What is the minimum capital you need to obtain your certificate of capital deposit and register your company?
To set up a company, a minimum share capital may be required. The amount depends on the type of company you wish to create. Capital meets the needs of the company and its shareholders. It is an essential element in the creation of a company, and deserves time to be properly determined. It is imperative to obtain a certificate of deposit of funds or a certificate of deposit of capital in order to register your company with the Registrar's Office. Anytime can help you with this process.
What is a company's share capital?
A company's share capital is the amount available at the time of its creation. It is made up of all the contributions made by the partners during the company's creation. Whether in cash or in kind, the sum of money thus raised must be mentioned on the company's official documents (invoices, estimates).
Obligations relating to share capital
What is the minimum amount needed to set up a company?
Only companies are required to have share capital. This requirement does not apply to sole proprietorships. So if you want to set up a microenterprise, an EI or an EIRL, you won't need any.
For companies, the amounts are as follows:
| Type of company | Minimum initial amount | Number of associates |
|---|---|---|
| EURL (Entreprise Unipersonnelle à Responsabilité Limitée) | 1€ | 1 |
| SARL (limited liability company) | 1€ | from 2 to 100 |
| SASU (Société par Actions Simplifiée Unipersonnelle - one-person simplified joint-stock company) | 1€ | 1 |
| SAS (simplified joint-stock company) | 1€ | from 2 to unlimited |
| SA (Société Anonyme) | 37,000€ without public savings 225,000€ with public savings | from 7 to unlimited |
| SNC (Partnership) | 1€ | from 2 to unlimited |
Drafting by-laws
When drafting the articles of association, the share capital must be entered. You must also specify whether the capital is fully or partially paid-up at the time the company is set up, i.e., whether cash is actually deposited in the account. If only part of the capital is paid up, you must specify the percentage.
| Type of company | Minimum percentage to be paid up on creation |
|---|---|
| EURL / SARL | 20 % |
| SASU / SAS | 50 % |
| SA | 50 % |
| SNC | in accordance with the terms and conditions set by the partners |
Blocking share capital in a dedicated account
Establishing share capital is a major step in setting up a company. Cash funds must be blocked in a dedicated bank account opened in the company's name. The bank will then issue you with a certificate of deposit of funds or a certificate of capital deposit, which will enable you to complete the registration procedures. The funds are then released on presentation of the Kbis issued to you once the company has been registered with the Registrar.
What's it for?
Define the shares of each partner
In a company created by several partners, the distribution of shares varies according to the contributions of each member. Their decision-making power within the company also depends on this distribution. One share is equivalent to one vote at the Annual General Meeting.
For example, a SARL is formed by 2 partners with a share capital of €10,000. One contributes €2,500, i.e. 25% of the capital, while the other contributes €7,500, i.e. 75% of the capital. The second partner then owns 75% of the company's shares, giving him majority voting rights. This means that the other partner has very limited decision-making power.
This example shows that it is essential to anticipate and correctly assess the impact of the distribution of shares on the life of the future company. When a partner has a majority shareholding, he or she has all the decision-making power, which can in some situations lead to conflict.
Provide an overview of the company's financial strength
For potential customers, suppliers and partners, a share capital consistent with the company's size and sector of activity is a certain guarantee, especially when the company is young.
Share capital can become a real element of communication. The information is displayed on the company's letterhead, quotations, invoices and website. This reassures the various parties involved.
Financing initial investments
Once released by the bank, the funds help finance the launch of the company. They can be used to make the first investments and/or compensate for cash shortages during the first months of business. To this end, a precise assessment of the company's needs at the start of business must be carried out in order to determine and start with sufficient share capital.
Is it important to have a high level of social capital?
Given the different roles played by a company's share capital, it's vital to think carefully about the minimum amount you need to launch your business. Even if there is no minimum capital requirement for most types of company, don't rush into creating a company with a symbolic one euro. Lacking credibility, risking financial weakness at start-up and holding back development, too little share capital can prove extremely problematic.
In the eyes of your potential partners, and especially the banks, the amount of your company's capital reflects your commitment to the project. A high level of capital demonstrates a degree of determination that will encourage them to trust you. Rest assured, share capital can change. If you can't start your business with a large amount of capital and your project doesn't require it, you may well consider starting with a small amount of capital, then increasing it later. There are several ways of increasing capital.
- Bring in new investors, which implies a change in the distribution of the company's shares.
- Inject reserves or profits from previous years.
In practical terms, legal obligations concerning company capital are only part of the problem. It's essential to ask the right questions to ensure the company's financial sustainability. This is not to say that it is impossible to create a viable company with a low initial capital, but simply that the question needs to be carefully considered.
