A new amendment to the Civil Code on a commercial proxy came into force and effect on 1 January 2017. The amendment pertains to the so-called joint irregular proxy.
The aforementioned proxy has been known and used in practice by the entrepreneurs for many years, now. The entrepreneurs simply would appoint one person to act as a commercial proxy and condition the validity of the company representation by a proxy on his/her acting jointly with a member of the Management Board. Doubts, however, arose in the light of the previously binding legal provisions whether such type of a proxy was admissible.
The resolution issued by the Supreme Court clarified the doubts; it was, however, of adverse effect for the entrepreneurs. In its resolution of 30 January 2015 (reference no.: III CZP 34/14) the Supreme Court ruled that it was inadmissible to register a proxy in the Register of Entrepreneurs of the National Court Register with a stipulation that such a proxy was required to act jointly with a member of the Management Board. The resolution posed an impediment to business operations of many entrepreneurs who had registered this type of a proxy in the Register of Entrepreneurs as they were forced to amend the previously adopted manner of representation.
Following the resolution of the Supreme Court of 30 January 2015, the registry courts began dismissing the entrepreneurs’ motions for the registration the aforementioned commercial proxy. The legislator, however, to help the entrepreneurs in this respect, decided to legalize the joint irregular proxy. According to the new wording of Article 1094 of the Civil Code, a commercial proxy may authorise a person to act, exclusively or additionally, jointly with a member of the governing body or a partner authorised to represent a partnership.
A joint irregular proxy has thus become an admissible manner of representation of the entrepreneur. The new amendment is to provide the entrepreneurs with possibly the widest range of options they may choose as regards the type of a commercial proxy. As a result of the amendment, the registration of one (the only) commercial proxy in the register with a stipulation that he/she may only act jointly with a member of the Management Board shall be legally allowable.
The new amendment comprises no interim provisions, which, may pose problems for the review of the motions for the registration of a joint irregular proxy based on the documents drawn up before 1 January 2017 and for its actual registration in the National Court Register. It seems that the courts should apply the new provisions to such motions, we will, however, only learn what the adopted practice is when it is actually applied by the registry courts themselves.
Author: Marcin Barłog