Company Due Diligence in Poland: What Buyers Should Check

Company due diligence in Poland is a structured legal and business review of a target company before an acquisition, investment, merger or joint venture. Its purpose is to identify liabilities, restrictions, missing approvals and operational risks that may affect the transaction price, contractual protections or post-closing business continuity.

For international buyers, legal due diligence of a target company in Poland should not be limited to confirming that the company exists and is properly registered. The review should establish whether the seller owns the shares or assets being sold, whether the target has complied with corporate, tax, employment and regulatory requirements, and whether material disputes or reputational risks may arise after closing.

This is informational material, not legal advice. The appropriate scope of review depends on the transaction structure, sector and identified risk factors.

Setting the scope of legal due diligence of a target company in Poland

The due diligence checklist for an acquisition in Poland should be proportionate to the target’s size, sector, transaction value and risk profile. A buyer acquiring a minority stake in a software company will usually require a different review from a buyer acquiring a manufacturing business with real estate, environmental permits and a large workforce.

The starting point is normally a virtual data room. A properly managed data room in Poland should contain complete, dated and searchable documents, together with a clear index. Missing documents, inconsistent versions or unexplained gaps often become red flags in Polish due diligence.

The review should distinguish between verified facts, information provided by management and legal conclusions. Where a document is unavailable, the issue should be listed as an assumption, information request or closing condition rather than treated as resolved.

KRS and corporate documents review

A KRS and corporate documents review is a fundamental part of Polish M&A due diligence. The National Court Register provides public information on the company, including its registered office, management board, representation rules, registered share capital, shareholders or partners to the extent required for the relevant legal form, certain entries concerning insolvency-related matters and filed financial statements.

Under the Act on the National Court Register, entries in the register are generally public and third parties may rely on disclosed information, subject to statutory rules and the factual circumstances of a given case [1]. However, KRS information is not a substitute for reviewing the underlying corporate documents.

Key documents usually include:

• the articles of association or statute, together with all amendments;
• shareholder resolutions, management board resolutions and supervisory board resolutions, where applicable;
• the share register or register of shareholders, as applicable, share transfer agreements and evidence of payment for shares;
• powers of attorney and documents confirming representation;
• financial statements and management reports filed with the KRS;
• documents concerning pledges, usufruct rights, options or other encumbrances affecting shares.

Under the Commercial Companies Code, certain corporate actions require shareholder resolutions, specific majorities, notarial form or registration. Defective approval procedures may affect the validity or enforceability of a transaction or expose the company to internal claims [2].

Contracts, assets and change of control clauses

Material contracts should be reviewed for duration, termination rights, exclusivity, penalties, limitations of liability, assignment restrictions and governing law. Particular attention is required for change of control clauses. These provisions may allow a customer, lender, landlord or supplier to terminate, renegotiate or require consent following the acquisition.

Buyers should also verify ownership or lawful use of key assets, including intellectual property, real estate, machinery, domains, software licences and customer data. In an asset transaction, the definition of the transferred enterprise should be assessed against Article 55¹ of the Civil Code and the specific assets listed in the transaction documents [3].

Tax and employment due diligence in Poland

Tax and employment due diligence in Poland often reveals liabilities that are not apparent from financial statements alone. The review should cover corporate income tax, VAT, withholding tax, transfer pricing, tax audits, tax rulings, arrears and security arrangements. The Tax Ordinance regulates, among other matters, tax liabilities, audits and certain forms of legal succession [4].

Employment due diligence should examine employment contracts, remuneration rules, bonus schemes, workplace regulations, employee claims, working-time records, social security settlements and the use of contractors. In a transfer of an undertaking or part of an undertaking, Article 23¹ of the Labour Code may result in the automatic transfer of employees to the new employer [5]. This risk requires early planning because it may affect costs, information and, where applicable, consultation duties, and workforce retention.

Compliance, investigations and regulatory exposure

A buyer should determine whether the target is subject to sector-specific permits, reporting duties or supervisory requirements. Depending on the business, this may include financial, energy, pharmaceutical, transport, gambling or environmental regulation.

The review should also address anti-money laundering procedures, beneficial ownership reporting and internal compliance controls. The Act on Counteracting Money Laundering and Terrorist Financing imposes obligations on obliged institutions and establishes the Central Register of Beneficial Owners [6].

Where the transaction concerns a protected entity or a foreign investor, screening rules under the Act on the Control of Certain Investments may apply. Notification obligations must be assessed before closing, as the consequences of proceeding without required clearance or without expiry of the relevant review period may be significant [7]. Competition clearance should also be considered under the Act on Competition and Consumer Protection [8].

Three exceptions requiring separate treatment

• Asset deals: the buyer must confirm which assets, contracts, permits and employees transfer, as transfer does not automatically cover every operational element.
• Regulated businesses: licences and permits may be non-transferable, may require authority approval or may depend on the target retaining a specific management structure.
• Distressed targets: potential insolvency, enforcement proceedings or restructuring may require a separate review of creditor rights, clawback risks and transaction timing.

Red flags in Polish due diligence

Common red flags include missing corporate approvals, discrepancies between KRS entries and internal documents, unpaid taxes or social security contributions, undisclosed disputes, informal related-party transactions, incomplete employment records and contracts containing change of control restrictions.

Personal data issues should also be assessed. A data room should follow data minimisation principles and appropriate access controls, particularly where documents contain employee, customer or supplier information. Processing must comply with the General Data Protection Regulation and applicable Polish data protection rules [9].

Findings should be reflected in the transaction documents through conditions precedent, specific indemnities, price adjustments, escrow arrangements or post-closing covenants. A well-prepared due diligence report should prioritise issues by financial exposure, probability, legal impact and practical remediation options.

For transaction-specific support with company due diligence in Poland, buyers may contact us at Lawyersinpoland.com by Kopeć & Zaborowski.

FAQ – Company Due Diligence in Poland

How long does legal due diligence take in Poland?

The timeline depends on the target’s size and document readiness. A focused review may take one to two weeks, while a complex cross-border acquisition can require several weeks or longer.

Is a KRS extract sufficient to verify a Polish company?

No. KRS data is an important starting point, but buyers should also examine articles of association, resolutions, share records, financial documents and material contracts.

What are the most common red flags in Polish due diligence?

Typical issues include defective corporate approvals, tax arrears, undisclosed litigation, employee claims, missing permits and contractual change of control restrictions.

Does an acquisition automatically transfer employees?

Not always. In a transfer of an undertaking or part of it, Article 23¹ of the Labour Code may apply. The outcome depends on the factual structure of the transaction.

When is competition clearance required in Poland?

Notification may be required where statutory turnover thresholds are met. The transaction structure, parties’ turnover and applicable exemptions must be assessed under the Act on Competition and Consumer Protection.

Should a buyer review GDPR compliance during M&A due diligence?

Yes. The review should cover the target’s legal basis for processing, data security arrangements, processor agreements, data incidents and the lawful disclosure of data in the transaction process.

Bibliography

[1] Act of 20 August 1997 on the National Court Register, consolidated text: Journal of Laws of 2024, item 979, as amended.

[2] Act of 15 September 2000 – Commercial Companies Code, consolidated text: Journal of Laws of 2024, item 18, as amended.

[3] Act of 23 April 1964 – Civil Code, consolidated text: Journal of Laws of 2024, item 1061, as amended.

[4] Act of 29 August 1997 – Tax Ordinance, consolidated text: Journal of Laws of 2025, item 111, as amended.

[5] Act of 26 June 1974 – Labour Code, consolidated text: Journal of Laws of 2025, item 277, as amended.

[6] Act of 1 March 2018 on Counteracting Money Laundering and Terrorist Financing, consolidated text: Journal of Laws of 2025, item 644, as amended.

[7] Act of 24 July 2015 on the Control of Certain Investments, consolidated text: Journal of Laws of 2024, item 111, as amended.

[8] Act of 16 February 2007 on Competition and Consumer Protection, consolidated text: Journal of Laws of 2024, item 1616, as amended.

[9] Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 – General Data Protection Regulation.