For nearly four years, entrepreneurs in Poland have had the opportunity to establish a Simple Joint- Stock Company (prosta spółka akcyjna – P.S.A.). In that time, approximately 4,700 companies of this
type have been registered.
One of the contributors to the development of the P.S.A. regulations was Dr. Marcin Mazgaj, legal counsel and partner at JWMS law firm.
Initially designed with start-ups in mind, the P.S.A. combines features of both limited liability companies and joint-stock companies while introducing flexible solutions not available in either
traditional form.
But why are so many entrepreneurs choosing the P.S.A.? Let’s explore the main advantages.
1️ Flexibility
Unlike Polish LLC (spółka z ograniczoną odpowiedzialnością) and joint-stock companies (spółka
akcyjna), the P.S.A. provides extensive freedom in shaping shareholders’ rights.
✅ You can assign significant voting power to certain shareholders or grant others larger profit shares.
✅ Founder shares can prevent dilution, maintaining voting power even when new shares are issued.
✅ Silent shares (without voting rights) are also allowed.
Additionally, instead of a Management Board, the P.S.A. can operate with a Board of Directors comprising executive and non-executive directors—a structure popular in the U.S. and U.K.
2️⃣ Simple and Affordable Formation
Setting up a P.S.A. is both quick and cost-effective:
✅ Online registration is possible (as is the case with other companies),
✅ You only need 1 PLN in share capital to register (compared to 5,000 PLN for LLCs and 100,000 PLN for joint-stock companies).
Note: P.S.A.s must appoint an entity to maintain the shareholder register, a requirement not found in LLCs.
Note: while P.S.A. can be registered on-line it is not possible to register any changes using the S24 system – so e.g. issuing shares will require a notary.
3️⃣ Easy Transfer of Shares and other formalities
Transferring P.S.A. shares is significantly simpler:
✅ Requires only a documentary form (e.g., a PDF with a scanned signature).
✅ No need for notarized signatures or complex legal procedures.
✅ in many cases powers of attorney and other documents also require only documentary form (so it is easier to e.g. organise shareholders meeting).
This streamlined process may be an advantage for international shareholders and minimizes legal hurdles.
4️⃣ ESOP-Friendly Structure
For businesses aiming to retain talent, Employee Stock Option Plans (ESOPs) are vital.
✅ Unlike LLCs, the P.S.A. allows for conditional capital increases and flexible share allocations.
✅ Recent tax law changes have also made it easier to offer shares below market value without
unfavorable tax consequences.
5️⃣ Simplified Dissolution Process
Should the need arise to close the company, P.S.A. regulations allow for an expedited dissolution
process, subject to court approval.
Although the court must verify compliance with requirements, this procedure may be faster than traditional methods (still, in practice, getting the court approval may take so much time that it will not make much difference).
6 No social security contributions from sole shareholder
P.S.A. has not been created with assumption that it will be used for shareholders owning 100% of shares. However, such situation is possible.
In case of LLC – Spółka z o.o. one person can also own all the shares. However, if such shareholder is a natural person (so – a human being, and not e.g. another corporation) then they have to pay social
security contribution every month (the amount changes every year).
This rule does not apply to sole shareholders of P.S.A.
⚖️ Conclusion: Is the P.S.A. Right for You?
The Simple Joint-Stock Company (P.S.A.) offers:
Flexibility in governance and profit-sharing
Minimal capital requirements
Simplified legal processes
Compatibility with modern business practices like ESOPs
Main disadvantage is the fact that P.S.A. is a new type of company. This means that the interpretation of law that regulates it is not as stable as it is with other companies. This can lower the interest of some investors who already know how to work with spółka z o.o. but may need to adjust to legal issues related to P.S.A.
For those reasons, choosing the right corporate structure requires careful consideration. We recommend a detailed comparison tailored to your specific business model.
Need help deciding whether a P.S.A. is right for your business?
You can contact Jan Marczyński from JWMS law firm.
