Broad powers of corporate agents may lead to the creation of a group of professionals who would live off conflicts in companies - says Dr. Aleksandra Pokropek in the interview with DGP.

Minister of Justice Zbigniew Ziobro wants to solve the problem of companies’ hindering court and enforcement proceedings. Is such a phenomenon indeed a real threat?

Yes. The are instances of shareholders dismissing the company’s management board only to stay the enforcement and court proceedings conducted against it. The creditors of such a company do not know what to do and there are no laws that would regulate measures which could be taken with respect to the shareholders in order to cause the management board to be reappointed.

And it is indeed a deliberate action or rather the effect of an argument between shareholders?

From time to time real conflicts occur between shareholders due to the company’s problems and divergent concepts of business running. Unfortunately, in some cases it is a deliberate action of entrepreneurs aimed at giving the company time to improve its operations but in fact this is done to the detriment of the creditors. As a result of such actions taken by the company, the creditors cannot directly proceed to enforcement against the company’s assets. However, such a breather, from the debtor’s point of view, is a chance to attempt at restructuring activities. From the creditor’s perspective it is a very problematic situation.

According to the assumptions to the amended Act on National Court Register, those who deliberately avoid appointing bodies authorised for representation are to be fined. Would you be able to indicate when such action is deliberate and when it is the effect of a real dispute between shareholders?

Indeed, the draft assumptions provide for fines solely for completely dismissive actions of shareholders, which in fact are deliberate actions. Still, the judge may find it extremely difficult to determine such a state. The judges do not have any tools to check what exactly is going on at the company because most often they rely simply on the data from the National Court Register. However, the only information which can be found there is whether the management board exists in the company or not.

Is it not the case that in reality the fines will hit those entrepreneurs who factually are not able to reach an agreement rather than those who deliberately withhold the enforcement of claims because they still find the fine more cost-effective than immediate enforcement?

Unfortunately, that may be the case. Even the best assumptions of the Act will not take into account all the situations which may occur. It is also hard to determine how the proposed fines should operate to be effective, i.e. whether they should be fixed amounts or perhaps they should depend e.g. on the company’s or the shareholder’s annual income. In my opinion, the fine dependent on the amount of income may be more motivating since it would be more onerous to the shareholder.

The amendments will also concern corporate agents. Their position is to be stronger since they will be able to represent the company. Is this a right solution?

It would be hard to imagine the situation in which a corporate agent in fact manages the company’s affairs as the management board or a commercial proxy, e.g. by concluding new agreements or making new investments. I am not talking about situations when the potential conclusion of the agreement would be justified from the point of view of the scope of the corporate agent’s competencies. As I understand the ministry’s intentions, the corporate agent would act in a way similar as a receiver, who also has certain competencies related to managing the affairs of the bankrupt enterprise during its liquidation.

And perhaps the ministry wants to provide a motivation for appointing the company’s bodies by threatening with a corporate agent and its broad competencies?

The purpose, which the ministry wants to achieve, is very legitimate. However, if a corporate agent with a vast scope of powers is appointed, a problem may occur that the corporate agent who would receive remuneration he is satisfied with, will not want to resign from its function and will block in various ways – e.g. in cooperation with a part of shareholders – the appointment of a new body, if the appearance of the new management board were to be equivalent to him finishing his mission. With time it could turn out that the vast powers of the corporate agents led to the creation of a group of professional corporate agents who would live off conflicts in companies.

What should be the minimum requirements for corporate agents?

I would not introduce here the requirement of being an attorney-at-law or a solicitor although such persons would find the task easier. Generally, I guess it makes no sense to restrict the choice of corporate agents to a certain closed circle since it could e.g. close the career path for the so-called legal advisors and some of them surely have appropriate qualifications to act as corporate agents. ©?