Increasing or reducing the share capital of a limited liability company (s.r.o.) involves more than changing the figure in the Commercial Register. It requires a shareholder decision, supporting documents and, in some cases, protection for creditors. We can help plan the procedure and prepare the documents for the notary and register.
1. Increasing the share capital of an s.r.o.
Share capital can be increased, in particular, through new cash or non-cash contributions, by increasing existing contributions or, where permitted by law, from the company’s own resources. Each method has different documentation and contribution requirements.
The general meeting normally decides on the increase by a two-thirds majority of all shareholder votes, unless the law or memorandum of association imposes a stricter rule. The decision is recorded in a notarial deed. In a single-shareholder company, the sole shareholder decides in place of the general meeting.
- We review the memorandum of association, the current contributions and the proposed method of increase.
- We prepare the documents for undertaking the contribution obligation and, if applicable, the valuation of a non-cash contribution.
- Once the legal conditions are met, we arrange filing of the application to register the increase.
2. Reducing the share capital of an s.r.o.
A capital reduction may be used to cover a loss, change the company’s financial structure or for other lawful reasons. The general meeting resolution must state the new amount of share capital and how the reduction amount will be treated, among other matters. The decision normally also requires a notarial deed.
A reduction may require notice to creditors and compliance with the rules protecting their claims. A capital reduction does not automatically result in a payment to shareholders. First assess the purpose of the reduction and whether the legal conditions are met.
3. Documents and entry in the Commercial Register
Prepare the current memorandum of association or deed of foundation, a list of shareholders and contributions, the proposed new share capital and details of whether cash contributions, non-cash assets or the company’s own resources will be used.
Depending on the method, submit a notarial deed, declarations undertaking contributions, proof of payment, any expert valuation or documents on creditor protection. Enter the proposed change in the Commercial Register. The usual fee for a court-registered amendment is CZK 2,000and for direct registration by a notary it is CZK 1,000 plus the notary’s fee.
4. Related company changes
A capital change may affect the size or proportion of ownership interests. In that case, consider any related change of shareholder or transfer of an ownership interest. For other services, see our overview of company changes.
We can help you prepare the change
Send us the current share capital, the proposed new amount and the current founding document. We will confirm the procedure, required documents and our fee.
Information about the legal procedure: BusinessInfo.cz – share capital of an s.r.o. and Public Administration Portal – amending a register entry.