Does a Limited Joint-Stock Partnership Exist “in Organisation”?

A limited joint-stock partnership constitutes a distinctive structure within commercial law, combining elements characteristic of both partnerships and capital companies. Its hybrid nature gives rise to significant doubts at the stage of formation, in particular as to whether, prior to entry in the register of entrepreneurs, it is possible to speak of a limited joint-stock partnership “in organisation”, analogously to capital companies.

The Formation Process of a Limited Joint-Stock Partnership

Pursuant to Article 126 § 1 point 2 of the Commercial Companies Code, in matters not regulated by the provisions governing the limited joint-stock partnership, the provisions applicable to a joint-stock company apply mutatis mutandis. This reference also covers regulations relating to the formation process, including the obligation to make contributions to cover the shares subscribed in the limited joint-stock partnership prior to its entry in the register.

Accordingly, the formation process of a limited joint-stock partnership is not limited solely to the adoption of the articles of association, but encompasses a number of legal and factual acts undertaken before registration. Within this process, the question arises as to the legal status of the entity to which the contributions should be made and which performs organisational acts in the period preceding the entry of the partnership in the register.

The Position of Legal Doctrine on the Existence of a Limited Joint-Stock Partnership in Organisation

The prevailing view in commercial law doctrine holds that a limited joint-stock partnership in organisation does not exist. It is argued that, under Article 134 § 1 of the Commercial Companies Code, a limited joint-stock partnership comes into existence only upon entry in the register of entrepreneurs, which excludes the possibility of distinguishing a stage in which it operates as a partnership in organisation.

It is further emphasised that there are no grounds for applying Articles 11–13 of the Commercial Companies Code mutatis mutandis to a limited joint-stock partnership. Attention is also drawn to the fact that Article 11 of the Code enumeratively provides that the status of a company “in organisation” applies only to a limited liability company, a joint-stock company, and a simple joint-stock company.

Consequences of the Adopted Position

Accepting that a limited joint-stock partnership in organisation does not exist nevertheless leads to certain practical difficulties. In particular, problems arise in identifying the entity to which contributions to cover the share capital are made, as well as in determining the legal regime governing the management of these assets prior to the registration of the partnership.

Despite these doubts, doctrine emphasises that such difficulties do not justify creating—by way of interpretation—a construction of a limited joint-stock partnership in organisation, especially given that the legislator did not expressly provide for such a form in the provisions of the Commercial Companies Code.

Summary

The dominant doctrinal position therefore assumes that a limited joint-stock partnership does not operate in legal transactions prior to registration as a partnership in organisation, and that its legal existence begins only upon entry in the register of entrepreneurs. This solution remains consistent with the literal wording of the provisions referred to above.

At the same time, it is pointed out that the absence of clear regulation concerning the pre-registration stage of a limited joint-stock partnership gives rise to significant practical difficulties. For this reason, legislative clarification of the rules governing the functioning of a limited joint-stock partnership at the stage of its formation—particularly with regard to the legal effects of acts performed prior to registration—would be desirable.