Change of the Amount of Authorized Capital

Authorized capital is one of the key elements of a company’s corporate structure. It reflects the nominal value of the participants’ shares, determines the proportion of their corporate rights, and is recorded in the Unified State Register of Legal Entities, Individual Entrepreneurs and Public Organizations.

During business operations, a company may need to increase or decrease its authorized capital. This may be required due to attracting an investor, complying with licensing requirements, reinvesting profits, changing the ownership structure, withdrawal of a participant, or bringing corporate documents in line with the actual arrangements between the participants.

VINCO’S Legal Company supports changes to the authorized capital of LLCs and other legal entities: from consultation and document preparation to notarization, state registration of changes, and delivery of the final document package to the client.

The authorized capital of a company consists of the nominal value of the participants’ shares expressed in the national currency of Ukraine. A participant’s share may also be expressed as a percentage and must correspond to the ratio between the nominal value of the share and the total amount of authorized capital.

A contribution may be made in cash, securities, or other property unless otherwise provided by law. If a contribution is made in non-cash form, it must have a monetary valuation approved in the required manner.

Authorized capital is not a universal guarantee of the company’s obligations to counterparties. However, its amount is important for participants’ corporate rights, investment structure, licensing requirements, financial reputation, and public perception of the business.

• the company attracts a new investor or participant;
• participants decide to increase capital through additional contributions;
• the company reinvests retained earnings into business development;
• the company must comply with licensing or special regulatory requirements;
• not all participants have fully paid their contributions after incorporation;
• the capital needs to be reduced due to a change in the business model or ownership structure;
• the Unified State Register and charter must be aligned with the actual arrangements between the participants.

An increase of an LLC’s authorized capital is allowed only after all participants have fully paid their contributions. If the company owns a share in its own authorized capital, an increase is not allowed.

The main methods of increasing authorized capital include:

• additional contributions by participants;
• additional contributions by third parties, if allowed by the general meeting’s decision;
• increase from retained earnings without additional contributions;
• cash or non-cash contributions;
• set-off of mutual homogeneous claims between the company and a participant or third party.

When capital is increased through additional contributions, it is important to correctly determine the total amount of the increase, the planned authorized capital, the procedure for exercising participants’ pre-emptive rights, contribution deadlines, and the future size of participants’ shares.

A decrease of authorized capital is a more sensitive procedure because it may affect the interests of the company’s creditors. After the decision to decrease authorized capital is adopted, the executive body must notify in writing each creditor whose claims are not secured by pledge, guarantee, or suretyship.

Creditors may request that the company secure obligations, perform or terminate obligations early, or enter into another agreement. Therefore, before decreasing authorized capital, it is important to assess not only the corporate documents but also the company’s contractual and debt obligations.

If authorized capital is increased through property, such property must be valued in Ukrainian hryvnias. The law requires a monetary valuation of a non-cash contribution. In practice, this may involve an independent expert valuation or a valuation approved by the participants in accordance with the law and the charter.

To reduce corporate risks, it is advisable to prepare a valuation act, an act of acceptance and transfer of property into authorized capital, and to properly reflect the changes in the minutes of the general meeting and the charter.

Since the amount of authorized capital and participants’ shares are reflected in the Unified State Register, any change of authorized capital must be registered. The required documents may include a decision or minutes of the general meeting, a new version of the charter or amendments to it, a registration application, and other documents depending on the situation.

As of 2026, the administrative fee for state registration of changes to information about a legal entity under the standard procedure is approximately UAH 1,000. The final amount may depend on the filing format, urgency, and specific registration action.

• current version of the company charter;
• information about the company participants;
• current and planned amount of authorized capital;
• information about the size of participants’ shares before and after the change;
• information about the source of the increase: cash, property, retained earnings, or another mechanism;
• documents related to property, if the contribution is made in non-cash form;
• financial information on retained earnings, if capital is increased without additional contributions;
• information about creditors, if a decrease of authorized capital is planned;
• power of attorney or another document confirming the representative’s authority.

1. Consultation on increasing or decreasing authorized capital.
2. Analysis of the charter, participant structure, and corporate risks.
3. Selection of the optimal mechanism for changing capital.
4. Preparation of a decision or minutes of the general meeting.
5. Preparation of a new version of the charter or amendments if necessary.
6. Organization of notarized signing of documents.
7. Filing documents for state registration of changes.
8. Obtaining the registration result and delivering documents to the client.