Accounting and share capital in euros

Content

It is possible for limited companies, economic associations and Swedish branches of foreign enterprises to keep their accounts in euros instead of kronor. The enterprise itself decides if the accounting should be kept in euros. The change must be registered with Bolagsverket. 1 euro = 100 cents.

Changeover to euros for limited companies

The share capital of a limited company must be expressed in the company's accounting currency. If the company changes to accounting in euros, its share capital must also be converted and expressed in euros. The conversion takes place at the rate of exchange determined by the European Central Bank (ECB).

The changeover to euros for a limited company takes place in the following steps

1. The general meeting passes a resolution to change over to euro accounting and to adopt new articles of association. The new articles must contain a provision which clearly states that euro is to be the company's accounting currency, e.g. “The company's accounts shall be kept in euros.”
2. The amendment of the articles of association must be notified to Bolagsverket for registration. The decision to change the articles of association takes effect at the beginning of the next financial year to start after the registration. The company therefore needs to pass the resolution and notify the change well in advance of the start of the new financial year. If Bolagsverket fails to register the amendment of the articles of association by that time, the amendment will not take effect until the following financial year.
3. Bolagsverket converts the share capital to euros. The conversion takes place at the ECB exchange rate on the last Swedish banking day of the most recent financial year.
4. Bolagsverket issues a special register extract and sends it to the company. The register extract shows the conversion rate and the share capital in euros.
5. After the change has been registered, the board of directors must move the necessary consequential amendments of the articles of association. This must be done no later than at the first ordinary general meeting after the changeover to accounting in euros has taken effect. The main consequential amendments relate to the limits on share capital, which are still expressed in kronor in the articles.
6. The general meeting of shareholders passes the consequential amendments of the articles of association and is responsible for the notification to Bolagsverket.
7. Bolagsverket registers the amendment of the articles of association.

Changeover to accounting in euros: economic associations

The provisions applicable for economic associations (ekonomisk förening) are similar to those for a limited company. The changeover takes place in the following steps:

1. The general meeting of the association passes a resolution to change over to accounting in euros. The new statutes must contain a clear provision to this effect, e.g. “The accounts of the association shall be kept in euros”.
2. The amendment of the statutes must be notified to Bolagsverket. It takes effect at the beginning of the next financial year after the resolution is passed. Note that the amendment must be registered with Bolagsverket prior to that time. The association therefore needs to pass the resolution and notify the amendment well in advance of the start of the new financial year. If Bolagsverket fails to register the amendment of the statutes before that date, the amendment is void.
3. Bolagsverket issues a special certificate to the association stating the conversion rate to be used.
4. The board must move the necessary consequential amendments of the statutes no later than the first ordinary general meeting after the changeover to accounting in euros. The consequential amendments mainly affect the provisions relating to the size of member contributions, which are still stated in kronor in the statutes and must therefore be converted and expressed in euros. Investor shares (förlagsinsats), if issued, are not converted. Provisions relating to investor shares in the statutes shall be expressed in the original currency.
5. The general meeting passes the consequential amendments, which the board notifies to Bolagsverket.
6. Bolagsverket verifies that the association has used the correct conversion rate when stating the new member contributions and registers the amendment of the statutes.

Notification to Bolagsverket

Please use form 817 to notify amendments of articles of association of a limited company; use form 914 when notifying amendments of the statutes of an economic association.

Attachments to a notification

A notification of new articles of association of a limited company must be accompanied by a certified copy of the minutes of the general meeting and one copy of the new articles of association in their entirety.

A notification of new statutes of an economic association must be accompanied by a certified copy of the minutes of the general meeting and two copies of the new statutes.

Date of changeover to accounting in euros

A change in the accounting currency may only take place at the beginning of a new financial year.

Annual report

Upon a change in the accounting currency the balance sheet for the most recent financial year must be converted to euros. Conversion takes place at the exchange rate determined by the ECB on the last Swedish banking day of the financial year. The converted balance sheet becomes the opening balance for the new financial year. Consolidated accounts shall be reported in the same currency as the parent company's annual accounts.

Mergers

Mergers are only permitted between companies or economic associations having the same accounting currency.

Registration of new enterprise

If a limited company or economic association intends to use accounting in euros from the formation of the enterprise, this shall be stated in the draft articles of association or the draft statutes. All provisions relating to share capital must be expressed in euros.

Changing back to accounting in kronor

If an enterprise has changed its accounting currency once, the permission of the tax authority is required for a further change. A return to kronor (the previous currency) is implemented by again amending the articles of association or the statutes. The amendment takes effect as from the beginning of the next financial year after the amendment is passed.

Upon conversion from euros back to kronor, the share capital may fall short of the required amount of SEK 50 000, SEK 500 000, respectively. If so, the company must notify an increase in its share capital within six months. If Bolagsverket does not receive such notification within this time limit, liquidation proceedings will be commenced.

Fees

The fees for registration, see Prices and fees.

References

The most important relevant laws and regulations are:

• The Companies Act (Aktiebolagslagen, 2005:551), Article 1, sections 4, 5 and 14,
• The Companies Act, Article 3, sections 2 and 8-10,
• The Companies Act, Article 23, section 3
• The Companies Act, Article 25, section 11
• The Companies Ordinance (Aktiebolagsförordningen, 2005:559), Article 1, section 6
• The Co-operative Societies Act (Lagen om ekonomiska föreningar, 1987:667) Article 2, section 2
• The Co-operative Societies Act, Article 7, section 14
• The Co-operative Societies Ordinance (Förordningen om ekonomiska föreningar, 1987:978), section 7
• The Foreign Branch Offices Act (Lagen om utländska filialer m.m., 1992:160), section 14
• The Book-keeping Act (Bokföringslagen 1990:1078), Article 4, section 6
• The Annual Accounts Act (Årsredovisningslagen 1995:1554), Article 2, section 6
• The Annual Accounts Act, Article 7, section 7

Nr 829 xe, 20 July, 2010