Shareholder payments for future capital increases: when are they refundable?

The Supreme Court, with order no. 24093/2023, returns to the issue of payments on account of future capital increases, offering new food for thought with reference to a topic that is often the subject of contention in intra-corporate dynamics.

First of all, it should be noted that the donations of money made by the shareholders in favour of the company can, in general, be divided into: a) contributions; (b) shareholder loans; (c) non-refundable or capital payments; (d) payments for a future capital increase. These last two types of payments, because of their specific characteristics, have often been the subject of analysis, since, although they often do not present obvious differences in practice, they produce significantly different effects.

The Supreme Court has already, in some precedents (see order no. 29325/2020), provided precise definitions of the figures under consideration:

• "Capital payments" are repayable donations of money from shareholders aimed at providing risk capital to the company. These payments must be recorded in the liabilities of the balance sheet as reserves, freely available for the shareholders' meeting (in order to cover losses, i.e. increase the capital free of charge). Their characteristic is that these items, once paid, lose any subjective imputation and, being definitively acquired by the company, are to be divided (in the case of use/distribution) among all the shareholders, in proportion to the participation in the share capital;

• "Payments on account of a future capital increase" are donations of money aimed at releasing the debt deriving from the subscription of a future capital increase. Unlike capital payments, therefore, although recorded in the balance sheet as reserves, they are not available, as they are not definitively acquired in the company's assets. In addition, it is a "personalized" or "labeled" reserve, as it is the exclusive responsibility of the member who made the payment. In this case, the title and the concrete cause of the payment are represented by the future capital increase, with the consequence that, if the latter is not resolved, the shareholder will be entitled to the return of the amount paid.

However, this clear distinction is generally much less evident when tested by Italian corporate practice.

In particular, it is now a common principle that, in order to qualify a payment as a "future capital increase", the name used in the corporate and accounting documents alone is not sufficient.

In fact, the subordination of the payment to a capital increase must be clear and unequivocal, which can (and must) be inferred from sufficiently specific and detailed elements, capable of making clear the intention of the shareholder (and of the parties) that this transaction is preordained to a future contribution aimed at increasing the shareholding, providing that, otherwise, the company will have to return the sums received (which, therefore, cannot be considered definitively acquired in the company's assets).

It is, therefore, crucial for the shareholder who intends to obtain reimbursement of the sums paid (if the capital increase is not formalized) to give specific and timely evidence, alternatively (or jointly):

• in the Shareholders' Meeting where such a decision is communicated and/or announced;
• at the time of payment, by means of specific ad hoc contractual documentation, expressly indicating the final deadline within which the capital increase will be approved;
• in the company's accounting, where a specific and clear representation of this relationship is given, for example, in the notes to the financial statements.

In conclusion, it seems appropriate that the shareholder, if he intends to make a payment on account of a future capital increase, pay due attention to the related formal requirements, in order to avoid the risk (in the event of failure to increase and/or exit from the company) of not being reimbursed the sums paid, to the benefit of the entire corporate structure (and to its detriment).

Dott.ssa Noemi Ragusa 

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