- Category: Capital
French company capital
What is the minimum capital?
In France, the minimum capital is €1 !
That means there is no minimum but should be consistent with your business objectives.
What are the main criteria to determine the capital amount?
Most of our clients ask us for advice when they need to decide the capital amount. As part of our company formation package, we will assist you every step of the way as well as advising you on the amount of the capital. Here are the main criteria to take into considering.
– When your company needs external financing, such as a bank loan, the bank may require that your company has a certain level of equity;
– When you launch activities that requires capital to finance the start-up such as investments, working capital, research and development;
– The capital is also a guarantee for the main partners of the company. Too low a capital can complicate the situation of the company such as shorter or advanced payment terms to pay suppliers
– Finally, the capital impact the image of the company, a low capital may raise questions about the financial solidity of your company.
How to proceed to transfer the capital?
What you need to know is that the capital amount has to be transferred by each shareholders onto an escrow account in a bank in order to prove the company value declare when you set up your company.
For example, if there are two shareholders with 50/50 shares and the capital is €1000, each one of them needs to transfer 50% of the capital, meaning €500 each.
This capital value evidence document is mandatory for your application dossier sent to the court of the Chamber of Commerce. We provide such service in most of our company formation packages.
Key things to remember: The capital is:
- the shareholders money
- locked during the company registration (usually a couple of weeks in most cases)
- returned to the shareholders once the company is created