Who can make decisions about the operation of the company?
The decision-making process in a company depends primarily on its internal structure and the legal form in which it operates. It can operate both by natural persons, partners, and by the body that represents it, e.g. the management board. Who can make decisions about the operation of the company? Answer below.
Decisions regarding the operation of the company and sole proprietorship
In the case of sole proprietorship, decisions regarding the company's operation are made by a natural person - the owner of the company. It is he who chooses the subject of the activity performed, acquires contractors, performs contracts, and fulfills public-law obligations.
Of course, the entrepreneur may grant a power of attorney or procuration, which authorizes third parties, e.g. employees, to represent the company externally or to take actions aimed at internal development.
Pursuant to Art. 98 of the Civil Code, the general power of attorney includes the authorization to perform ordinary management activities. For activities exceeding the scope of day-to-day management, a power of attorney specifying their type is required, unless the law requires a power of attorney for a particular activity.
Another type of power of attorney is a proxy. Pursuant to Art. 1091 § 1 of the Civil Code, it is a power of attorney granted by an entrepreneur subject to the obligation to enter into the Central Register and Information on Economic Activity or to the register of entrepreneurs of the National Court Register, which includes authorization to perform judicial and extrajudicial activities related to running an enterprise.
Jan Kowalski runs a sole proprietorship - a fruit and vegetable wholesaler. He gave the employee a power of attorney to represent his interests outside and conclude contracts with contractors - fruit and vegetable producers. The employee, as a representative authorized to conclude contracts, influences the company's operations and acquires new contractors, thanks to which it generates profits for the company.
Decisions regarding the operation of the company and a commercial company
Both in partnerships and capital companies, partners play a key role in taking actions and decisions in a company.
In the case of a general partnership, each partner may, without prior resolution of the partners, conduct matters not exceeding the scope of ordinary activities of the partnership.Each of them also has the right and obligation to run the company's affairs.
It is also possible to limit the shareholders' ability to take actions for the company. Conducting its affairs may be entrusted to one or more partners, either pursuant to the articles of association or pursuant to a subsequent resolution of the partners. The rest of them are then excluded from running the company's affairs.
In the case of a partnership, as in a general partnership, each partner has the right to represent the partnership on their own, unless the partnership agreement provides otherwise.
On the other hand, depriving a partner of the right to represent the company may, pursuant to Art. 96 § 2 of the Commercial Companies Code, take place only for important reasons by a resolution adopted by a majority of three-fourths of votes in the presence of at least two-thirds of the total number of partners. The articles of association may provide for more stringent requirements for adopting a resolution.
The partnership agreement may provide that the management board is entrusted with running the affairs and representing the company.
In a limited partnership, the partnership is represented by general partners who have not been deprived of the right to represent the partnership under the partnership agreement or a valid court decision. The limited partner may only represent it as a proxy.
In the case of a limited joint-stock partnership, each general partner has the right and obligation to run its affairs. Its articles of association may provide that the management of the partnership's affairs is entrusted to one or more general partners.
The limited liability company acts by the management board as a body authorized to represent. Managing the company's affairs and deciding on the direction of its activities belongs to the partners, or more precisely to the shareholders' meeting.
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Pursuant to Art. 228 of the Commercial Companies Code, a resolution of the shareholders' meeting requires:
review and approval of the management board's report on the company's operations, financial statements for the previous financial year and acknowledgment of the fulfillment of duties by members of the company's bodies;
a decision regarding claims for compensation for damage caused in the course of setting up the company or in the exercise of management or supervision;
sale and lease of the enterprise or its organized part and establishment of a limited property right thereon;
purchase and sale of real estate, perpetual usufruct or a share in real estate, unless the articles of association provide otherwise;
reimbursement of subsidies;
conclusion of the contract referred to in art. 7 (dependency ratio).
Both the adoption of the resolution on the approval of the financial statements and on the approval of the financial statements is an obligatory item on the agenda of the ordinary shareholders' meeting. Failure to include these items on the agenda would violate Art. 231 § 1 of the Commercial Companies Code.
Regulation of a right or incurring an obligation to pay a performance of twice the value of the share capital requires a resolution of the shareholders, unless the articles of association provide otherwise. The provision of Art. 17 § 1 of the Commercial Companies Code.
In the light of the purpose of the regulation contained in Art. 230 of the Commercial Companies Code, which is the protection of partners and the company against irresponsible actions of members of the management board, there is no justification for the application of Art. 230 of the Code of Commercial Companies and Partnerships to sole proprietorships in which the shareholder is also the only member of the management board, as his activities may only be harmful to him.
In addition, an agreement for the purchase of real estate or a share in real estate or fixed assets for the company for a price exceeding one quarter of the share capital, but not less than PLN 50,000, concluded within two years from the date of registration of the company, also requires a resolution of the shareholders, unless the agreement was provided for in the articles of association.
Additionally, the influence of partners on the company's operations is manifested by the right of a partner or partners representing at least 1/10 of the share capital, they may request that an extraordinary meeting of shareholders be convened and that certain matters be placed on its agenda. Such a request should be submitted in writing to the management board no later than one month before the proposed date of the shareholders' meeting.
Similar regulations are reflected in a joint-stock company.