Legal Q&A · Company & shareholders

Can an s.r.o. shareholder replace a cash contribution with a non-cash contribution?

Law as at 17 August 2026

Answered by , Czech and Slovak attorney, admitted to the Slovak and Czech Bars (SAK 300422 · ČAK 19654).

Short answer

The Commercial Code has no direct mechanism for swapping a cash contribution for a non-cash one, but the result can be achieved in two steps. First, increase share capital with an asset valued by an expert. Then, once capital exceeds the statutory minimum, reduce it and return the original cash contribution. Minimum capital and contribution levels and all increase and reduction rules must be observed.

Does the law allow a direct swap?

The Commercial Code has no special mechanism by which a shareholder simply replaces cash already contributed with a non-cash contribution. That does not make the aim impossible: the company can hold property or another asset instead of cash. The result can be reached through two recognised mechanisms, a share capital increase and reduction.

A two-step process

First, increase share capital through a non-cash contribution. Only assets with a determinable economic value qualify. An expert report determines that value, and the founding document must identify the asset and the amount credited towards the contribution (Section 59). Total share capital will then exceed the statutory minimum.

Second, reduce share capital and return the original cash contribution to the shareholder. The company is left holding the contributed asset instead of cash. The sequence must ensure that capital never falls below €5,000 or a shareholder’s contribution below €750 (Sections 108 and 109), and that statutory requirements for both steps are met, including creditor protection on reduction.

What should you watch for?

This changes registered share capital and involves several formal requirements, from expert valuation and general meeting decisions to reduction deadlines. From 17 August 2026, a capital change altering shareholders’ ownership proportions requires the meeting proceedings to be certified by a notarial deed (Section 127a(4) of the Commercial Code, as amended by Act No. 29/2026 Coll.). For a sole shareholder, a decision authorised by a lawyer also suffices (Section 132(1)). Sometimes the same result can be achieved more simply, so discuss the plan first. We prepare the process through share capital changes, reflect amendments in the memorandum of association and handle Commercial Register changes.

This answer provides general information on the law as at 17 August 2026. It does not constitute legal services or replace an assessment of an individual case. The details of your situation may differ. Book a consultation to discuss them.

More legal questions

All questions and answers
  1. Can I appoint the company’s managing director to represent me at a general meeting? You may be represented under a written power of attorney. However, the law prohibits the company’s managing director or a supervisory board member from acting as proxy. Choose someone else, such as a lawyer, family member or another trusted person, and give them written authority.
  2. How do I remove a managing director of an s.r.o.? Appointment and removal of a managing director fall within the general meeting’s powers; in a single-member s.r.o., the sole shareholder decides. A properly convened meeting and a decision passed by the required majority under the memorandum of association are needed. From 17 August 2026, proceedings with this agenda item must be certified by a notarial deed. The change is then entered in the Commercial Register. Removal from office does not settle claims under the director’s service agreement.
  3. Can I contribute my work to the company instead of money? No. Share capital contributions may consist of money or assets with a determinable economic value. The law expressly prohibits contributions consisting of a promise to perform work or provide services (Section 59(2) of the Commercial Code). Future work must be rewarded another way: allocation of ownership rights, vesting in a shareholders’ agreement, options or shares with special rights.
  4. What is a simple joint-stock company, and who is it suitable for? A simple joint-stock company (j. s. a.) is a capital company aimed mainly at startups. Share capital starts at €1, even a single individual can establish it, and it issues shares, including shares with special profit, voting or information rights. It requires a notarial deed, full payment of capital before incorporation and an issue of book-entry shares through the Central Securities Depository.

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Mgr. Patrik Tulinský, LL.M. Czech and Slovak attorney · SAK 300422 · ČAK 19654

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