A foreign company can conduct business in Poland by opening a branch. A branch is a separate and organizationally independent part of economic activity carried out by an entrepreneur outside the head office.
The basic principles of the establishment and operation of a branch of a foreign entrepreneur in Poland are set out in articles 14-20 of the act of 6 March 2018 on the rules of participation of foreign entrepreneurs and other foreign persons in economic trade in the territory of the Republic of Poland. Foreign companies may conduct business activities in Poland on the basis of reciprocity, unless the ratified international agreements provide otherwise. This means that foreign companies may open branches in Poland, provided that the domestic law of the country of registration of a foreign company confer similar rights on Polish entrepreneurs willing to start business in that country (principle of reciprocity). However, the requirement of reciprocity does not apply to companies from member states of the European Union, the European Economic Area, as well as from other countries which can benefit from an EU principle of freedom of establishment. Entrepreneurs from these countries can register a branch in Poland without any additional restrictions, which results from the very essence of the EU Treaty principle of freedom of establishment.
A foreign company, in order to register a branch in Poland, must have the right to use a premise that is the registered office of a branch on the territory of Poland, such as lease agreement or virtual office contract. Additionally, it is necessary to appoint a representative authorized to act on behalf of a foreign company in Polish branch. This person does not have to have Polish citizenship, but it is enough to have an address of residence on the territory of Poland (the address may coincide with the address of the branch). Also, a foreign company is obliged to keep separate accounting records in Polish in accordance with Polish law. The activities of the branch should coincide with the activities of the head office. The name of the branch must be the same as the name of the foreign company, translated into Polish and with the addition of the term «branch in Poland».
To open a branch in Poland, it is necessary to register in the National Court Register (KRS) by submitting an application. The application is made on the KRS-W10 form, to which the documents required for registration must be attached. The court fee from the application for registration of a branch of a foreign entrepreneur is PLN 500.
A branch of a foreign company is subject to limited taxation in Poland. This means that the entity pays the Corporate Income Tax (CIT) in Poland only on the income received on its territory. In addition, a branch of a foreign company may acquire the status of a VAT payer.