The statute of a family foundation: what it must contain and what you must decide before you go to the notary

A statute is not a form

The founder adopts the statute, and the statute is drawn up in the form of a notarial deed (Article 26(1)). It is the foundation's constitutional document: it determines who benefits from the assets and on what terms, who manages them, who supervises whom and how the family resolves disputes – also when the founder is no longer there.

Template statutes usually repeat the statutory minimum. Where the statute is silent, the Act decides, and in a dispute – the court. The default solutions of the Act rarely fit a particular family, and amending the statute after the founder's death can be difficult or impossible.

What the statute must contain

Under Article 26(2) of the Act, the statute sets out:

• the foundation's name – with the designation "Fundacja Rodzinna" – and its registered office;
• the detailed purpose of the foundation;
• the beneficiaries or the method of determining them, and the scope of their entitlements;
• the rules for keeping the list of beneficiaries;
• the rules and detailed procedure for a beneficiary's waiver of entitlements;
• the foundation's duration, if it is to be fixed;
• the value of the founding fund – at least PLN 100,000 (Article 17);
• the rules for appointing and dismissing members of the bodies, their powers and duties, and the rules of representation;
• who approves the acts of the management board of the foundation in organisation, i.e. before entry in the register;
• at least one beneficiary entitled to take part in the meeting of beneficiaries;
• the rules for amending the statute;
• what happens to the assets after the foundation is dissolved, including the beneficiary entitled to those assets.

What the statute may contain

The statute may also regulate other matters (Article 26(3)) – among others, the rules of cooperation between the bodies, the detailed circumstances of dissolution and guidelines for investing the assets. It may also establish a supervisory board, which becomes mandatory only where there are more than 25 beneficiaries (Article 64(2)).

In practice, it is the optional provisions that distinguish a statute that protects the family from a statute that merely meets the registration requirements.

Five areas in which the decisions are made

With every founder I go through thirty decisions that make up the statute – from the foundation's name to its dissolution. They fall into five areas.

I. Purpose and identity

Why the foundation exists, how long it is to operate and with what assets it starts. The purpose sets the limits of everything the management board will do with the assets over the coming decades.

II. Beneficiaries

Who benefits from the assets, to what extent and on what conditions – including people not yet born and those who will join the family by marriage. This is where most family disputes begin.

III. Assets and investment

Who decides on the most important assets – the company, real estate, savings – and within what limits. The tax consequences of distributions to the family also depend on this part.

IV. Bodies and power

Who runs the foundation today and who will after you; who supervises whom and what happens when the founder can no longer act. The Act provides default solutions here that rarely fit a particular family.

V. Changes, conflicts, the end

How the statute is amended, how the family resolves disputes and when the foundation comes to an end. These provisions are written with the day in mind when the founder is no longer at the table.

How I work on a statute

Information on the practice of the profession of radca prawny

1. Initial consultation. We establish whether a foundation makes sense for you and which assets it would cover.
2. Thirty decisions. We go through them together, at your pace, often with your spouse. For each one I discuss the possible solutions and their consequences. Most have no single right answer – they have an answer that is right for your family.
3. Draft statute. I draft the statute from your decisions, not from a template. If you work with a tax adviser, I agree the structure with them before the visit to the notary.
4. Notary and register. With the final draft you go to the notary, and then we file the application for entry in the register (setting up, step by step).