Corporate reforms in Argentina
The Emergency Decree N° 70/2023 (hereinafter, the Decree) introduces several reforms to state-owned companies and private entities.
1) Private entities
The Decree amends Section 30 of the General Companies Law N° 19,550 (Ley General de Sociedades, hereinafter the LGS), allowing non-profit entities to take interest in corporations (sociedades anónimas), and enter into any associative contract.
Non-profit entities may transform into a commercial company or decide to be a shareholder of a corporation by way of the vote of two-thirds of their associates (Section 77, 1) of the LGS, as amended by the Decree).
These new provisions, within the background of the amendments to Sport Law No. 20,655, will also allow football clubs to transform into corporations.
2) State-owned companies
Within its crystal-clear orientation towards significant deregulation of the economy, the Decree considers a cornerstone of its policies the reform of the legal regime of companies owned by the National State.
These public companies will be transformed into corporations, comprehending state-owned entities not having a corporate legal form, State-owned Companies, Corporations with Majority State Holdings, Mixed Economy Companies, and all other entities where the National State has an interest in the capital or the adoption of corporate decisions, and are not formed as corporations (Section 48).
Further, those companies in which the National State is a shareholder shall not enjoy any public law prerogative, nor may the National State provide advantages in the contracting or purchase of goods and services, nor prioritize or grant benefits of any kind, scope or nature in any legal relationship in which it is involved (Section 50).
For a general introduction to the new legal and business environment of Argentina, please, see our post: https://cspabogados.com.ar/en/new-legal-and-business-environment-in-argentina/.
Mario E. Castro Sammartino
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