noun
legal reserves
A technical term in corporate law and accounting referring to reserves that a company is legally required to set aside from its profits.
株式会社は、資本準備金と利益準備金を法定準備金として積み立てなければならない。
A stock company must set aside capital reserves and retained earnings reserves as legal reserves.
Compound of 法定 (legal, statutory) + 準備金 (reserves, reserve fund). The term is a direct translation of the Western accounting concept of legal reserves, adopted into Japanese corporate law.