How to determine the amount of share capital?
Under french law, when establishing a company, the future shareholders must determine the amount of share capital. As a general rule, the amount of share capital can be freely decided by the legal representative and any potential partners when drawing up the company’s articles of association.
For commercial companies, previous legislation required a minimum capital depending on the company’s legal form. For example, single-member limited liability companies (EURL), as well as limited liability companies (SARL), simplified joint-stock companies (SAS), single-member simplified joint-stock companies (SASU), and general partnerships (SNC), could not have a capital lower than €1. However, under current legislation, no minimum share capital is now required.
On the other hand, public limited companies (SA) must set their share capital at a minimum of €37,000.
When the company is formed, the actual payment (verified by a share deposit certificate from the fund custodian as a public notary) of the share capital in cash is not necessarily equal to the amount of share capital specified in the articles of association. However, for limited liability companies (SARL), this payment must be at least 20% of the share capital, and at least 50% of the share capital for public limited companies (SA) and simplified joint-stock companies (SAS).
Moreover, in the case where the full share capital is not paid to the company at the time of its formation, the remaining contributions must be made to the company’s bank account within five years of its creation.
The public notary office Chassaint & Cerclé Notaires assists business creators with the necessary steps for depositing their company’s share capital. For more information, click here.
