Share capital in Andorra: minimum amounts, contributions and how to structure it safely

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🏗️ What you should know about share capital

Share capital is one of the essential elements of any company incorporated in Andorra and, more broadly, in any jurisdiction. It not only sets out the initial contribution of the shareholders: it also reflects the minimum solvency, the power structure and the financial capacity of a business project.

Andorra’s companies law establishes precise rules regarding minimum capital, permitted contributions, shareholder liability and the formal requirements necessary for a valid incorporation.

This article offers a technical and practical overview of how share capital works in Andorra and which decisions are advisable when starting a new corporate project.

💶 Minimum share capital under Andorran law

Under current legislation:

• Public Limited Company (SA): minimum €60,000
• Private Limited Company (SL): minimum €3,000

This amount must be stated in the articles of association and may not be reduced below the legal minimum, except in very specific circumstances provided for in the law.

➤ If you wish to examine both structures in detail, you may consult the article SA or SL company in Andorra: real differences and how to choose the right form

🪙 Types of contributions permitted by law

Legislation allows for two main categories of contribution:

💵 Cash contributions

• Made in euros
• Fully paid up at the time of incorporation
• Supported by a bank certificate issued in the name of the company being formed

🧱 Non-cash contributions

These may consist of assets or rights with an economic value, such as:

• real estate
• vehicles
• machinery
• shareholdings in other companies
• technological assets or IT equipment
• intellectual property rights

The following cannot be used as initial contributions:

• services
• personal work

Although no substantive legal restriction applies, it is important to note that notaries rarely accept a company whose initial capital is contributed entirely through non-cash assets. In practice, this option is highly unlikely to be authorised.

📝 Independent expert’s report: when is it mandatory?

For non-cash contributions, the general rule requires an independent expert’s report, except in the cases expressly provided for in the law, such as:

• listed securities valued at market price (weighted average price)
• contributions of shares or participations in a company with turnover below €600,000 in the previous financial year
• technological movable assets with a total value below €3,000

The report must be issued within the preceding twelve months and must certify that the value attributed to the asset is real, reasonable and duly justified.

At ELYSIUM, we frequently carry out asset valuations. If you require a valuation of a company or any other asset for the purpose of a contribution or transfer, we will be pleased to assist you. Ensuring compliance with commercial, tax and legal requirements is as relevant as assigning a fair and defensible value — both for the protection of shareholders and for third parties (banks, suppliers, clients).

➤ If you wish to understand how a business or shareholding is valued, you may consult the article: How to value a business or shareholding: key criteria for determining a fair price

🔒 Liability of shareholders and directors regarding contributions

Until the company is dissolved, shareholders and directors are jointly and severally liable for:

• the actual existence of the contributions
• the value attributed to the non-cash assets
• the eviction and proper functioning of the non-monetary assets

This liability adds an important layer of legal certainty, particularly in companies whose initial capital includes significant assets.

📚 Best practices for incorporating a company safely

When incorporating a company, several relevant aspects may go unnoticed. Some of the main considerations include the following.

➤ For a full overview of the more technical factors to consider beforehand, you may consult: Key aspects to consider before incorporating a company

🟩 Aligning capital with the real dimension of the project

Although the law establishes minimum capital requirements, it is advisable to assess whether the project needs more capital, especially in cases involving:

• banking credibility
• financing needs
• recruitment of personnel
• operational structure
• short-term investments

There are alternative mechanisms to raise funds, but they should be evaluated from the outset.

🟦 Avoid unnecessary non-cash contributions

As discussed, these should only be used when they add genuine value and are thoroughly documented.

Share capital is not the only source of financing, and it comes with advantages as well as certain obligations.

🟧 Include clear clauses in the articles of association

This is particularly relevant for SLs, where it is advisable to define:

• economic rights
• transfer rules
• mechanisms for introducing new shareholders

➤ You may consult the article Articles of association of an Andorran company.

🟪 Accurately reflecting the beneficial ownership

Shares and participations must always be allocated to the actual beneficial owner — never to an intermediary.

This is particularly relevant in light of anti-money laundering requirements. Otherwise, the company may be unable to operate in any regulated market.

🟨 Ensuring coherence between capital and activity

A company engaging in complex or high-risk activities must have a level of capital that adequately supports such operations.

➤ To understand the full process of forming a company, you may consult:
Incorporating a company in Andorra: steps, requirements and advantages

🧠 Frequently asked questions

Although there may be many questions, some of the most common ones include the following:

❓ Must the share capital be fully paid up from the start?

Yes. For both SLs and SAs, capital must be fully paid up at the time of incorporation. This is a particular feature of Andorran law.

❓ Can the share capital be modified in the future?

Yes. The company may increase or reduce its capital by following the procedures established by law and adopting a formal resolution of the general meeting.

However, capital may never fall below the legal minimum — particularly not on a continuous basis. Otherwise, the company may fall into compulsory dissolution.

❓ Is it better to contribute capital or to finance the company through shareholder loans?

It depends on the project. As a general rule, a balance between both mechanisms tends to provide greater financial stability and cleaner accounting.

There are also mechanisms that allow shareholders to finance the company without going through a notary.

Conclusion

Share capital is far more than a formal requirement: it is a planning tool, a safeguard for third parties and a key element in structuring any corporate project correctly.

Understanding minimum legal thresholds, contribution requirements and best practices allows companies to be formed with greater transparency, solidity and long-term preparedness.

At ELYSIUM, we believe decisions should always be taken with clarity and knowledge. Trust in your consultant is not built on the number of services provided, but on the quality of the solutions you receive.

📞 Any questions?

If you need guidance to structure the capital of your future company or to carry out corporate restructuring operations, you may contact us here.

If you prefer a personalised meeting, you may book it down here. Whichever option you choose, we will be pleased to assist you.

Last updated: November 2025