Project for strengthening surveillance in capital companies.

31.08.2020 r.

Project for strengthening surveillance in capital companies.

In accordance with the proposed changes contained in the project of the Act amending the Act – the Code of Commercial Companies and certain other acts, new regulations are going to be introduced in capital companies with the view to strengthen surveillance in capital companies.

The proposed changes should increase the efficiency of corporate supervision carried out by the supervisory boards of capital companies, and this in turn could contribute to reducing the risk associated with the business activities of these entities, as well as eliminating recurring cases of abuse related to the business operations of companies.

The grounds for the proposed change (which are available on the website of the Government Legislation Centre) indicate that it is the body of the supervisory boards which will exercise all ongoing supervision over the activities of capital companies. Granting supervisory boards of capital companies additional controlling powers could, therefore, contribute to an improvement of the perception of these entities from the perspective of domestic and foreign capital donors.

The project for strengthening surveillance in capital companies includes, among other things, imposing the obligation to provide specific information to the supervisory board by the management board upon the management board’s own initiative; the right of the supervisory board to request the preparation or submission of information, documents, reports, or explanations; the introduction of an advisor to the supervisory board; the requirement to obtain the consent of the supervisory board in order to conclude any transaction of significant value, as well as the introduction of the principle of a business assessment of a given situation.

The draft of the Amendment to the Commercial Companies Code was submitted for public consultations on 5^th August 2020 and these consultations will last for 45 days from the date of publication of this draft in the Public Information Bulletin. However, according to the content of Article 6 of the Amendment to the Commercial Companies Code, this act will enter into force three months after its announcement.

 

/ADK/