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Starting a company

The principal legal act governing business activity in Poland is the Economic Freedom Act of 2 July 2004. It regulates the undertaking, running and winding-up of businesses in Poland, as well as tasks of the public administration in this regard. Following the article 44 of the EC Treaty each entrepreneur within the European Community has a right to choose from various forms of conducting business activity, which he finds most suitable for his business. With this regard Member States are obliged to realise the freedom of business activity.
According to the regulations of the European Community, there exists a division of entrepreneurial freedom into primary and secondary one, which has to be enforced and respected by all member states.

The primary entrepreneurial freedom envisages:

the right of entrepreneurs from the Member States to carry out the self-employment,
the right of entrepreneurs to incorporate and to conduct business activity,
the right to purchase shares of enterprises.

On the other hand secondary entrepreneurial freedom creates an opportunity to geographically expand conducting of business activity in the form of self-reliant subsidiaries, such as branch offices, agencies, which are organisationally dependent on their parent company.

The most important factors determining the final choice of the form of conducting business activity include requirements concerning initial capital, scope of shareholders’ liability or formalities prior to commencing business activity.

Entrepreneurs can choose the most relevant form for their business from the list below:

Entry in the Business Activity Register (Wpis do ewidencji działalności gospodarczej)
Civil Partnership (Spółka cywilna)
Registered Partnership (Spółka jawna)
Limited partnership (Spółka komandytowa)
Limited Joint-Stock Partnership (Spółka komandytowo-akcyjna)
Professional Partnership (Spółka partnerska)
Limited Liability Company (Spółka z ograniczoną odpowiedzialnością)
Joint-Stock Company (Spółka akcyjna)
Branch Office (Oddział)
Representative Office (Przedstawicielstwo)

Entrepreneurs from outside the EEA can operate only in the form of:

limited liability company,
joint-stock company,
limited partnership,
limited joint-stock partnership.

more information: www.paiz.gov.pl; www.poland.gov.pl; www.doingbusiness.org

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Individual conducting of business activity

One of the simplest ways of conducting business in Poland, and one which is open to Poles and individuals from the European Economic Area (subject to reciprocity between the individual's home country and Poland) is to register as an individual conducting business activity.
The advantages of this form is that no capital is required, and start-up costs are low. The individual must create an entry in the Business Activity Register (Ewidencja działalności gospodarczej), by completing just a few necessary forms in order to obtain a number from the national office of statistics (GUS), social security organisation (ZUS) and from the VAT office (Urząd Skarbowy). The administrative cost is PLN 100, and the process takes approximately 4-6 weeks. The businessman will then have the necessary NIP and REGON numbers which allow him to conduct business.
Taxes are paid monthly though personal income tax declarations (PIT) as well as through social security contributions and VAT charges.
The disadvantage of this form of conducting business is that the business person potentially faces unlimited liability for the company’s debts.

Source: PAIIIZ, Ministry of Economy