The amendments introduced by the Act of December 16, 2016 on amendments to certain Acts aimed at improving the legal environment of entrepreneurs (Journal of Laws of 2016, item 2255), a part of provisions of which entered into force already on 1 January 2017, pertain to, in addition to amendments regarding i.a. an irregular proxy, also to additional obligations which were imposed by the legislator on members of the board of limited liability companies and joint stock companies.

The amendment in question applies respectively to art. 209 KSH – in relation to limited liability company and art. 377 KSH – in relation to joint stock company.

Hitherto wording of the above provisions was as follows: “In the case of a conflict of interest of a company with the interest of a member of the board, his or her spouse, blood relatives and close relatives to the second degree and persons with whom he or she is personally related, then the member of the board should refrain from participating in the settlement of such cases and he or she may request that it is indicated in the minutes.” Now, the wording of the above provisions is as follows: “In the case of a conflict of interest of a company with the interest of a member of the board, his or her spouse, blood relatives and close relatives to the second degree and persons with whom he or she is personally related, then the member of the board should disclose the conflict of interest and refrain from participating in the settlement of such cases and he or she may request that it is indicated in the minutes.”

The above amendment imposes an additional obligation on the board member. The new regulations oblige a board member to disclose his or his relatives’ conflict of interest  with the company’s interest. It is not enough, as it has been so far, to simply refrain from participating in the settlement of a given case.

According to the justification of the aforementioned Act, the introduced amendment “aims at increasing the transparency of management of companies in the event of a conflict of interest, and consequently at a better protection of a corporation and its shareholders”.