Is it possible to do business in Poland without registration?
One of the first steps to entrepreneurship in Poland for foreigners is to choose the type of company to be registered. This material will consolidate basic information on the types of business organization in RP, and the most popular forms can be studied in more detail by following the links in the text.
What to choose sole proprietorship, LLC, joint stock company or other form. What kind of business activity in Poland is better to register for a Ukrainian, Russian or Belarusian. Advantages and disadvantages of each type of doing business in RP. Read all this and more in this material.
Can foreigners start a business in Poland?
Foreigners can open a company or register a sole proprietorship in Poland. However, the status of citizens of other states determines the possibility of using one or another instrument. This will be discussed in detail later on, but for now, a point of principle:
A foreigner in this article will be understood as a citizen of Ukraine, Russia, the Republic of Belarus or other non-EU, non-European Economic Area state who is not a citizen of Switzerland and/or the United States. For the listed countries there are their own rules for doing business in the EP, which are not considered in this material.
Is it possible to do business in Poland without registration?
We can! There is such a form of income generation as działalność nierejestrowa or firma na próbę (unregistered activity or “firma probynik”). This is a rather specific type of “entrepreneurship” that involves earning a very low income and fulfilling a host of other conditions.
This option as a start should be considered by those who are already in Poland, who can engage in simple handicraft production, who wish to engage in their own economic activity while working.
What types of business organization exist in Poland?
To start a business in Poland you need to choose and register a form of business activity. All types of stand-alone business units existing at the time of publication:
- Jednoosobowej działalności gospodarczej. Individual entrepreneur.
- Spółka cywilna. Civil Partnership.
- Spółka jawna. General Partnership.
- Spółka partnerska. Partnership.
- Spółka komandytowa. Limited Partnership.
- Spółka komandytowo-akcyjna. Limited Joint Stock Company.
- Spółka z ograniczoną odpowiedzialnością. Limited Liability Company.
- Spółka akcyjna. Joint Stock Company.
- Prosta spółka akcyjna. A simple joint stock company.
Let’s deal with each type in more detail, but first a few words about the restrictions for foreigners and, conversely, those for whom there are no restrictions.
Restrictions for foreigners
The following types of companies are available for establishment (organization) to all foreigners under consideration, irrespective of their status:
- Spółka komandytowa.
- Spółka komandytowo-akcyjna.
- Spółka z ograniczoną odpowiedzialnością (the most popular form among foreigners in the RP).
- Spółka akcyjna.
- Prosta spółka akcyjna.
Other forms will require additional conditions (status, residence permit, etc.), but there are also conditions under which foreigners can open the same types of companies / sole proprietorships as Polish citizens. This is available to holders of the following statuses:
- permanent residency;
- residence permit of a long-term resident of the European Union;
- temporary residence permit issued in connection with family reunification;
- refugees;
- auxiliary or temporary protection;
- permission to stay on humanitarian grounds or tolerated stay permit;
- temporary residence permit by marriage to a citizen of the Republic of Poland residing in Poland;
- a temporary residence permit for the purpose of conducting business activities, issued in connection with the continuation of an existing business activity on the basis of an entry in the CEIDG;
- Pole card holders;
- family members of an EU, EEA, or Swiss citizen;
- with Business Harbour visas.
Other restrictions
A few more words about the limitations. They no longer apply not only to foreigners, but to all business entities.
There are some types of entrepreneurship that require specific forms of organization under the laws of the Republic of Poland. For example, agricultural activities are registered and monitored in a special way. Some types require additional licensing or certification. Others are only available for certain forms of business.
You can find out more about the selected type of activity on the business portal of the Polish government: select the activity of interest, click on it and read the information provided).
Let’s move directly to organizational forms.
Jednoosobowej działalności gospodarczej, or Individual Entrepreneur
Individual economic activity is an analog of the individual entrepreneur familiar in CIS countries – IE (in the Republic of Belarus and the Russian Federation) or FOP (Ukraine). One of the most desirable forms of organization by foreigners, but only available to the privileged categories listed above.
The pros include ease of registration (can be online), ease of reporting. To the minuses, except for the availability of IE is not available to all foreigners, the level of responsibility – an individual entrepreneur is liable for obligations with all his property.
Spółka cywilna, or Civil Society
It is a kind of association of already established companies and/or sole proprietorships with certain purposes (primarily for profit). The Spółka cywilna does not form a separate legal entity, but acts on behalf of its members.
Foreigners can open a company in Poland in the form of a civil society without restrictions, but the founders must be at least two, moreover, already registered as business units.
Spółka cywilna is a rather specific form of case management, not suitable for all cases.
Spółka jawna, or general partnership
On the one hand, a general partnership is a full legal entity available to foreigners and suitable for most types of activities in Poland. It is not difficult to establish it, it is enough to draw up a contract (minimum two participants) and register the company.
But on the other hand, under this form of organization, each member is liable for its obligations with all its property. Counterparties are happy to work with such a partnership, but among foreigners it is practically not popular, just because of the level of liability.
Spółka partnerska, or Partnership
A very specific form of business organization, as. is only suitable for certain categories of activities. Lawyers, doctors, veterinarians, accountants, architects, brokers, etc., among others, can organize a partnership.
Spółka partnerska is available to foreigners, but the above conditions are mandatory for all.
Spółka komandytowa, or Limited Partnership
This is a form of business organization in which the participants are at different levels of responsibility. There are general partners who are liable with all of their assets, and there are limited partners with limited liability, which is initially spelled out in the contract.
In practice it is applied, for example, when some partners (partera) have funds and others have an idea. A limited partnership agreement requires mandatory notarization. It is not very popular with foreigners, but it is narrowly applied.
Spółka komandytowo-akcyjna, or Limited Joint Stock Company
It is already evident from the name that this form of business activity is something in common between a limited partnership and a joint-stock company.
General partners are founders, part partners are shareholders. Assumes a complex registration system, authorized capital of at least 50000 PLN, complicated taxation and accounting methods. There is little or no use by foreigners.
Spółka z ograniczoną odpowiedzialnością, or Limited Liability Company
LLC familiar to many people in the CIS countries. Organized by one or more founders who are liable for obligations only with the property of the limited liability company itself (subject to legal regulations).
LLC registration is available to foreigners. Moreover, it is the most popular form of doing business in Poland. You can open online, including remotely.
Spółka akcyjna, or Joint Stock Company
This is an option for medium to large businesses. Or for those foreigners who are already well-versed in Poland’s business processes. Assumes a complex registration procedure, authorized capital of at least 100,000 PLN, complex reporting, management and control.
The joint stock company is available to foreigners, but is rarely used.
Prosta Spółka Akcyjna, or Simple Joint Stock Company
A relatively new type of business organization in Poland (in the legal field since 2021). It is a kind of symbiosis of LLC and JSC, but with extremely simple registration (including online), simplified reporting, formal issue of shares and authorized capital of 1 zloty.
A simple joint stock company is convenient for various startups, blockchain platforms, etc. It is available to foreigners, but there is still insufficient information about mass application (due to the recent appearance of the form). Presumably – will take its place among the popular types of doing business.
What type of Polish firm should beginners choose?
It is unlikely that universal advice can be given here, as. every situation is unique. You have to look at the circumstances, the requirements, the intentions. However, you can try to shorten the list of what is possible by working backwards:
- Keep a list of all possible forms of business in the RP in front of you.
- Is a sole proprietorship available to you? If yes, consider all the possibilities of this form, and if they meet your requirements, opt for a sole proprietorship.
- If not, remove the PI from the list, and continue with the review.
- Can you participate in a partnership?If yes, coordinate this form with the other partners and register it.
- If not, cross it out.
- At this stage of development, do you need the complexities of a limited company, limited joint-stock company and joint-stock company? Are the conditions of Spółka cywilna suitable for you? If yes, have it handled professionally. It is unlikely that our simplified selection scheme will suit such an advanced businessman.
- If not, cross it out.
Actually, by this point you have either already chosen a form of business, or you have a list of just two items in front of you: an LLC and a simple joint stock company. Go to the links, and re-read everything carefully again. Further, the choice is entirely up to you, as. no one else knows your intentions.
In conclusion, a few more questions and answers related to the topic at hand.
Conclusion
Choosing the type of company to register a business in Poland is not so difficult. With all the variety of existing forms, not all of them are available to foreigners, and the remaining ones are suitable for specific activities. Having excluded the impossible, there remains a very small list of permissible, from which we must choose the most appropriate type of organization.
Well, if you need expert help, then feel free to contact us.