A limited liability company as a capital company may operate only through its bodies. The management bodies of a limited liability company must be set up at the stage of formation of the company, and information on the bodies and the manner of representation of the company is entered in the articles of association and recorded in the National Court Register.
There are three bodies in the Polish LLC:
- the Management board
- the General Meeting of Shareholders
- the Supervisory Board (or the Review Panel)
The management board and the shareholders ' meeting are mandatory bodies of the LLC, while the supervisory board and the Review Panel are optional bodies in most companies.
The management board
The management board is the most important body of the limited liability company, which deals with the day-to-day affairs of the company and represents it outside. This means that the management board signs contracts on behalf of the company and makes decisions in the course of its activities. The management board is appointed by the Meeting of Shareholders either indefinitely or for a specified period. The term of office of a member of the management board is determined by the Articles of Association of the Company.
The management board can be single-person and make all decisions independently or multi-person and consists of more than one person of the management board, the number of which is usually stipulated in the Articles of Association of the Company. A multi-person board should have a defined representation. As a rule, the representation of a member of the management board is elected independently or together with another member of the management board or a proxy. If the Articles of Association of the Company does not specify the manner of representation, the company is represented by two members of the management board together or one member of the management board and a proxy.
Dismissal of a member of the management board may take place at any time before the end of the term of office by adoption of the resolution by the Extraordinary Shareholder Meeting. It should be noted that a member of the management board may be its shareholder, but not a member of the supervisory board. As the sole body of the company, the members of the management board are liable for the company's obligations if the bailiff's execution of its assets proves to be ineffective.
The General Meeting of Shareholders
The General Meeting of Shareholders is a collegial body consisting of all the shareholders of the company, it is not a permanent body, but convened at the company's request. The General Meeting of Shareholders may be ordinary or extraordinary. Ordinary shareholders' meeting is convened to approve the financial statements, extraordinary - in all other cases provided for in the Articles of Association of the Company. Resolutions of shareholders may concern:
- dismissal and appointment of the management board;
- consent to the disposal or acquisition of shares;
- consent to the disposal or acquisition of immovable property;
- approval of financial statements;
- discharge of members of the management board;
- appointment of a Company’s attorney to represent the company and others.
The resolution of the shareholders is a statement, which applies to all shareholders of the company, including those who were against its adoption. The resolution of the shareholders' meeting causes intra-corporate consequences, m.in. it obliges the management board of the company to take measures to implement the resolutions adopted.
The Supervisory Board (or The Review Panel)
The supervisory board or the Review Panel is a compulsory body only in companies with a share capital of more than PLN 500,000, which have more than 25 shareholders. In other companies, this body does not necessarily have to be convened. As the name implies, the supervisory board is a supervisory body appointed by the shareholders' meeting (unless the Articles of Association of the Company provides otherwise) to supervise the company's activities, including the activities of the management board, company departments, employees, and to evaluate financial statements. The supervisory board may participate in any stage of the company's activities, including the approval of the establishment of a branch, the appointment of proxies or the borrowing of loans by the management board. The scope of activities of the supervisory board may be specified in the Articles of Association of the Company.
The Review Panel is not a supervisory body only a control body, so it does not exercise constant supervision over the company's activities, but only examines the company's financial statements and assets. If the company does not have a supervisory board, the duties and tasks of The Review Panel may be extended.
A member of the Supervisory Board and the Review Panel cannot be:
- member of the management board;
- head of office and its branch;
- lawyer / legal adviser of the company;
- chief accountant.
To sum up, a limited liability company should have 2 compulsory bodies and one optional or which will become compulsory once certain requirements are met. Each of these bodies performs its own role: the shareholders' meeting - the resolution-making body, the management board - the executive and managing body, the supervisory board and the Review Panel - the supervisory and control board. The general principles of the activities of these bodies are defined by the Commercial Companies Code, while each company may specify the activities of each body through appropriate entries in the Articles of Association of the Company, which may not contradict the provisions of the Commercial Companies Code.