Polish Limited Liability Company: Online Registration vs. Notary?

When you search “how to set up a Polish limited liability company,” nearly every guide points you in the same direction: the S24 online registration system. Fast, fully digital, no need to leave your home, at a fraction of the cost of a notary visit. Sounds like an obvious choice. The problem is that what seems obvious at the start often stops being obvious after a year or two of running the business.

As lawyers, we observe a recurring pattern. An entrepreneur sets up a company through S24 because that’s what friends, the accountant, and the internet recommended. A dozen months later, they come to our firm with a problem: they want to bring in a new shareholder, but on different terms than the existing ones. Or it turns out that one of the shareholders wants to sell their shares to someone the others don’t approve of. Or a shareholder dies and suddenly their heirs appear in the company. The solution? Amending the articles of association. At a notary’s office. For money that had to be spent anyway – except now with additional legal fees, because the situation has had time to get complicated.

The Myth of the Universal Solution

The S24 system was created to simplify procedures. And it does simplify them – but simplification comes at a price. The system offers ready-made templates that cover the most basic scenarios. If you’re setting up a single-member limited liability company or a simple two-shareholder company with equal shares and equal rights, where everyone contributes only cash – S24 will suffice.

The problem arises when your situation deviates from this template. And it deviates more often than you might think.

Take a simple example: two shareholders set up a company. One brings the idea, the contacts, and will manage the business day-to-day. The other contributes most of the capital but is meant to be a passive shareholder. Should they have equal rights? Probably not. The first one should have greater operational control; the second should have protection for their investment and clear exit rules if the business doesn’t go their way. You cannot draft such an agreement in S24.

What You Lose by Choosing a Template

The articles of association are not a formality to tick off. It’s a document that governs the relationships between shareholders for the entire duration of the company’s existence. The S24 template is silent on matters that often prove crucial.

You cannot establish preferential shares – neither regarding voting rights nor dividends. You cannot introduce effective restrictions on share transfers. Yes, the template allows you to indicate that transfer requires company consent, but it doesn’t allow you to specify detailed rules: pre-emption rights for remaining shareholders, price determination mechanisms, consequences for violating these rules.

You cannot regulate the inheritance of shares. Under a standard S24 agreement, a deceased shareholder’s shares go to their heirs – all of them, according to inheritance law. You might wake up one day as a co-shareholder with your former business partner’s spouse, children, and mother-in-law.

You also cannot provide for supplementary contributions that allow financing the company without increasing share capital. You cannot introduce a mechanism for compulsory redemption of shares in case of specific events. You cannot adapt the rules governing the management board to the specifics of your business.

The Question of Non-Cash Contributions

There’s another aspect that disqualifies S24 in many situations: through the system, you can only contribute cash.

If you want to contribute real estate, a vehicle, machinery, a trademark, a patent, know-how, shares in another company, or an entire enterprise to the company – you must go to a notary. No exceptions, no workarounds.

This is not a rare situation. Entrepreneurs often transform a sole proprietorship into a company and want to contribute the existing business assets. Or they join forces – one contributes capital, the other contributes workshop equipment or software rights. In such cases, S24 is ruled out from the start.

The Cost Calculation Nobody Does

Let’s say you set up a company through S24. You save about 1,000–1,500 PLN compared to setting up at a notary’s office. Two years later, it turns out you need to amend the articles of association – to introduce share transfer restrictions because an investor has appeared who requires this. You go to the notary, you pay for the amendment. But first, you pay a lawyer to prepare this amendment, because now the situation is more complex: the company is operating, has a history, obligations, perhaps unresolved issues between shareholders.

Total cost? Often many times what you saved at the beginning. Not counting the time, stress, and potential conflicts between shareholders who suddenly have to negotiate rules they should have established before setting up the company.

When S24 Makes Sense

We’re not claiming that S24 is a bad solution. It’s a bad solution applied thoughtlessly, as the default option for everyone. However, it works well when:

• You’re setting up a single-member limited liability company and contributing cash. You have no shareholders, there’s nothing to negotiate.
• You’re setting up a company with someone you fully trust and share an identical vision with, your shares are equal, you’re only contributing money, and you don’t foresee complicated scenarios in the future.
• You need a company quickly – for example, for a specific project or tender – and you know you’ll be modifying its structure later anyway.
• You’re testing a business idea and don’t want to invest in full legal services at the start, accepting the risk that some things will need to be fixed later.
• Conclusion

“Fast and cheap” is a tempting slogan. But the decision about how to set up a company shouldn’t stem from what’s fastest and cheapest, but from what’s appropriate for your situation. A limited liability company is a tool – and you choose a tool for the task, not the other way around.

If your situation is simple, S24 will suffice. If you have shareholders, different types of contributions, development plans, potential investors, or simply want to be sure that the articles of association protect your interests – an hour’s conversation with a lawyer and a visit to the notary is an investment, not a cost.

Because the cheapest solution isn’t the one that costs the least at the beginning. It’s the one that costs the least over the entire period of running the business.