Legal Definitions - nominal capital

Definition: Nominal capital is the minimum value of shares that a company is allowed to issue according to its association documents.

Example: If a company's association documents state that it can issue shares worth $10 each, then the nominal capital of the company would be the total value of all the shares it is authorized to issue, which would be $10 multiplied by the number of shares.

Explanation: Nominal capital is the minimum amount of capital that a company is required to have according to its association documents. It is also known as authorized capital. This capital is not necessarily the same as the actual capital that the company has raised through the sale of its shares. The nominal capital is important because it sets a limit on the amount of capital that the company can raise through the sale of its shares.