Is it indispensable that the manager of a branch be at the same time an employee allocated to that branch? And is it possible to have more than one branch manager? If so, can they be required to act jointly on behalf of the branch?
As per Sec. 503 (2) of the Civil Code, the branch manager represents the entrepreneur in all matters pertaining to the branch. However, this power of representation only applies as of the day on which the branch manager has been entered in the Commercial Register.
As the entrepreneur establishes a branch office or, as it were, decides to have such branch entered in the Commercial Register, a number of questions may arise concerning the branch manager.
One of these questions – indeed not at all an infrequent one in practice – is whether a plurality of branch managers is possible, and whether one may bind them by the requirement that they act jointly (which is typical for the statutory – executive – body or for authorized clerks, and which is known as the four-eyes principle). No prohibition of such practice follows from the law; moreover, one may infer by analogy that such an arrangement is permitted, with a view to the rules for other types of representation which expressly anticipate that several representatives will be installed and that the manner in which they represent the company or the principal will be determined.
Until recently, there was a practical obstacle to the appointment of more than one branch manager: the interactive form for creating the motion for entry into the Commercial Register simply did not allow for this option, making a plurality of branch managers an impossibility in the light of the above-mentioned legal rule whereby the power of representation arises constitutively only upon entry in the Commercial Register. However, the ‘intelligent form’ has recently been redesigned and it is now possible to apply for the entry of several branch managers.
On a point of historical interest, the regime of the former Commercial Code (Act No. 513/1991 Coll.) did not allow for the appointment of several branch managers (cf. Supreme Court resolution 32 Cdo 505/99 of 31 August 1999).
Another question that may become relevant is whether the branch manager must always be an employee allocated to that branch? No such obligation is set out in the law, and it is fair to conclude that the branch manager thus does not have to be at the same time an employee allocated to the branch (even though this will usually be the case in practice). In any case, it is highly recommended that the relations with the branch manager be governed by a formal contract.