All Companies Will Be Obliged to Adjust Their Foundation Documents

2013-03-01
On 1 January 2014, the Act on Business Corporations should come into effect, replacing the currently-existing regulations on business companies and associations stipulated by the Commercial Code.

With regard to the new regulation, it is crucial to pay attention to the temporary provisions that determine how the new regulations will be applied.

As a general rule, the relevant rights and obligations shall comply with the amended regulations from the date on which the regulations come into force. The specific temporary regulations relate to, for instance, the content of foundation documents.

Companies opting for minimal adjustments to their foundation documents made solely in such a scope to meet the requirements of the temporary regulations will find themselves in a situation in which their foundation documents will be a mixture complying with both the old and new regulations. This will result in the inability to determine exactly the content of companies’ association contracts, which will cause a high degree of uncertainty.

Moreover, in the event that companies do not adjust their contracts of association according to the amended regulations within six months from the amended regulations’ date of effect and if they do not file these to the collection of deeds, companies will face significant sanctions. In extreme situations, such companies may be dissolved and put into liquidation by the courts.

You can read the complete version of the article in the newsletter “The New Codes Guide“. You can apply via email at info@ambruzdark.com if you wish to obtain a copy of the newsletter.