CJEU issues revolutionary ruling on board members’ joint and several liability

On February 27th 2025 the Court of Justice of the European Union issued a landmark judgement that challenges the model of joint and several liability of the management board members. The ruling in case C-277/24 (Adjak) represents a significant shift in corporate governance and tax liability, particularly regarding the board members’ responsibility for their company’s tax arrears.

The Polish framework for joint and several liability has long been controversial as it prevented board members – during proceedings to determine their personal liability – from disputing the factual findings established by tax authorities in prior proceedings against the company.

The CJEU judgement substantially impacts the conduct of such proceedings. The Court held that a board member must be granted the right to effectively challenge the findings in proceedings against the company, as well as access to the case files from those proceedings. This decision underscores the necessity of upholding fundamental principles of EU law, particularly the obligation to ensure the right to an adequate defense.

Tomasz Michalik and Jakub Warnieło, MDDP experts, in the new article published by International Tax Review, outline the key implications not only for Poland, but also for other EU member states.

“The CJEU ruling in the Adjak case is a very important step towards ensuring tax security for board members in the EU. Questioning the Polish provisions on joint and several liability of board members, the court emphasised the importance of procedural fairness and the right to defence.

The ruling may prompt the introduction of legislative reforms in Poland. It may also lead to the introduction of changes to proceedings on joint and several liability of board members in other EU member states”.

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