Repeal of rules regarding shareholder loans and other amendments to the Danish Companies Act
Published 20 December 2024
Category: Corporate Regulation
Repeal of rules regarding shareholder loans and other amendments to the Danish Companies Act
On 19 December 2024, the Danish Parliament has adopted the amendment acts L71 and L72 regarding amendments to the Danish Companies Act (in Danish: selskabsloven) and other Danish laws. Among other amendments, L71 and L72 implement the following key initiatives:
Equity crowdfunding for Danish private limited liability companies
New rules are introduced according to which Danish private limited liability companies (in Danish: anpartsselskaber) will be entitled to offer shares to the public, either (i) by way of so-called “equity crowdfunding” through an approved equity crowdfunding platform pursuant to the rules of the Crowdfunding Regulation (requiring that the value of the offer does not exceed EUR 5 mio. calculated over 12 months), or (ii) as a public offer of shares conducted by the company itself without any limitations with respect to the value of the offer, provided that the offer meets at least one of four criteria set out in L72 (for instance, that the offer is addressed solely to ‘qualified investors’).
Capital requirement for Danish private limited liability companies
The minimum capital requirement for Danish private limited liability companies is reduced from DKK 40,000 to DKK 20,000.
Shareholder loans
The rules regarding shareholder loans as set out in Sections 210-212 of the Danish Companies Act are repealed. This will allow companies to provide loans (or other financial assistance) to its shareholders and members of its management, as well as to shareholders and management members of the company’s parent company, among others, without having to adhere to the requirements set out in Section 210(2) of the Danish Companies Act, including the requirement that a decision to provide such financial assistance must be resolved by the general meeting (or the board of directors based on an authorization).
However, such shareholder loan etc. will still be subject to the self-financing rules (in Danish: selvfinansieringsreglerne) and the general capital protection provisions in Danish Companies Act, including that the management is obligated to ensure that such shareholder loan etc. is prudent taking into consideration the company’s financial position. Additionally, the existing rules regarding the tax treatment of shareholder loans are unchanged.
The amendment acts L71 and L72 take effect as from 1 January 2025, however the effective date of the new capital requirement of DKK 20,000 for Danish private limited liability companies is not yet determined but is expected to be as soon as possible in 2025.
The amendment act L71 can be found here.
The amendment act L72 can be found here.
Tags: Venture Capital
Also tagged ‘Venture Capital’
Abolition of the ‘entrepreneur tax’ and other changes to Danish tax legislation adopted
On 19 December 2024, amendments to the Danish Corporation Tax Act, the Danish Capital Gains Tax Act and the Danish Personal Tax Act, as well as other Danish tax laws, were adopted by the Danish Parliament.
Venture CapitalProposal for new strategy on entrepreneurship in Denmark
As set out in Pulse update on 13 June 2024, the Danish government has presented a proposal regarding entrepreneurship in Denmark, which includes initiatives aimed at creating better access to capital for startups, cutting the burden of red tape on business and certain relaxation of taxes.
Venture CapitalProposal for new strategy on entrepreneurship in Denmark
On 12 June 2024, the Danish government presented a proposal regarding entrepreneurship in Denmark, which includes initiatives aimed at creating better access to capital for startups and certain relaxation of taxes.
Venture CapitalMarket update – New Nordics Q1 2024
byFounders has published their Q1 market update for 2024. Key takeaways include: Several fundraising rounds were announced in Q1 2024, including 18 pre-seed, 35 seed, and 10 Series A rounds. This is an increase from a total of 40 to 63 rounds compared to Q1 2023. The capital invested in the New Nordics increased from […]
Venture CapitalThe time between investment rounds has increased
According to new data from Carta, time between primary US venture rounds is getting longer.
Venture CapitalCalifornia passes law mandating VC firms to release investments’ diversity information
In the first ever US law aiming at increasing diversity within the venture capital landscape, the Californian governor has signed SB 54 into law.
Venture CapitalSenior liquidation preferences create tensions between VCs
A new PitchBook analysis show that senior liquidation preferences create tension between collaborating VCs.
Venture CapitalState of the private markets: Q3 2023
Carta has published a preview of their Q3 2023 private market report.
Venture CapitalDeep dive into Q3 2023’s funding landscape
Jamesin Seidel, Investment Partner at the VC fund Chapter One, has analyzed Q3 data on the funding landscape from Crunchbase, based on US-based investments.
Venture CapitalVCs believe the worst times are over
VCs believe the worst times are over In Q4 2022, US-based venture capital funds experienced a sharp decline with an IRR of -16.8%, marking the asset class’s worst quarterly return in a decade. The downturn was attributed to the need for venture capital funds to devalue their late-stage portfolio companies, aligning them with comparable […]
Venture CapitalFemale GPs are an undervalued asset
A new 2023 report from European Women in VC highlight new findings of diverse investment teams in the growth and venture space.
Venture CapitalLPs push GPs to tie fund fees to impact goals
As the markets have turned for more negotiation power with LPs, expectations are going green, according to PitchBook: LPs are demanding terms aligning managers of impacts funds more closely with their sustainability outcomes.
Venture CapitalVCs shift focus to AI
Pitchbook’s Emerging Tech Indicator (ETI) tracks global investment activity across types of technologies, with special focus on successful VCs.
Venture CapitalNew venture report
Aumni, a J.P. Morgan company, have published a new first half 2023 venture report, showing the status of the private capital markets.
Venture CapitalNew Nordic Impact Startups 2023 report
Danske Growth, a part of Danske Bank, has published their new Nordic Impact Startups 2023 report.
Venture CapitalNew advance tax ruling regarding simple agreement for future equity (SAFE)
On 3 October 2023, an advance tax ruling was published according to which the National Tax Board has decided that an investment product structured as a Simple Agreement for Future Equity (SAFE) was not a “subscription right” covered by the Danish Share Capital Gains Act but was deemed a “financial contract” governed by article 29 of the Gains on Securities and Foreign Currency Act
Venture CapitalVC funding for female founders keep steady
Despite the recent surge in venture capital funding, female founders are still facing challenges.
Venture CapitalInvest Europe Private Equity 2022 Benchmark Report
The 2022 Private Equity Benchmark Report for 2022 has been published.
Venture CapitalOther updates
Abolition of the ‘entrepreneur tax’ and other changes to Danish tax legislation adopted
On 19 December 2024, amendments to the Danish Corporation Tax Act, the Danish Capital Gains Tax Act and the Danish Personal Tax Act, as well as other Danish tax laws, were adopted by the Danish Parliament.
Venture CapitalThe Danish Financial Supervisory Authority publishes guiding statement on alternative investment fund managers’ inclusion of leverage in unlisted companies and issuers
On 17 December 2024, the Danish Financial Supervisory Authority (Danish FSA) published a guiding statement regarding the inclusion of leverage by alternative investment fund managers (AIFMs) in unlisted companies and issuers.
AIFMDDanish RegulationESMAThe Danish FSAThe Danish FSA’s role in the sustainability reporting in 2025
The Danish Financial Supervisory Authority (“FSA”) has published a short press release regarding their role in relation to the sustainability reporting in 2025.
CSRDProposal on independent providers of audit services regarding sustainability reporting
The Danish Parliament has presented a proposal for legislation on independent providers of audit services regarding sustainability reporting.
CSRDInvest Europe launches enhanced ESG reporting template
Invest Europe has launched an enhanced ESG reporting template to drive convergence and support early-stage investors developed with Venture ESG.
CSRDSFDRThe Danish FSA has updated the fit & proper guidelines
On 29 November 2024, the Danish FSA published a new and updated version of its guidelines on requirements in the financial legislation regarding the suitability and integrity of board members, executive management members and key persons in financial companies, known as the fit & proper guidelines.
Danish RegulationGovernanceThe Danish FSA