Seizure of Company Assets Without a Court Judgment
The Constitution of the Republic of Poland guarantees that forfeiture of property may occur only on the basis of a final court judgment. Meanwhile, Polish law provides for a range of mechanisms enabling the effective seizure of company assets without a judgment — as security for future claims or within proceedings concerning anti-money laundering. Understanding these mechanisms is fundamental to effective protection of a business.
What Is Seizure of Company Assets Without a Judgment
Seizure of company assets without a judgment is a temporary restriction on an entrepreneur’s right to dispose of assets, which occurs before a final resolution of the case. It may take the form of:
- property security in criminal proceedings (Article 291 of the Code of Criminal Procedure)
- security for tax liabilities (Article 33 of the Tax Ordinance)
- account blocking under anti-money laundering regulations
- blocking of funds in an account as “physical evidence” / Order recognising funds as physical evidence
Each of these mechanisms serves a different purpose, but the effect on the entrepreneur is often similar: loss of access to funds necessary for conducting business.
Property Security in Criminal Proceedings
Legal Basis and Prerequisites
Under Article 291 § 1 of the Code of Criminal Procedure, property security may be applied when the accused is charged with an offence punishable by a fine, forfeiture, monetary payment, or compensatory measure. The condition is a justified concern that without security, enforcement of the future judgment will be impossible or significantly impeded.
The Constitutional Tribunal in its judgment of 6 September 2004 (SK 10/04) confirmed the constitutionality of this institution, indicating that:
- security is temporary in nature,
- it serves to guarantee the enforceability of court judgments,
- it does not violate the essence of property rights.
Time Limits
Property security may be applied from the moment charges are brought until the judgment concluding the proceedings becomes final. This is crucial information for entrepreneurs: a property security order is not equivalent to conviction and is subject to appeal.
Security for Tax Liabilities
How It Works
Article 33 of the Tax Ordinance allows for security of a tax liability before the payment deadline if there is a justified concern that it will not be met. The prerequisites include in particular:
- persistent failure to pay due public law liabilities,
- undertaking activities involving disposal of assets that may impede enforcement.
Security may also extend to the joint property of spouses — pursuant to Article 29 § 2 of the Tax Ordinance.
Security over Third-Party Assets
Article 33b of the Tax Ordinance extends the possibility of security to the assets of:
- payers and collectors,
- management board members of limited companies (Article 116 of the Tax Ordinance),
- partners of partnerships (Article 115 of the Tax Ordinance),
- VAT taxpayers jointly and severally liable for contractors’ arrears.
This means that seizure of company assets without a judgment may affect not only the entrepreneur himself but also persons connected with the business.
Account Blocking in Connection with Suspected Money Laundering
Legal Basis
The Act of 1 March 2018 on Counteracting Money Laundering and Terrorism Financing authorises the suspension of transactions or blocking of an account for a period of up to 6 months in case of suspicion of connection with money laundering or terrorism financing.
Time Limits
Under Article 89(7) of the Act, the block lapses if a property security order or an order concerning physical evidence is not issued within 6 months. This provision constitutes an important procedural safeguard — the authority cannot indefinitely hold an entrepreneur’s funds without taking further procedural steps.
Means of Defence Against Seizure of Company Assets Without a Judgment
Appeal Against the Order
A property security order may be appealed to the court. Judicial review covers:
- the validity of the decision (existence of prerequisites),
- the scope of evidence used by the authority,
- the proportionality of the measure applied.
Application to Lift Security
Article 291 § 4 of the Code of Criminal Procedure requires security to be lifted immediately in whole or in part when the reasons for its application cease to exist. The entrepreneur should actively monitor the course of proceedings and file applications for lifting as soon as grounds arise.
Opposition to Enforcement
Where security is converted into enforcement, an action under Article 840 of the Code of Civil Procedure is available, allowing the enforcement title itself to be challenged.
Asset Protection Against Seizure — A Strategic Perspective
Time as a Critical Variable
The brilliant military strategist Helmuth von Moltke maintained that mistakes made at the stage of strategic deployment cannot be corrected during the campaign. In asset protection, this principle applies with full force.
Protective structures must be established before a threat materialises. A transfer of assets made in the face of proceedings may be challenged as action to the detriment of creditors. A foundation established the day before a security order will protect nothing.
Multi-Layered Architecture
Effective protection against seizure of company assets without a judgment requires a systematic approach:
First layer: Proper corporate structure separating business risk from personal assets — limited companies, transformations.
Second layer: Diversification of assets across jurisdictions, with full tax transparency.
Third layer: Legal instruments — family foundations, investment policies, holding structures.
Fourth layer: Procedural knowledge — familiarity with means of defence and deadlines for filing them.
Limits of Asset Protection
There is a fundamental difference between legal asset protection and hiding assets from legitimate claims. Crossing this line leads to criminal liability under Article 300 of the Criminal Code (fleeing with assets from creditors) or Article 299 of the Criminal Code (money laundering).
Summary
Seizure of company assets without a judgment constitutes a significant interference with property rights, which nevertheless finds justification in the need to secure future claims of the state or aggrieved parties. An entrepreneur should:
- Know the legal basis and prerequisites for applying security measures.
- Build protective structures in advance, at a time when no threat yet exists.
- Actively use means of appeal.
- Remember the limits of legality in protective actions.
Sun Tzu wrote: “The supreme art of war is to subdue the enemy without fighting.” In the context of asset protection, this means that the most effective defence against seizure is legal architecture built before anyone knocks on the door.
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Founder and Managing Partner of Skarbiec Law Firm, recognized by Dziennik Gazeta Prawna as one of the best tax advisory firms in Poland (2023, 2024). Legal advisor with 19 years of experience, serving Forbes-listed entrepreneurs and innovative start-ups. One of the most frequently quoted experts on commercial and tax law in the Polish media, regularly publishing in Rzeczpospolita, Gazeta Wyborcza, and Dziennik Gazeta Prawna. Author of the publication “AI Decoding Satoshi Nakamoto. Artificial Intelligence on the Trail of Bitcoin’s Creator” and co-author of the award-winning book “Bezpieczeństwo współczesnej firmy” (Security of a Modern Company). LinkedIn profile: 18 500 followers, 4 million views per year. Awards: 4-time winner of the European Medal, Golden Statuette of the Polish Business Leader, title of “International Tax Planning Law Firm of the Year in Poland.” He specializes in strategic legal consulting, tax planning, and crisis management for business.
