From 1 January 2012, foreign entity performing business in Poland through a branch office will be required to complete a liquidation procedure, in accordance with the provisions of the Polish commercial companies code concerning the liquidation of a limited liability company, to close down its Polish branch.
Until now, in accordance with the Supreme Court’s ruling, such procedure was solely required in the case of a compulsory closure of the branch office, due to the decision of the ministry of economy, prohibiting to perform business in Poland.
The above interpretation of the law has been, in majority of the cases, accepted by the registry courts. In consequence, foreign entities were able to close their branched in time and cost effective manner.
The new law directly provides that the liquidation procedure is mandatory for both compulsory and voluntary closure of the branch. As a result of the amendment, time and cost of the voluntary liquidation of the branch will increase considerably. What is more, the closing foreign entity will be subject to additional obligations, in particular concerning preparation of financial documents and publication on the planned closure of its branch.