11 April 2017 angelika.rapala

Conducting business activities in the Republic of Poland by foreigners

 

Because of the economical and geopolitical factors Poland has recently become an attractive place to take up a job or start an own business activity by citizens of the Eastern countries. In the context of Start-Up, it is worth mentioning, how a foreigner, who is living in the Republic of Poland, can start or continue a business activity or create a Start Up with other citizens of the Republic of Poland.

Generally, foreigners can conduct a business activity on the same conditions, as the citizens of the RP, if:

1. A foreigner is a citizen of one of the:

  • member states of the EU,
  •  member states of the European Free Trade Association (EFTA) – contracting parties to the European Economic Area Agreement,
  • a foreigner comes from country that is not a contracting party to the European Economic Area Agreement, but has right to use the freedom of establishment based on agreements concluded by this state with the European Union and its member states;

or

2. A foreigner comes from other countries than the above mentioned, but has one of the following permits:

  • permanent residence permit,
  • a long-term EU resident permit,
  • a temporary residence permit granted for the purpose of undertaking higher education or a temporary residence permit granted for the purpose of the family reunion, excluding the circumstances mentioned in section 1 item 1 letter a, d, Art. 186, section 1 item 3 and 4 Act on foreigners,
  • a temporary residence permit granted to a family member on the territory of the Republic of Poland or on this territory for the purpose of family reunion in accordance with Art. 159 section 3 and 4 Act on foreigners for some groups (with a permanent residence permit, resident permit, refugee status and supplementary protection),
  • refugee status,
  • supplementary protection,
  • residence permit due to humanitarian reasons and consent for tolerated stay
  • a temporary residence permit and is married to a Polish national residing in the Republic of Poland,
  • a temporary residence permit to conduct a business activity, which is granted to continue an already formed business activity based on the CEIDG (Central Registration and Information on Business) entry. This permit is specified in the Art. 142 Act on foreigners – it describes the conditions, which shall be fulfilled to get a temporary residence permit.

 

 

Foreigners, who do not belong to the above-mentioned groups, can also conduct a business activity in the Republic of Poland, however they are not permitted to conduct a business as a natural person entered into the CEIDG or as a personal company: registered company and partnership. Nevertheless, depending on the country of origin these issues are regulated by different agreements.

Foreigners – Start-Ups, who have a temporary residence permit and state of domicile in the Republic of Poland can develop own business within the acceleration programs (so called business incubator). During the “incubation” process, a foreigner becomes a member of a foundation through which he can conclude agreements, issue invoices and pay taxes. Because of the reduced costs and help with the formalities, such incubation is an attractive way to start own business by foreigners.

Every foreigner has a right to start and conduct a business activity in form of a limited partnership, limited joint-stock partnership, limited liability and joint stock company, as well as can join such companies and take up or buy shares or stocks, unless the international acts provide otherwise.

Commonly are set up partnerships in form of a limited liability company and because of that, further is described such legal frame of business activity. To start a commercial company, it is necessary to bring an application to the registry court and to register partnership in the National Court Register KRS.The limited liability company can be set up as follows:

1. on-line with a standard agreement available via ICT system (so-called S-24),

  • there is a special field for foreigners, who don’t have a PESEL (Polish Resident Identification Number) number,
  • The court fee for the entry amounts to 350 PLN.
  • The partnership can be formed without a notarial deed.
  • The company agreement is drawn up based on a form that can be modified only in a limited scope, in case there are many individual settlements, the partnership shall be registered in the traditional way.
    1. To form a partnership in the traditional way, it’s necessary to:
  • Conclude an agreement in a form of a notarial deed,
  • Submit documents in the National Court Register (hereinafter called as KRS) and pay a registry fee to the National Court Register, as well as amount of 100 PLN for the notice in the Court and Economic Monitor.

 

Foreigners don’t have to stay in Poland in order to hold shares in limited liability company or be a board member, however they don’t get a residence permit automatically.It must be pointed out that still the legal basis of residence in Poland is visa or residence permit.Nevertheless, joining a company or acquiring shares can be helpful in getting a temporary residence permit for the purpose of business activity in RP (Art. 147 Act on foreigners)

In order to get a temporary residence permit and conduct a business activity in form of a limited liability company, foreigner should be a shareholder or member of a management board, as well as submit the following documents, i.e. health insurance, source of the stable and regular income to cover the costs of own and family members’ care.

  • A foreigner – shareholder and member of the management board at the same time, is obliged to apply for the temporary residence permit to conduct a business activity and to get a work permit.
  • A foreigner, who is not a shareholder, but fulfils some functions in the management board shall apply for a uniform temporary residence and work permit.

Because of other premises and legislative process, a temporary residence permit to conduct a business activity should not be confused with a temporary residence and work permit.

Foreigners also can buy already formed limited liability companies. However, if a property or perpetual usufruct belong to company’s assets, foreigner shall first get a permit to acquire a property in Poland. The obligation to get a permit results from the law on acquisition of property by foreigners (law from 24. March 1920 journal of laws no. 31 item 178).

Foreigners can continue and create a business activity. Here limited is only business form, as well as form of getting a temporary residence permit to run a business activity. That’s why foreigners don’t have to perform work, which don’t comply with their education, but they can work in Polish Start-ups, create new technical solutions or participate in incubation or acceleration programs. It’s worth mentioning that in EU are currently conducted some legislative works, which shall have led to visa removal for our neighbours from Ukraine, what indirectly will simplify process of forming a business activity outside Ukraine.

 

 

Remember:

  • The Act on Freedom of Business Activity describes, when foreigners can form a business activity on the same conditions as the citizens of the Republic of Poland.
  • Foreigners i.e. from Ukraine, Belarus, Albania, Georgia, who don’t have temporary residence permits in the Republic of Poland, CAN’T CONDUCT a business activity as a natural person and register into CEIDG and CAN’T register personal companies.
  • Foreigners, who have temporary residence permit can use the business incubators and acceleration programs.
  • Foreigners can join a limited partnership, limited joint-stock partnership, limited liability and joint stock company, as well as acquire and take up shares or stocks, unless the international acts provide otherwise.
  • If a foreigner wants to stay in the territory of RP he is obliged to get a visa or temporary residence permit to conduct a business activity, even if he has already joined in a company.
  • A foreigner – shareholder and member of the management board at the same time, is obliged to apply for the temporary residence permit in order to conduct a business activity and for work permit. A foreigner, who is not a shareholder, but fulfils some functions in the management board shall apply for a uniform temporary residence and work permit.
  • In order to buy a property by foreigners, which ex. belongs to company’s assets, some additional obligations shall be fulfilled in accordance with the law on acquisition of property by foreigners.

 

Magda Judejko

(lawyer/event manager in SWLEX),

+48 884 797 878, magda.judejko@swlex.pl

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