⚠️ A Stock Market False Friend… to Be Replaced in the Corporate Structure
The term share capital is often misinterpreted by francophones: one might think it refers to a specific share or a stock investment.
👉 In reality, under corporate law, share capital designates the capital social issued by a company limited by shares — i.e., the total contributions made by shareholders in exchange for equity.
It is not a market asset, but a notion tied to a company’s financial structure and internal governance.
⚖️ In Law: Foundation of the Company’s Identity and Legal Capacity
Share capital is composed of:
-
Subscribed capital (capital souscrit): total amount of issued shares
-
Paid-up capital (capital libéré): portion actually paid by shareholders
-
Authorized capital (capital autorisé, in some systems): maximum amount issuable without statutory amendment
It may be increased or reduced through specific procedures (issuance, consolidation, buy-back, etc.).
Examples
-
The company increased its share capital to fund expansion
→ La société a augmenté son capital social pour financer sa croissance
-
The nominal value of the share capital is £100,000
→ La valeur nominale du capital social est de 100 000 livres
-
Share capital must be distinguished from share premium
→ Le capital social doit être distingué de la prime d’émission
👉 In France, share capital corresponds to the notion of capital social recorded in the company’s statutes (statuts).
🧾 Typical Contexts of Use
-
Company formation: initial contributions, allocation of voting rights
-
Fundraising: issuance of new shares
-
Corporate governance: impact on distribution of power and dividends
✅ In Summary
-
Share capital = capital social of a company limited by shares
-
Not to be confused with: single share, stock portfolio, market capitalization
-
Serves as the basis for limited liability and shareholder structure
📌 TransLex Guidance
Before translating share capital, ask yourself:
-
Does it refer to the entirety of issued shares of the company?
-
Is the text about internal structure, statutes, or company accounts?
-
Is it a matter of increase, reduction, or valuation of capital?
👉 In law, share capital = capital social statutaire, not a single share or isolated investment.
👉 A rigorous translation is crucial in any corporate document.
