Sometimes there is a need to entrust certain tasks and duties in a company to a third party. The first thought in such a situation is to appoint, for example, a second member of the management board. But, it is also worth considering the appointment of a commercial proxy. His duties and rights can be adjusted to the entrepreneur’s needs.
Table of Contents
- Who is a commercial proxy and who can become one?
- What is commercial representation and what are its types?
- Establishing and granting the right to commercial representation
- What rights does the commercial proxy have in the company?
- Commercial proxy and his responsibilities in the company
- How to dismiss a commercial proxy?
Who is a commercial proxy and who can become one?
A commercial proxy is a person who acts on behalf of the company. It represents an entrepreneur on the basis of a commercial power of attorney.
Such commercial representation includes the authorization to perform judicial and extrajudicial actions related to business. A commercial proxy acts directly on behalf of the entrepreneur. His actions are similar to the actions of a partner or management board. They have a direct effect on the represented entrepreneur.
So, there must be a special relationship of trust between the entrepreneur and the commercial proxy. It allows the proxy to act in the legal sphere of the entrepreneur. The condition for the existence of a trust relationship is the relevant characteristics and qualifications of the commercial proxy. They must ensure that the commercial representation is exercised in a manner that satisfies the interests of entrepreneur. For this reason, a commercial proxy may only be a natural person with full legal capacity.
What is commercial representation and what are its types?
A commercial representation requires a special type of power of attorney. It is granted by an entrepreneur subject to the obligation of entry into the Central Register and Information on Economic Activity, or into the register of entrepreneurs of the National Court Register. It includes the power to perform judicial and extrajudicial acts related to business.
There are two types of commercial representation. The first one is an independent commercial proxy. It is otherwise known as sole commercial representation. The second one is a joint commercial proxy. It includes regular and irregular joint commercial representation. Independent proxy allows for independent performance of judicial and extrajudicial acts by one proxy. A regular joint proxy is characterized by the need to act on behalf of the principal together with another proxy. In turn, irregular proxy entitles to act with another proxy, a member of the management body, or a partner in a commercial partnership.
|Type of commercial representation|
|Independent||It allows for independent performance of judicial and extrajudicial activities by one proxy.|
| Joint regular||The need to act on behalf of the principal together with another proxy|
|Joint irregular||Entitles to act with another proxy, a member of the management body or a partner in a commercial company.|
Establishing and granting the right to commercial representation
The concepts of establishing and granting a commercial proxy sometimes causes confusion among the members of the management board. It should be emphasised that those concepts are not identical. Yet, the establishment of commercial proxy is, of course, connected with its granting. So what’s the difference?
The establishment of a commercial proxy is part of the company’s internal relations. It is an act that precedes granting the right to representation. In partnerships, the decision to establish a proxy is made by way of a resolution of the partners. In capital companies — by way of a unanimous resolution of the management board. Actions focused on granting a commercial proxy to a particular person can only be taken after the commercial proxy is established.
Granting a commercial proxy is an activity that has external effects. It is performed in accordance with the rules of representation established in the company.
What rights does the commercial proxy have in the company?
Managing a company is a real challenge. Sometimes one person is not able to take care of all the issues. In such a situation, it is worth considering appointing a proxy who will take over some of the duties.
The proxy has the right and obligation to do all business-related legal and non-legal actions. But, there are some activities they can’t perform solely based on the commercial proxy. To sell the company, perform a legal transaction leading to its temporary use, and sell or encumber real estate, specific power of attorney is needed.
Commercial proxy and his responsibilities in the company
When discussing the role of a commercial proxy, it is impossible to ignore the issue of his broadly understood responsibility.
It should be emphasized that commercial proxy is not responsible for the company’s liabilities on the same basis as its management board, i.e. in a subsidiary manner. The liability of commercial proxy is connected with the principle of guilt. This means that he is only liable for his own acts or negligence towards the company. Including those that could have caused damage to the company. If he commits actions that could cause damage to the company or other entities, then he is liable for damages.
How to dismiss a commercial proxy?
We already know what it is to establish and grant a commercial proxy and how both of these activities take place. How can a commercial proxy be dismissed from this function in the company?
The removal of commercial representation is a one-side legal act. Thus, in order to do this, the principal should submit a declaration of will to the proxy. He is dismissed at the moment when of receiving the declaration. It is important that he receives it in such a way that he can get acquainted with it. There is therefore no room for any presumptions.
Importantly, it is also allowed to submit a declaration of will regarding the removal of a proxy to another person. E.g. to a contractor before whom the entrepreneur was represented by a proxy. A commercial proxy may also be removed from the register as a result of the submission of a relevant request. Of course, for practical reasons, it is justified to inform the commercial proxy about his removal from this function.
Nevertheless, the regulations don’t impose any specific form in the case of a declaration to dismiss the commercial proxy. Therefore, it is assumed that dismissal can have any form.
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