Professor Anna Zawadzka, together with Dr Jakub Stelmach – a tax disputes specialist cooperating with the firm – has published a commentary on the rules on groups of companies introduced into the Commercial Companies Code by the 2022 amendment. The analysis summarises the first year of the new rules in practice.
The amendment, in force since 13 October 2022, allows a parent company to issue binding instructions to subsidiaries that participate in a group of companies. The rules changed the liability of management board members of subsidiaries – and this is the focus of the commentary.
Key conclusions
- Few groups, many questions – a year after the rules took effect, few groups have disclosed their participation in a group of companies in the National Court Register, yet clients ask about the consequences of binding instructions in almost every restructuring.
- Management board liability – carrying out a binding instruction protects a subsidiary’s board member only if the instruction meets the formal requirements. Failing to meet them shifts the risk back to the board.
- Protection of minority shareholders – the new rules give them the right to demand a buy-out of their shares, but the valuation procedure is still disputed.
“The rules on groups of companies have given management boards a tool, but they have not relieved them of responsibility. Every binding instruction should be read as if it were going to court tomorrow.”
– Professor Anna Zawadzka, Managing Partner, ZMW LegalThe commentary is intended for members of management and supervisory boards of companies within capital groups. We will be happy to discuss its conclusions in the context of your group.