Initial capital contribution: complete guide to types, procedure, and required documents

An initial capital contribution is the foundational equity (registered capital) that founders invest into a limited liability company (LLC / DOO / DOOEL) to establish its core assets (minimum statutory requirement of €5,000 in MKD equivalent). Any type of contribution (cash or in-kind assets) can legally be deposited immediately upon formation or within a one-year deadline from the date of company registration.

When establishing a limited liability company, defining and registering the statutory core capital is a legal prerequisite.

The capital contribution serves three core functions:

• Legal function: A mandatory requirement for valid incorporation and entry into the central register.
• Financial function: Initial liquid or operational assets required to commence day-to-day business activities.
• Guarantee function: A minimum baseline of security for creditors and business partners.

Under the law on trade companies:

• The minimum core capital requirement for an LLC (DOO/DOOEL) is €5,000 (in MKD equivalent).
• Flexible deposit window: Founders have the legal option to deposit any type of contribution either immediately during the initial registration process or within one year from the date of incorporation.

Founders can settle their equity commitment through two primary forms:

1. Cash contribution

The most direct method, executed by depositing funds directly into the company’s designated corporate bank account.

• Can be deposited as a lump sum upon incorporation or executed incrementally within the one-year legal timeframe.
• Directly supplies working capital for initial operational expenses.

2. In-kind contribution (property, equipment, and rights)

Allows founders to capitalize the company using tangible or intangible assets that possess determinable economic value:

• Movable property: Vehicles, industrial machinery, IT equipment, office inventory.
• Real estate: Commercial premises, industrial warehouses, land parcels.
• Intangible rights: Intellectual property, registered trademarks, proprietary software solutions, licenses.

Mandatory rule for in-kind contributions: To contribute non-cash assets (whether at the time of incorporation or within the one-year window), the founder must engage a licensed independent appraiser to draft an official valuation report establishing the market value of the property or rights.

Comparison: cash vs. in-kind contribution

Executing a capital contribution alters the formal status of the company’s capital from “subscribed/unpaid” to “paid-in.” To process this change with the central register, the following legal documents must be prepared:

1. 1. Corporate resolutions and statutory statements:
   • Resolution on capital contribution: An operational corporate decision by the founder(s) formalizing the execution of the deposit.
   • Resolution on amending the act of foundation (pursuant to article 252): A formal legal resolution reflecting the updated capital status within the foundation act or articles of association (as governed by articles 252 and 253 of the law on trade companies).
   • Consolidated / clean text of the act of foundation: The complete, amended version of the foundation act (DOOEL) or company agreement (DOO) reflecting the fully paid-in capital.
   • Statutory statement under articles 29 and 32: Certified declarations by the manager/shareholders verifying compliance with legal requirements, absence of statutory impediments, and settled tax liabilities.

2. Evidentiary proof of contribution:

• For cash contributions: Official bank confirmation or account statement proving that funds were credited to the corporate account.
• For in-kind contributions:
  • Official valuation report prepared and stamped by a licensed appraiser.
  • Verifiable proof of ownership (title deed, vehicle registration, purchase invoices).
  • Written agreement or formal declaration transferring full title and possession to the company.

1. Procure the proof of contribution: Deposit the cash into the business bank account, or have a certified appraiser issue the official valuation report for physical/intangible assets.
2. Adopt the resolution on contribution: The shareholder(s) pass the formal resolution executing the contribution.
3. Amend the foundation documents: Adopt the resolution on amending the foundation act (pursuant to article 252) and prepare the new consolidated text.
4. Execute statutory declarations: Sign the required declarations pursuant to articles 29 and 32.
5. Electronic filing with the registry: An authorized registration agent or legal counsel submits the entire legal dossier to the central register to update the corporate record.

• Missing the 1-year statutory deadline: If capital is not deposited upon formation, exceeding the 365-day statutory deadline without registering the contribution constitutes a regulatory violation with legal liabilities for the company and its manager.
• Conflating the required resolutions: Submitting only an operational decision to contribute without the formal resolution to amend the act (article 252) and the consolidated text is one of the most frequent reasons for administrative rejection by the registrar.
• Uncertified asset valuations: Using internal purchase receipts or arbitrary book values instead of an official valuation report prepared by a licensed independent appraiser.