The nature of authorized capital and some rules of capital maintenance

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    Abstract

    Nowadays the issues of sufficiency and maintenance of company capital are becoming more relevant in the company law. Company capital maintenance theory incorporates requirements for the company’s initial capital, the amount of equity capital, capital sufficiency, rules for the restoration of reduced equity capital, and rules for the distribution of company funds to the shareholders. At the European Community level, the rules for maintaining the capital of public limited liability companies are regulated by the Second Council Directive of 13 December 1976. In Lithuania, the majority of the Second Directive provisions have been integrated into the Law on Companies. However, not a single Lithuanian law scholar has ever analysed the main rules of the capital maintenance concept or its implementation in Lithuanian law. The article provides a structural analysis of the capital sufficiency concept and examines the implementation of this concept in Lithuania.
    Original languageEnglish
    Pages (from-to)241-255
    JournalSocialinių mokslų studijos: mokslo darbai
    Issue number3 (3)
    Publication statusPublished - 2009

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    Keywords

    • Authorized capital of a public limited liability company
    • Capital maintenance
    • Protection of the rights of the company’s members

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