jurisdiction

1. Are members of the armed forces permitted to hold shareholdings in private companies, including startups, provided that they do not participate in management?

In Poland, this issue is governed by the Act of 11 March 2022 on the Defence of the Homeland (Ustawa o obronie Ojczyzny).

Under Article 337(1), a professional soldier may not serve on the governing bodies of companies, other business entities or foundations, including as a member of a management board, supervisory board, audit committee or board of directors. Importantly, this restriction is distinct from equity ownership.

Polish law does not prohibit a professional soldier from acquiring or holding shares, and no prior approval is required to do so. Article 337(2) expressly permits soldiers to participate in shareholders' meetings, reflecting the principle that where share ownership is permitted, the exercise of the associated corporate rights is likewise permissible.

A soldier may therefore be the sole shareholder of a company, provided that they do not hold a position on its governing bodies.

No statutory cap applies to the size of a shareholding during active military service. However, particular caution may be required where the company operates in the defence sector or participates in public procurement procedures.

Following discharge, additional restrictions apply for a period of three years under Article 336. Former soldiers may hold no more than a 10% shareholding in a commercial company, may not serve on corporate governing bodies and may not be employed by entities with which they had official dealings during their military service.

2. Is notification or approval required before acquiring a shareholding or establishing a company?

The acquisition or holding of shares does not require prior approval.

However, gainful employment or business activity requires the prior written approval of the soldier's commander. The commander will assess, among other things, whether the activity could conflict with military duties, undermine the prestige of the military profession or involve an entity supplying military units.

In addition, certain categories of soldiers, including professional officers, specified non-commissioned officers and members of tender commissions, are required to submit annual asset declarations to the Minister of National Defence. These declarations must disclose, among other matters, shareholdings and business activities.

3. Are there any notable limitations, thresholds or conflict-of-interest rules?

Although Polish law does not impose a statutory limit on shareholdings during active service, restrictions may arise where the company operates in areas connected to the soldier's official duties, particularly in the defence sector or in public procurement.

In addition, professional soldiers are prohibited from serving on corporate governing bodies and require prior approval for gainful employment or other active business involvement.

Following discharge, former soldiers become subject to the specific post-service restrictions set out in Article 336, including the 10% shareholding limit and restrictions on involvement with entities with which they had official dealings during their service.