Buying a Polish MIP: no change of control to clear

A MIP is an entrepreneur entered in the KNF register of small payment institutions - a rejestr dzialalnosci regulowanej, a regulated-activity register - under the Payment Services Act (Articles 117f and 117g). It is not a licensed institution and not a krajowa instytucja platnicza. It operates in Poland only: no EEA passport, and no payment initiation or account information services, because the MIP perimeter is limited to points 1 to 6 of Article 3(1).

The register itself is thin by design. Article 136d records the entry number, the entity's name, KRS and NIP numbers and address, its list of services, its agents and its branches - and nothing else. It records no shareholders, no ultimate beneficial owners and no management persons. KNF does not hold MIP ownership data, so it has nothing to vet when that ownership changes hands.

A full KIP is a different animal, and reading it first shows exactly what a MIP is not. Acquiring a qualifying holding in a KIP triggers a real prior-notification-with-veto process. A qualifying holding starts at 10% of capital or votes, or any stake giving significant influence (Article 2, point 37); fresh notice to KNF is then due before crossing 20%, 30% or 50% of votes or capital, or before the KIP becomes a subsidiary (Article 72a(1)).

KNF runs the assessment through the Banking Law machinery that the Payment Services Act borrows (Articles 25g to 25k of Prawo bankowe). It acknowledges a complete notice within two working days, may issue one information request before the fiftieth working day - which stops the clock - and must deliver any objection within 60 working days. Silence is deemed approval. The test is fit-and-proper standing, sound finances and a lawful, ML/TF-free source of funds. The two tiers sit side by side in the MIP vs KIP guide.

The sanctions have teeth. Close in breach and the voting rights on those shares cannot be exercised, shareholder resolutions carried on them are void and KNF has standing to sue to annul them; KNF may order the shares sold, and failing that fine the acquirer up to PLN 1,000,000 or withdraw the KIP authorisation (Articles 72c to 72e). None of this exists for a MIP. For a regime that gates the buyer instead - a statutory clock, deemed approval and a criminal cliff - see the UK section 178 guide.

The absence of a gate is genuinely fast for a buyer. There is no notification to file, no waiting period to sequence a deal around and no risk of a regulator objecting after you have signed. Compared with a KIP acquisition, a MIP share purchase clears no regulatory hurdle because none is set.

The same fact is the risk. KNF neither assesses nor records who owns a MIP, so you inherit no regulator-blessed clean-owner finding - nothing equivalent to a change-of-control approval that a later counterparty, bank or acquirer can lean on. Every assurance you would normally read off a regulator's decision you must instead build yourself, from the target's own records. No adviser can promise what that diligence will find.

Nothing about the light entry point relaxes the conditions of continued registration. From day one under new ownership the MIP must still satisfy Article 117h: the person managing it must carry no final conviction for the crimes that provision lists - against the administration of justice, in economic turnover, involving money or securities, terrorist financing, or profit-motivated and fiscal offences - and the entity must run working AML and counter-terrorist-financing systems.

The commercial ceilings ride with the entity too. A MIP is capped at EUR 1,500,000 on the preceding-12-month average of monthly payment turnover, agent transactions included (Article 117f(3)), and at EUR 2,000 of funds held per user (Article 117h(3)). Grow past the average and the MIP must either rein activity back in or file a separate application for a full KIP authorisation within the statutory reporting window - there is no automatic upgrade. User funds must be safeguarded under Article 117o, applying the Article 78 and 80 methods.

A MIP does owe KNF change notifications, but not for ownership. Article 117j(3) requires notice within 14 days of changes to the operating data the register cares about: organisational arrangements, the activity programme and financial plan, other business conducted, the safeguarding method, contact details and the service address. A change of control is not on that list, and it is not a ground to remove the entity from the register (Article 117n covers only cessation, death of the entrepreneur, or deletion from CEIDG or KRS).

One ownership-adjacent duty does exist: the MIP must report the initiation of criminal proceedings against a managing person within 14 days (Article 117p(1)(2)). Miss the 14-day reporting duties and the fine runs at up to PLN 1,000 a day, capped at PLN 250,000. So diligence on the incoming manager's record is not merely good practice - it maps directly onto a live reporting obligation.

Because the MIP status is nothing but a register entry tied to the entrepreneur (Article 117g), an asset deal is the wrong structure: it leaves the registration behind. The Payment Services Act is explicit that a payment institution's status does not pass to the buyer of its enterprise, nor to a new or absorbing entity on a merger or division (Article 72). To inherit the entry you buy the company itself, as a share sale, and the entity - registration, agents, safeguarding, banking - continues as the same legal person.

That is the structure behind the live Polish MIP lot: a 100% share sale of the operating entity, not a transfer of a certificate. A share sale keeps the register status intact, but it assures nothing about the counterparties around it - bank, client, processor and any scheme contracts remain subject to their own terms, notices, consents and renewed KYB. Pricing is on request.