Poland: limitations of the rules of representation of a company — practical solutions

Limiting the rules of representation of a company is one way to secure the company against unauthorised actions on its behalf. How to do this properly?

Decisions on appointment to a management board are driven by not only the professional qualifications of a candidate but also the trust shareholder’s place in the candidate. By law, each management board member (director) may represent the company. Shareholders usually want to protect a company against abuse of this right or against the negative consequences of its performance. One of the ways of solving this challenge is to introduce the value-based rules of representation.

The Polish Companies Code distinguishes between two terms: the right to represent a company and the rules/manner of a company’s representation. Unfortunately, these terms are commonly confused, even in judicial practice…

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