Shielding Directors: Navigating Personal Liability in Times of Financial Turmoil and Insolvency

In the tangled world of corporate governance, different jurisdictions put their own distinctive spin on the role of directors in management and overseeing their company’s business, as well as their obligations towards the company, its stakeholders, and for adherence to regulatory requirements.

Shielding Directors

For directors, a thorough understanding and awareness of their responsibilities is essential to navigate the company’s affairs in a manner that safeguards both the company’s interests and their own interests. After all, their decisions during financial turmoil could come back to bite them with personal liability and criminal charges.

One rule that transcends borders? Don’t keep the ship sailing if it’s already sinking.

Sure, each jurisdiction has its own nuances, but avoiding wrongful trading is the unifying factor in upholding trust in our market-driven economy.

Find out more about Navigating Personal Liability in Times of Financial Turmoil and Insolvency from publication by Robert Nogacki, founder and managing partner of Skarbiec Group of Law Firms:

Shielding Directors_Navigating Personal Liability in Times of Financial Turmoil and Insolvency – PDF

Table of contents

1. Deciphering the Role of Directors in Corporate Governance
2. Possibility of personal responsibility for members of the Management Board under laws of Poland
3. The legal underpinning for the subsidiary liability of directors regarding a company’s debts.

3.1. Civil responsibility for commercial debts

3.2. Financial responsibility of directors regarding unpaid taxes.

4. Key distinctions in directors’ financial obligations between the United States and Polish systems.
5. A brief overview of the regulations surrounding directors’ responsibilities in Poland.
6. Quasi-guaranteeing nature of directors obligations
7. How the system operates in practice – the “entrapment” of directors
8. In Which Circumstances is a Board Member Not Relieved of Liability? Examples from Case Law

8.1. Lost in Translation: When Ignorance of Polish language Will Not Save You

8.2. Divided Duties, United Liability: Why Agreements concerning the division of duties  Can’t Shield Directors

8.3.    Health Hazard: The Surprising Lack of a Clear Link Between Illness and Director Responsibility

8.4.    Out of Office, but Not Off the Hook: Half Resignations and Legal Liabilities. The liability of an individual who continues to manage the company in practice after formally resigning                             from the board of directors of the company.

8.5.    The Subsidiary Liability of a Director Who Resigned from Directorship and Ceased to Act as a Director if the Company Received a Tax Decision After His Resignation.

9. The impact of liquidating the company on the possibility of transferring liabilities to members of the board.
10. The possibility of transferring responsibility according to the rules defined in Polish national law to the person managing the branch of a foreign company (or permanent establishment under tax regulations).
11. How does Polish law define the moment of company insolvency and the time frame for filing for bankruptcy?

11.1.  At what juncture does insolvency necessitate the filing for bankruptcy?

11.2.  Legal responsibility on part of directors is of formal nature

11.3.  Detailed guidelines from court rulings concerning the determination of the timing for filing for bankruptcy.

12. The risk of directors facing criminal liability for actions detrimental to creditors, related to placing a company in insolvency, for other actions and omissions related to the company’s bankruptcy.

Join free webinar

Join us for a free webinar: Insolvency and Board Member Liability in the US and Poland.

We will be talking about:

• What are the differences between the liability rules for board members of Polish and American companies? And What pitfalls does this raise for American companies?
• How can board members protect themselves from personal liability when working with Polish companies?
• How to protect a company against the insolvency of a Polish contractor or business partner?
• How to recover money from a Polish creditor?
• What to do in a situation where a Polish company that is a debtor to a Polish company declares bankruptcy?

25.06.2024 9:00-10:30 AM NY time

(3 PM Warsaw time ; 1 PM UTC)

online meeting in english

Click the baner to register