The newest and still little-known form of doing business in Poland is the PSA, the Simple Joint Stock Company because it is referred to combines the interesting advantages of limited liability companies and partnerships.
We have many advantages of this form of doing business but I will try to present some of the most important ones.
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No mandatory Social Security- It is common for entrepreneurs to use limited liability companies when one shareholder is a minority. Unfortunately, such companies were sometimes interpreted as sole proprietorships with a fictitious minority shareholder, which could result in a retroactive demand for Social Security contributions. In the case of a PSA, there is no such danger, and Social Security is paid only by the board of directors as a percentage of the payout just as in the case of a limited liability company.
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Low Initial Capital- One of the biggest advantages of a PSA is the low required share capital. With a PSA, the minimum capital is only 1 zloty. In comparison, the minimum capital required for a traditional Joint Stock Company is 100,000 zlotys. This makes the PSA accessible to many entrepreneurs who do not have such large start-up capital. In addition, shares can be subscribed for in exchange for labor contributions, which is unique in Poland.
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Liability as in a limited liability company. – In the case of a PSA, shareholders’ liability for the company’s debts is limited to the amount of their contributions. This means that in case of bankruptcy of the company, shareholders are not liable beyond their contributions. This is a very favorable solution for entrepreneurs who do not want to risk their private assets.
In conclusion, the Simple Joint Stock Company is an excellent choice for entrepreneurs who want to conduct their business in Poland. It allows for easier capital raising, offers low share capital and simple registration procedures, as well as flexibility in conducting business. As a result, entrepreneurs can take advantage of the benefits offered by a PSA and more easily expand their business in the Polish market.
