How to Protect Yourself from Personal Liability as a Director of a Polish Company: The 12-Point Programme
This article is the closing chapter of the ebook “Shielding Directors: A Practical Guide for Foreign Directors of Polish Companies” — see the full table of contents or download the complete ebook (PDF).
Everything to this point has been diagnosis. This chapter is the prescription, a programme that follows point by point from the legal mechanics established above. None of it is exotic; all of it is the difference, observable in practice, between directors who walk away from corporate failures and directors who fund them. The deep grammar of the system is that courage is not rewarded and procedure is, so the programme is entirely procedural.
Before accepting the mandate
1. Due diligence on the company you are about to guarantee. Since accepting a Polish board seat economically resembles guaranteeing the company’s debts subject to conditions, perform the diligence a guarantor would: the last three annual financial statements (the filed statements bind the over-indebtedness assessment); aging of payables and any enforcement or tax proceedings already pending; ZUS and tax clearance certificates (zaświadczenia o niezaleganiu), cheap, fast, and revealing; and the state of the books generally, because you will need them to monitor solvency from day one. A director appointed after insolvency arose inherits a thirty-day clock that starts at appointment: if diligence reveals the company may already be insolvent, you are not negotiating a job, you are negotiating which day your filing duty begins.
2. Refuse decorative mandates. The figurehead line of authority makes “purely formal” board seats the worst risk-reward proposition in Polish corporate life: full liability, no control. If the role comes with the assurance that you “won’t have to do anything,” the assurance is the problem. Either negotiate real authority and information access, or decline.
3. Contract your information rights. Polish statute gives a board member the duty to know the company’s condition; make sure your arrangements give you the corresponding means. The appointment package should guarantee monthly management accounts and liquidity reporting; direct access to the chief accountant and the books; prompt notice of any tax control, enforcement action, or material payment default; and continuing access, after departure, to documentation concerning your period in office, plus an undertaking that the company will inform and consult you on tax decisions relating to that period.
4. Put D&O insurance in place before you need it, and read the insolvency clauses. Directors’ and officers’ insurance is standard equipment internationally and underused in the Polish mid-market. Its architecture matters more than its existence: Side A cover (paying the director directly when the company cannot indemnify) is the layer that performs in precisely this scenario, since an insolvent company indemnifies no one; Side B is irrelevant by then, and Side C protects the entity, not you. Scrutinise, with professional help, the exclusions that decide everything in a Polish collapse: insolvency exclusions, the treatment of Article 299 and Article 116 claims (statutory debt-transfer claims sit awkwardly in policies drafted for negligence suits, confirm in writing that they are covered), conduct exclusions and their final-adjudication triggers, defence-cost advancement, and the run-off (tail) period after you leave the board, which, given the three-to-twenty-year limitation horizons, should be as long as money can buy. A policy that excludes the only claims Polish directors actually face is an expensive placebo.
During the mandate
5. Institutionalise the solvency question. The single highest-value habit: a standing, minuted, monthly board review of both statutory insolvency tests, due obligations versus payment capacity (with the three-month presumption tracked explicitly) and balance-sheet position against the twenty-four-month over-indebtedness fuse. Prospectively, it converts an unanswerable hindsight question into an answerable routine. Retrospectively, it manufactures the evidence for the no-fault defence: a director who can produce eighteen months of minuted solvency reviews is in a different evidentiary universe from one who can produce optimism.
6. Document as if the trustee were reading. Every significant decision near financial stress, new debt, asset disposals, payment prioritisation, rescue negotiations, should leave a contemporaneous record of the information considered, the alternatives weighed, and the advice received. This is what the 2022 business judgment rule rewards, what the Article 296 criminal exposure fears, and what the no-fault defence requires. In a Polish corporate failure, the well-documented director and the undocumented director did the same things; only one of them can prove it.
7. Treat tax and ZUS as the senior creditors they functionally are. Not as a legal proposition, preferring them at others’ expense raises its own Article 302 question in the end-game, but as a monitoring priority: arrears to the tax office and ZUS are the exposures pursued by the one creditor that must pursue you, with the longest institutional memory and the best enforcement tools. A company quietly financing itself by not paying VAT or social contributions is writing its board’s personal liability in monthly instalments.
8. When distress appears, move the question to restructuring, early. Polish restructuring law is the system’s one genuine olive branch: a timely opened restructuring proceeding (or approved arrangement) exonerates exactly as a bankruptcy petition does, while offering what bankruptcy does not, a live business at the end. Opened early, restructuring preserves option value and stops the liability clock; attempted late, it may be refused for want of funds, leaving the board outside both safe harbours. The recurring fatal pattern is the board that negotiates informally with creditors for six months, accumulating Article 299 and Article 302 risk with every selective payment, before discovering the formal tools it could have invoked in month one.
9. In the twilight zone, stop choosing among creditors. The moment the company cannot satisfy everyone, every discretionary payment is a potential Article 302 § 1 offence whose motive is legally irrelevant. The treasury function must shift from commercial logic (“who do we need most?”) to legal logic (“who may we pay at all?”), current wages and genuinely simultaneous exchanges occupy safer ground than old unsecured debt, and the shift should be made on written legal advice, both because the lines are fine and because the advice itself is later evidence of care.
10. File on the doubt. The thirty-day deadline is short, the trigger is retrospective, the presumptions run against you, and the courts have told you that every difficulty of assessment was your problem to have solved earlier. Between the bounded costs of filing early and the unbounded costs of filing late, the rational director’s threshold for filing sits much lower than the intuitive one. The board that asks “can we still defensibly not file?” is asking the right question; the board that asks “are we definitely required to file?” is already drafting its Article 299 defence.
Leaving
11. Resign completely or not at all. The exit protocol: a written resignation delivered to the company (effective on delivery; do not let registration formalities blur the date); notification to the registry court if the company drags its feet on deregistration (you cannot file the deletion yourself, but your documented notification protects you); and total, verifiable cessation of managerial conduct from that date. No transitional signing, no instructing staff, no representing the company to the bank “while they find someone.” The half-exit collects the liabilities of office without its powers.
12. Take your evidence with you. Before access disappears: copies, within lawful and contractual bounds, of the financial statements, board minutes, solvency reviews, and advisor correspondence covering your tenure. The Article 116 decision concerning your period may arrive years later, addressed to a company that no longer answers your calls; the proceeding against you will then be winnable or unwinnable largely on the strength of the file you preserved today. Diarise the horizon realistically: three years is the working limitation period for the civil claim, longer for tax, and the twenty-year scenario, however rare, counsels keeping the archive.
The programme in one sentence
Polish law cannot be managed by courage, only by procedure: know the tests, watch them monthly, write everything down, insure the gap, use restructuring early, file on the doubt, and leave cleanly, because in this system the directors who survive corporate failure are never the boldest, and always the best documented.
Read the Full Guide
This chapter is part of the ebook “Shielding Directors: Navigating Personal Liability in Times of Financial Turmoil and Insolvency — A Practical Guide for Foreign Directors of Polish Companies.”
This article is general information, not legal advice. © Kancelaria Prawna Skarbiec
Robert Nogacki is a Polish attorney at law (radca prawny), the founder and managing partner of Kancelaria Prawna Skarbiec (Skarbiec Law Firm), which has operated continuously since 2006.
The law is equal for everyone, but the parties rarely are: on one side stands an organization with time, money, and lawyers, on the other a person with one business, one nest egg, and one life.
Clients rarely come to him with a legal problem. They come with a problem that also has a legal side: an audit that began with a single invoice, money entrusted to someone who has disappeared, a company that has to be passed on before it is too late. Most such matters are decided long before the first letter is written, in decisions made without asking and in deadlines nobody remembered. So he begins by asking how the client got here, not what the client should have done.
He advises entrepreneurs and families from more than a dozen countries, including those whose accounts the tax office has just seized and who do not know what to do tomorrow morning. He defends them in tax audits, customs and fiscal inspections, disputes with the tax authorities, and criminal tax proceedings. He represents victims of investment fraud and Ponzi schemes. He helps families set up family foundations and plan succession, so that a life’s work outlasts a single generation.
Not every case can be won. Every case can be run so that the client knows where they stand. Since 2006 he has represented the victims in the WGI case (Warszawska Grupa Inwestycyjna, the Warsaw Investment Group), one of the longest criminal cases in the history of the Polish financial market, because some things must not be left half finished, even when they take two decades. In the case of the collapsed cryptocurrency exchange Zonda (Zondacrypto, operated by BB Trade Estonia OÜ), he represents several hundred victims in the criminal investigation conducted by Poland’s National Prosecutor’s Office and in the Estonian bankruptcy proceedings.
Kancelaria Prawna Skarbiec is listed in the rankings of Poland’s largest tax advisory firms published by Dziennik Gazeta Prawna and Rzeczpospolita, and it is a four-time recipient (2015 to 2018) of the European Medal awarded by the Business Centre Club and the European Economic and Social Committee. Robert Nogacki publishes regularly, in the press and on the firm’s website, for people who have a problem rather than a law degree, because a legal opinion the client cannot understand protects only the lawyer.
He believes that the best legal advice is the kind that means the client never has to appear in court.
