Websites of private joint-stock company or joint-stock limited partnership
Does a company or limited partnership have to have its own website? Does it have to operate the site itself? What information must be posted there? Practical pointers under the amended Commercial Companies Code
An amendment to the Commercial Companies Code entered into force at the start of 2020, imposing on joint-stock companies and joint-stock limited partnerships an obligation to operate a website and to post certain information there for stockholders (as we previously reported here).
Although the new regulation applies to all joint-stock companies, in practice it changes little for public companies, which were already subject to much more extensive requirements, and thus we do not discuss public companies further in this article.
The new regulation should be examined more closely, as it has generated (probably unintentionally) certain doubts as to what the new obligation entails.
Company must operate its own website…
Art. 5 §5 of the Commercial Companies Code provides: “A joint-stock company or joint-stock limited partnership shall operate its own internet site and shall also post there, in sections set aside for communication with shareholders, announcements from the company required by law or the articles of association.”
While the purposive interpretation of this provision seems clear (as discussed below), its literal wording may raise doubts, as it requires each company (or partnership) to “operate” a website, and it must be the company’s “own” site.
The Commercial Companies Code does not contain a definition of a website, but the definition set forth in Art. 4(10) of the Act on Digital Access to Websites and Mobile Applications of Public Entities of 4 April 2019 may be cited. According to that definition, a website is “a set of logically arranged elements, combined through navigation and links, presented with the help of a web browser at a consistent electronic address.”
In turn, another law (the Electronic Services Act of 18 July 2002) defines “electronic address” as “the designation of a teleinformatic system facilitating understanding using means of electronic communications, in particular e-mail.”
For a website to be accessible online, naturally it must be stored somewhere (at a location indicated by the electronic address). As the drafters of this amendment did not specify that to meet the requirements set forth in Art. 5 §5 the site must be stored at any particular place, it should be accepted that it may be stored anywhere. Consequently, this could be a server belonging to the company or to some other entity (e.g. a provider of hosting services). But if operating the site will require processing of personal data, when selecting the location of the server it is important to bear in mind the General Data Protection Regulation, and in particular the restrictions on transferring personal data outside the EU or the European Economic Area.
The site must operate at an “electronic address,” but in this respect the lawmakers did not specify what address this should be. URL addresses (such as https://www.example.com/) are used to designate websites and the resources accessible there. The domain is an essential part of the URL address. This could be a domain registered by the company itself, or a third party which makes the domain available to the company for its use. It should be considered permissible also to use a sub-domain (such as corporate.example.com). But it should be checked in advance that the domain name used by the company does not infringe the rights of third parties (e.g. under registered trademarks).
Furthermore, an “electronic address” as such may display varying degrees of specificity. It may be limited to indicating the domain (e.g. https://example.com/), in which case it is suggested that from the homepage it is easy to reach the “sections set aside for communication with shareholders,” particularly if it is an extensive site. The address could also refer to a specific element of the site, such as a file or folder (e.g. https://example.com/pl or https://example.com/strona.html). Any of these addresses undoubtedly qualifies as an “electronic address” for purposes of the definitions discussed above.
…or maybe not
According to the new Art. 5 §5 of the Commercial Companies Code, a website must be “operated” by a company (or partnership). Although this wording suggests that the company must itself operate (administer) its own site, it does not seem that this was the aim of the drafters, and contrary to the literal wording of this provision, this is not what the provision means. We could even conjecture that in the great majority of cases, not only hosting services (providing room on a server) but also operation of sites (in the sense of administering the site and uploading changes) is provided by external entities. Registering a domain name also requires conclusion of a contract with an external entity. In this context, a company “operates” its own site in the sense that it independently decides what will be found on the site and when, but the company nonetheless hires a specialised external entity to perform the function of administrator of the site.
The amended Art. 47(1) of the National Court Register Act requires joint-stock companies and joint-stock limited partnerships to submit to the registry court the address of their website referred to in Art. 5 §5 of the Commercial Companies Code. The address is then entered in section 2.1 of the commercial register for the company, and thus is public, and any interested person can easily determine the website (address) where the company publishes the announcements required by the law.
Thus it cannot be accepted that to ensure compliance with these regulations, the company must “operate” all on its own a website using an address from a domain registered by the company itself. To the contrary, so long as the requirements indicated in the code are met, i.e. visitors to the site can easily determine that it is the site of that company (e.g. a specific company which is part of a capital group, regardless of who is the “owner” of the site, and thus, citing the definition referred to above, the owner of the collection of data), the address of the site is indicated in the commercial register, and the site contains the required information, then the requirements of the code should be regarded as fulfilled—even if the site technically constitutes a sub-site on the website of a group of companies.
We can pursue this line of reasoning even further. The fact that the code requires a company to have a website does not mean that the company can have only one site. Often companies maintain numerous sites, devoted for example to various product lines or business segments (particularly in the case of bigger companies). For purposes of the code, basically the company should “designate” one site and publish its address by disclosing it in the commercial register. But this does not mean that apart from that site, the company cannot operate other sites as well, even if they are unconnected (not linked) to the “commercial register” site.
What must be published, and where
Under Art. 5 §5 of the Commercial Companies Code, announcements by joint-stock companies and joint-stock limited partnerships must be published “also” on their website. This means that the new obligation essentially expands the list of media where companies must publish certain information. This list still includes the judicial and commercial gazette Monitor Sądowy i Gospodarczy as well as other publications indicated in the law or the company’s articles of association.
Undoubtedly, announcements that should be posted on the company’s website include all announcements required by law and previously published in the other places mentioned above, in particular notices subject to publication in Monitor Sądowy i Gospodarczy (i.e. information entered in the commercial register), announcements required by law (e.g. a summons to creditors in the case of a reduction of share capital or liquidation), and announcements convening the general meeting of the company or partnership.
Apart from such announcements, the website should also include the entity’s basic details required under Art. 127 §5 of the code (for a joint-stock limited partnership) or Art. 374 (for a joint-stock company), i.e. its name, registered office, address, National Court Register number, registry court, tax number, share capital and paid-up capital.
Summary
Returning to the aim of the new regulation, mentioned at the start, there is no doubt that the purpose is to require joint-stock companies and joint-stock limited partnerships to publish certain information, specified in the law or the articles of association, on a website whose address is indicated in the register maintained for the company or partnership and which is accessible to all users (that is, access to the site is not controlled by a password, and does not require any special know-how or software).
The management board is charged with the responsibility of ensuring that the site is operated in compliance with the code. Failure to observe this duty may have far-reaching consequences, including liability of the management board members but also defectiveness of resolutions by the general meeting if information about the meeting was not properly posted on the site (as discussed in our earlier article).
Maciej A. Szewczyk, attorney-at-law, M&A and Corporate practice, Wardyński & Partners
Rafał Kuchta, adwokat, New Technologies practice, Wardyński & Partners
