Four Procedural Traps When Buying Shares in a Polish sp. z o.o.

In Polish M&A, “procedural traps” are not just commercial risks; they are formal legal requirements whose breach can render a share transfer void or ineffective, or even trigger personal liability for the buyer or the management board. Because many of these requirements are purely formal (notarisation, entries in registers, consents, filings), they are easy to overlook in cross border transactions where parties tend to focus on price and warranties.
 
Why these simple, procedural issues are so important for investors? Because they affect the validity of the share transfer.
 
Here are the most common procedural traps:
 
Trap 1: ignoring restrictions on share transfer in the articles of association; assuming shares can be freely sold without checking the company’s articles of association.
 
Trap 2: skipping or superficial due diligence on the share title and KRS data; relying only on a KRS extract without checking: whether the seller is the true owner of the shares.
 
Trap 3: preparing wrong power of attorneys for people who sign the share transfer documents; lack of cooperation between lawyers from various jurisdictions in preparing and executing the POA.
 
Trap 4: overlooking the requirement that title to the shares passes to the buyer only if both parties sign the agreement with notarised signatures; assuming that any defects in the share transfer or in the powers of attorney can be cured later and given retroactive effect by backdating documents.