SIMPLE JOINT-STOCK COMPANY READING LEVEL: C1
Modern, flexible, nimble, innovative, tailored to the needs of start-ups in quest for financing, tapping into venture capital funds and attracting business angels. And the icing on the cake, safe for creditors. A true gem in the crown. Will it deliver, though?
Expected to come into force on 20 March 2020, a game-changing simple joint-stock company (P.S.A) is hoped to revolutionise the way business is done in Poland. Still, the flagship assumptions are but a staple diet of a foreign investor doing business in the Western world.
Where’s the revolution, then?
Elimination of formalities at incorporation:
Speedy electronic registration in the S24 System;
Simplified dematerialisation of shares in the registry, electronic issuance of decisions;
Simplified electronic register of shareholders kept by an investor or a notary – a possibility to use blockchain.
Shares with no par-value vesting preference in respect of voting or dividends;
New type of founder’s shares ensuring retention of the original stake in the shareholding of the founders, irrespective of subsequent issuances of new shares;
Shares issued and allotted in exchange for the know-how, work or services performed for the benefit of the company to facilitate the development of the projects based on human capital;
At the outset PSA’s shares will not be quoted on the stock-exchange, yet at any time it may be transformed into a regular joint-stock company for this purpose.
Flexibility in corporate management rules:
Notarial form no longer required;
Resolutions may be adopted by way of an e-mail or during a video-conference;
Option to hold meetings outside Poland;
Option to introduce an alternative model of the management structure with a one-tier board - the board of directors - as an organ hosting both the executive and non-executive directors, which will ensure transparency and uninhibited access to information.
Protection of creditors:
The company is prohibited from rendering performances for the benefit of the shareholders that could possibly put at risk the company’s solvency;
The duty to transfer 8% of the profit to the company’s capital until it reaches the level of 5% of the company’s outstanding obligations.