Newsletter No. 5/2021

1. The scope and application of a commercial representation

A commercial representation (prokura) is most frequently associated with companies, despite being regulated by the Civil Code, and not the Commercial Companies Code. A commercial representative (prokurent) may be appointed by a company or partnership registered in the National Court Register (KRS), as well as by a sole trader registered in the Central Registration and Information on Economic Activity (the CEIDG).

2. Restrictions on the management board’s actions

Not all management board members are aware of the existence of provisions protecting business partners and company property from overextending investments or risky business choices. Management board members must remember that they require relevant resolutions of the shareholders’ meeting before they can perform certain actions. A failure to observe this obligation may have very serious consequences.