KAS audit that touches contract validity? The checklist below applies to any sp. z o.o. or joint-stock company.
- Current KRS extract confirming all prokura entries and their scope (individual, joint, or branch-limited)
- Physical copies of all powers of attorney used to sign material contracts in the past three years
- Board resolutions granting each prokura, confirming the scope and any restrictions
- Signing-authority matrix mapping each signatory to their instrument and its limits
- Legal opinion confirming that any transaction-specific powers of attorney match the acts actually performed
For foreign investors, the distinction carries an additional layer of complexity. A German or French group may assume that a broad operational mandate – familiar from their home jurisdiction – functions the same way in Poland. It does not. Prokura is a Polish statutory concept with no direct equivalent in many civil-law systems. Cross-border buyers should consult the analysis of branch vs subsidiary in Poland before deciding which entity type to use, since the choice affects which signing instruments are available and how the KRS will record authority. Tax structuring decisions also interact with authority questions – see the overview of the double tax treaty between Poland and Poland for context on how entity structure and treaty access connect. And for buyers from Ukraine or the CIS region, our guide on red flags in Polish M&A addresses authority defects as one of the most frequently encountered issues in cross-border acquisitions.
The cost of getting this wrong is not abstract. An invalidated contract can trigger a rescission claim, a financing default, or a warranty claim under the sale and purchase agreement. Any of those outcomes is harder to fix than a six-week delay at signing.
Your company's specific signing-authority structure may contain gaps that are not visible until a counterparty or a buyer's counsel looks closely. That moment should not be the first time you discover them.
To receive an expert assessment of your company's signing-authority framework or to discuss prokura structuring before an acquisition, contact info@kordeckipartners.com.
Frequently asked questions
Q: Can a general power of attorney ever replace prokura for running a Polish company?
A: No. Polish corporate legislation treats prokura and a general power of attorney as distinct instruments with different scopes and registration requirements. A general mandate covers only ordinary management acts. Prokura covers all judicial and extrajudicial acts connected with running the enterprise. For any act outside ordinary management – including long-term contracts, litigation, and real property transactions – prokura or a transaction-specific power of attorney is required. A general mandate will not cure the gap.
Q: How long does it take to register prokura in the KRS?
A: The National Court Register (KRS) processes prokura registration applications within seven to fourteen business days when the application is complete. The prokurent may act on the prokura from the moment it is granted by the board, but third parties are protected against claims of lack of authority only from the date of registration. In urgent transactions, companies sometimes file for expedited processing, which can reduce the timeline to five business days in straightforward cases.
Q: Is it a common misconception that signing "on behalf of" the company is enough without specifying the legal basis?
A: Yes, this is one of the most frequent errors we encounter in due diligence Poland reviews. A signatory who writes "on behalf of" a company without identifying the instrument – prokura, specific power of attorney, or board authority – creates an ambiguity that courts resolve against the company. Polish corporate legislation requires that the basis of authority be identifiable from the document or from the KRS. If neither source confirms authority, the act is treated as performed without authorisation and is conditionally invalid until ratified by the board.
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, M&A transactions, and signing-authority structuring. 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.