Argentina Market
Setting up a Company in Argentina
The following factors will be previously considered in order to set up a company in Argentina.
Companies´ Legal Structure
Argentine Companies Law or LSC (Law No. 19550) rules companies’ legal structure throughout the Argentine territory and provides the different types of companies that may be incorporated in Argentina. The types of companies most commonly used by foreign investors in Argentina are the Sociedad Anónima (SA, Argentine Corporation) and the Sociedad de Responsabilidad Limitada (SRL, Argentine Limited Liability Company). However, the Companies Law also includes another legal concept named Foreign Company’s Branch.
- Argentine Corporation: In the case of SAs, there are no limits on the number of shareholders (SRLs may be shareholders of a SA). Shareholders’ liability is limited to their paid-in capital and the administration is carried out by a board of directors consisting of one or more directors who may be shareholders or not.
Directors are unlimitedly, jointly and severally liable to the company, shareholders and third parties for failure to duly comply with their duties as well as the violation of the law, the bylaws or regulations and for any other kind of damage caused by willful misconduct, power abuse or gross negligence.
SAs must be incorporated by public deed. They must be registered with the Inspección General de Justicia (IGJ, Companies Control Authority) or Provincial Registry. A minimum original capital of AR$12,000 (Twelve thousand Argentine Pesos) is required.
- Argentine Limited Liability Company: In the case of SRLs, the minimum number of members is 2 (two) and the maximum number is 50 (fifty). SAs cannot be members of SRLs. Members’ liability is limited to the payment of the ownership interests subscribed or acquired thereby. Members are unlimitedly as well as jointly and severally liable to third parties for the payment of their interests.
The administration and representation of the company is carried out by one or more managers, whether members or not. Managers will be either separately or jointly and severally liable according to the management organization and its operation rules as set forth in the operating agreement.
SRLs may be incorporated by a public or private instrument. They must be registered with the IGJ (or provincial registry). No minimum capital is required. However, the capital shall be proportional to the company’s purpose.
- Foreign Company’s Branch Office: In order to legally operate as a branch, it is necessary to prove the existence of the company’s headquarters abroad, register the bylaws, articles of incorporation or operating agreement thereof with the IGJ, appoint representatives and register them as well.
Branches are subject to permanent control by the companies control authority and must comply, in any relevant aspects, with all the requirements imposed on Argentine corporations that are subject to such control.
Branches must keep separate accounts from their headquarters and submit their financial statements before the companies control authority.
Steps to Incorporate a Company in Argentina:
The incorporation process of a company in Argentina lasts around 30 days. The steps to start the business depend on whether you want to incorporate a company or a branch office and are as follows:
Foreign Companies that Incorporate a Company in Argentina
Preliminary aspects:
Any foreign company, in order to incorporate a company in the Argentine Republic, shall previously:
Preliminary aspects:
Any foreign company, in order to incorporate a company in the Argentine Republic, shall previously:
- Prove that it has been duly incorporated under the laws of their respective countries before the Argentine registry judge.
- Register the company’s original agreement, any amendments thereto and any other authorizing documents as well as any documentation related to its legal representatives with the Argentine Public Registry of Commerce (in the case of a company by shares, all documents shall be submitted also to the Company by Shares Registry).
- Inform if there exists any legal prohibition or restriction to carry out, in its place of origin, all of its activities, any main activity or activities. Such information is evidenced by the company’s operating agreement or articles of incorporation or any further amendments thereto, if any.
- Prove that, as of the registration application date, the company complies with at least one of the following conditions outside the Argentine Republic:
The existence of one or more permanent branches or representations, by attaching to that effect, their certificate of good standing issued by their principal place of business’ pertinent administrative or judicial authority.
Interest ownership in any other company in the form of non current assets, in accordance with the definitions set forth in the General Accepted Accounting Principles.
Ownership of fixed assets in their place of origin, the existence and value of which shall be proved in accordance with the definitions set forth in the General Accepted Accounting Principles.
The last two items shall be evidenced by the company’s financial statements and/or certification subscribed by an officer thereof, whose representation powers shall also be proved, and extracted from the accounting entries registered in the company’s respective books.
Whenever the Company is registered with the exclusive purpose of being an investment “vehicle” or instrument of a parent company, some additional formal requirements shall be fulfilled (See Section 190 – IGJ Res. 7/05).
1) Request an "Application for Reservation of Name” to the IGJ.
In order to request the Application for Reservation of Name, Form No. 3, which has to be acquired at the IGJ (Approx. cost: AR$18), must be submitted. It is submitted at the "Reservation of names" sector (original document and one copy) and contains three proposals.
In order to request the Application for Reservation of Name, Form No. 3, which has to be acquired at the IGJ (Approx. cost: AR$18), must be submitted. It is submitted at the "Reservation of names" sector (original document and one copy) and contains three proposals.
2) Submission Form
Form No. 1: Incorporation and modification (Approx. cost: AR$282).
Besides, the following items must be attached thereto:
The company’s agreement or articles of incorporation and certified copies thereof. Professional certificate of prequalification (issued by a certified public accountant or lawyer).
Form No. 1: Incorporation and modification (Approx. cost: AR$282).
Besides, the following items must be attached thereto:
The company’s agreement or articles of incorporation and certified copies thereof. Professional certificate of prequalification (issued by a certified public accountant or lawyer).
3) Payment of the Incorporation Fee or the Service Fee, as applicable
If a SA is to be incorporated: The incorporation fee is paid at the Banco de la Nación Argentina (Bank of the Argentine Nation). Companies by shares will pay a lump sum fee of AR$100.
If a SRL is to be incorporated: The incorporation fee is paid at the Banco de la Nación Argentina (Bank of the Argentine Nation). Argentine limited liability companies will pay a lump sum fee of AR$30.
If a SA is to be incorporated: The incorporation fee is paid at the Banco de la Nación Argentina (Bank of the Argentine Nation). Companies by shares will pay a lump sum fee of AR$100.
If a SRL is to be incorporated: The incorporation fee is paid at the Banco de la Nación Argentina (Bank of the Argentine Nation). Argentine limited liability companies will pay a lump sum fee of AR$30.
4) Public Notice
Section 10, Subsection A of LSC provides that Argentine limited liability companies and companies by shares must publish a one-day notice in the official legal bulletin.
Section 10, Subsection A of LSC provides that Argentine limited liability companies and companies by shares must publish a one-day notice in the official legal bulletin.
The data contained therein must be as follows:
- Members’ name, age, marital status, nationality, occupation, domicile, identity document number;
- Articles or incorporation date;
- Company’s name;
- Company’s domicile;
- Company’s purpose;
Term; - Equity Capital;
- Composition of the administration and supervision bodies, members’ names and, if applicable, term of their offices;
- Legal representation organization;
- End date of fiscal year.
5) Initial deposit
An initial deposit must be made at the Banco de la Nación Argentina (Bank of the Argentine Nation) equal to 25% of the paid-up capital in cash. Such deposit may be made when the registry incorporation is requested.
An initial deposit must be made at the Banco de la Nación Argentina (Bank of the Argentine Nation) equal to 25% of the paid-up capital in cash. Such deposit may be made when the registry incorporation is requested.
Foreign Companies’ Branches Offices
In order to legally operate as a branch, the following items are necessary:
I. Company’s certificate of good standing (in the country of origin) and a certificate stating that such company is under no liquidation or any other kind of legal proceedings that result in restrictions imposed on its assets and/or activities.
If the legislation of the country where the company is incorporated does not provide for the official issuance of such certificate, it will be replaced by a report issued by a lawyer or public notary from said country including all the items mentioned above.
II. Foreign documentation containing:
a) The company’s contract or articles of incorporation and any amendments thereto.
I. Company’s certificate of good standing (in the country of origin) and a certificate stating that such company is under no liquidation or any other kind of legal proceedings that result in restrictions imposed on its assets and/or activities.
If the legislation of the country where the company is incorporated does not provide for the official issuance of such certificate, it will be replaced by a report issued by a lawyer or public notary from said country including all the items mentioned above.
II. Foreign documentation containing:
a) The company’s contract or articles of incorporation and any amendments thereto.
b) The resolution of the company’s body that decided to form the permanent place of business, branch or representation in the Argentine Republic.
c) End date of its fiscal year.
d) Domicile of its principal place of business in the Autonomous City of Buenos Aires (a representative may be expressly authorized to establish it).
e) Allocated capital, if any.
f) Appointment of the company’s representative, who must be an individual.
III. The foreign documentation must be subscribed by a company’s officer (whose powers must be certified by a public notary or public official) and must prove as follows:
a) That the carrying out of the company’s activities or its main activity or activities is not prohibited or restricted in the company’s place of formation, registration or incorporation.
b) That the company has outside the Argentine Republic:
- One or more agencies, branches or representations in good standing and/or
- Fixed non current assets or exploitation rights on third parties’ assets of the same kind and/or
- Interests in any other companies that are not subject to public offer and/or
The company frequently carries out investment operations in stock exchanges or markets as set forth in its purpose.
c) A list of the company’s members at the time the decision to request the company's incorporation is made.
IV. Original receipt of the public notice publication, when the company is a company by shares, an Argentine limited liability company or of a type unknown under the laws of the Argentine Republic, containing:
IV. Original receipt of the public notice publication, when the company is a company by shares, an Argentine limited liability company or of a type unknown under the laws of the Argentine Republic, containing:
a) With respect to the branch, place of business or representation, its principal place of business, allocated capital, if any, and end date of its fiscal year.
b) With respect to its representative, his personal data, constituted special domicile, representation term, if any, restrictions on the agency, if applicable, and nature of his actions in case of appointing more than one representative.
c) With respect to the foreign company, all data set forth in Section 10 of LSC related to its articles of incorporation and any amendments thereto. (See 5: Public Notice).
V. A document in writing including the appointed representative’s signature with a notary public’s certification or personally ratified before incorporation. In such document, the representative shall:
a) State his personal data.
b) Establish the company’s principal place of business, if he is authorized thereto.
c) Establish a special domicile within the boundaries of the Autonomous City of Buenos Aires.
Foreign documentation. Precautions
Any foreign documentation shall be submitted in accordance with all the formal requirements set forth by the Law of its country of origin, authenticated therein and including an apostille or authentication issued by the Argentine Ministry of Foreign Affairs, International Trade and Worship, as the case may be and, if applicable, attaching its version in the national language translated by a sworn translator, whose signature must be authenticated by the Sworn Translators Association or professional entity qualified to that effect.
Notarization
Any foreign documentation that must be registered may be submitted in the form of a public deed notarized before a notary public from the registry of the Argentine Republic, together with its translated version.