The commercial section of the French Supreme Court (Cour de Cassation) declared on May 17 1994 that successive operations affecting on a company's corporate capital (reduction to zero followed by a capital increase) are valid as long as they are motivated by the financial position of the company and that the equity holders are not required to bear any new obligations.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. For additional information contact Claire Acard on +33 (1) 55 61 10 10. The members of ARCHIBALD ANDERSEN Association d'Avocats (S.G. Archibald and Arthur Andersen International) are registered with the Hauts-de-Seine Bar.
Copyright Mondaq Ltd 1995 Tel +44 171 820 7733.