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Opening a Branch vs. a Subsidiary in Poland

Opening a Branch vs. a Subsidiary in Poland

Foreign businesses operating in Poland may choose to establish branches or subsidiaries in Poland. These two forms of legal entities are different and the foreign parent company may opt for one or the other depending on the type of activities conducted in Poland or its business profile. Our company formation experts in Poland are ready to provide more specific information about each type of legal entity in Poland.

Branches in Poland

The main aspect that differentiates branches from subsidiaries is that Polish branches do not have legal personality. Branches are simply a distinct part of a larger company, operating in another country. The parent company is fully liable for the actions and debts of the branch, thus this form of legal entity must be carefully considered and it may not be suited for companies that cannot contain possible damages encountered by the Polish branch.

Branches in Poland must have a designated representative. The person appointed as the branch representative in Poland is authorized to perform certain activities and has a certain amount of authority within the branch, although these duties cannot be compared to those of a management board. Our Polish company formation experts can offer you more information about general and particular liabilities for branches in Poland.

Subsidiaries in Poland

Subsidiaries are legal entities that usually take the form of a Polish limited liability company (Sp. Z.O.O.). Foreign companies that want to establish subsidiaries in Poland need to provide a minimum share capital of at least 5,000 PLN. Limited liability companies need to be registered at the Polish Trade Register.

Polish subsidiaries are fully liable for their actions. Also, the company must comply with specific regulations regarding financial reporting and various other duties. Our company formation team in Poland can help you with tax compliance and offer you more information about the bankruptcy law in Poland.

Business owners who want to open branches or subsidiaries in Poland must have clear intentions when deciding to invest in Poland and choose the best form of legal entity according to their specific business needs. Our team of company formation agents in Poland can provide more information and offer you legal counselling for any matter concerning company incorporation in Poland.