How to start your business in Poland?

The Polish market is open to foreign entrepreneurs, also from outside of the European Union. This means that individuals from abroad may freely run a business in Poland and, consequently, may also without any obstacles buy a shelf company in order to run such a business.

Rules of running a business in Poland

Rules of conducting business activity in Poland by foreigners are provided in the Act on the rules for participation of foreign entrepreneurs and other foreign persons in economic transactions in the territory of the Republic of Poland. The provisions of the above act distinguish two groups of individuals who may conduct business activity in Poland, depending on the country of origin and legalisation of stay.

Citizens of member states

Foreigners from the member states of the EU and EFTA (Norway, Iceland, Lichtenstein, Switzerland) are subject to the so-called principle of equality. This means that they are entitled to commence and conduct business activity in Poland on the terms applicable to Polish citizens.

Citizens of third countries

Conditions of conducting business activity by citizens of third countries (i.e. countries which are not a part of either the EU or EFTA) depend on whether or not a given person has legalised their stay in Poland.

Foreigners who may legally stay in the territory of Poland, i.e. have:

• • a permanent residence permit,
  • a temporary residence permit granted due to specific circumstances (inter alia, in order to conduct business activity on the basis of entry in the Central Business Register and Information Service (CEIDG) due to gaining education in the course of academic studies or being married to a Polish citizen residing in the Republic of Poland),
  • the status of a refugee,
  • subsidiary protection,
  • consent to their stay for humanitarian reasons or consent to tolerated stay

also have the right to conduct business activity on the same terms as Polish citizens. This also applies to individuals who are subject to temporary protection in Poland, hold a valid Pole’s Card or are family members who join citizens of member states or stay with them.

Legalisation of stay vs business activity

Lack of legalisation of stay is not synonymous with lack of rights to conduct business activity in Poland. Foreigners who do not meet the conditions necessary to make it possible for them to function on the Polish market on the terms applicable to Polish citizens may also commence and conduct business activity, but there have been certain restrictions introduced as regards the form in which it is conducted. Such foreign individuals may run a business exclusively in the form of a limited partnership, limited joint-stock partnership, limited liability company and a joint-stock company, though this provision may be amended pursuant to an agreement concluded between Poland and a third country.

Who may buy a shelf company in Poland?

Consequently, even foreigners coming from a country which is not an EU member state who do not have a permit for residence in Poland may buy a shelf company (e.g. a limited liability company) which will be used to conduct business activity. Such an entrepreneur may start operating right away, additionally avoiding many time-consuming formalities related to company formation.

Foreign individuals and functions in companies

Foreign individuals may also hold functions in companies operating on the Polish market, one of which is the function of the member of the company’s management board. Taking it may be subject to various conditions which depend on the foreigner’s country of origin.

Just as it is the case with the right to conduct business activity, a citizen of an EU or an EFTA member state may hold the function of a member of the company’s management board on the terms applicable to Polish citizens, so without any additional formalities.

The situation is different in the case of a foreigner from a third country who holds the function in the management board of a legal entity entered in the register of businesses or being a company in formation, or due to running affairs of a limited partnership or a limited joint-stock partnership as a general partner, or due to having been granted commercial proxy.

Depending on the length of such person’s stay in the territory of Poland during the year, they may be subject to the obligation to obtain the relevant work permit. This means that individuals holding function “remotely”, i.e. staying in Poland for a period not longer than a total of 6 months during the consecutive 12 months, are not obliged to have a work permit. However, if the length of their stay exceeds the period referred to above, the foreigner becomes obliged to hold a type B work permit.

Such a permit has to be applied for with respect to the management board member, even if they do not get a fee for holding the function, immediately after entry in the National Court Register. The procedure for obtaining a work permit takes a few months and may be conducted by a proxy without the need for the foreigner to come to Poland, based on the existing documents of the company. On the basis of the work permit obtained in Poland a foreigner from outside of the EU may obtain in a Polish Consulate in their country of origin a visa with a work permit for the period of validity of the permit and then, after their arrival in Poland, apply for issuance of a residence card. One has to bear in mind that working in Poland is legal only when the foreigner has the right to hold the function in the management board and legally stays in Poland.