1) New rules for establishing foreign companies in Argentina

New rules for establishing foreign companies in Argentina will be effective as of 1 November 2024, greatly simplifying the procedures.

Following the new rules for establishing foreign companies in Argentina enacted by the General Inspectorate of Justice (Inspección General de Justicia, or IGJ after its Spanish acronym), the government agency in charge of the Public Registry in the jurisdiction of the Autonomous City of Buenos Aires, the documents that must be submitted are the following:

i) A certificate attesting to the registration of the foreign company, dated not more than 6 months from the date of filing, issued by the registration authority of the jurisdiction of origin (certificate of good standing);

ii) The articles of association, bylaws and any other incorporation documents, as amended;

iii) The resolution of the competent corporate body of the parent company that decided to set up the branch or establish a subsidiary in Argentina, containing:

a. The decision to register the foreign company to set up a branch or be the partner of a domestic company;

b. The closing date of its fiscal year;

c. The statement that the foreign company is not subject to liquidation or any other legal procedure that imposes restrictions on its assets and activities;

d. The address of the place to be the registered office in the Autonomous City of Buenos Aires, or else the empowerment for the legal representative to fix it;

e. The assigned capital, if any (only for branches);

f. The appointment of the legal representatives in Argentina, listing the powers granted. The legal representative must be an individual.

(iv) Documents showing the identity of the beneficial owners.

Beneficial owners are those individuals who own at least ten percent (10%) of the share capital or voting rights of a company, or those individuals who, by other means, exercise ultimate control of the same.

Final control shall be understood as that exercised, directly or indirectly, by one or more individuals through a chain of ownership and/or through any other means of control and/or when, due to factual or legal circumstances, the same individuals have the power to shape by themselves the corporate will for the decision making by the governing body of the company and/or for the appointment and/or removal of members of the management body thereof.

When it is not possible to identify the individual (s) who is/are the beneficial owner according to the above definition, the beneficial owner shall be deemed to be the individual who is in charge of the management or representation of the company.

• If the beneficial owner is an indirect controller, the following must be submitted: supporting documentation, corporate article of incorporation and bylaws, registers of shares, contracts, transfer of shares, and/or any other document evidencing the chain of ownership and/or control; or
• a detail of the chain of ownership.

The chain of ownership must be described until it reaches the person(s) exercising final control.

In all cases, the respective supporting documentation, corporate by-laws, registers of corporate shares or participations, contracts, transfer of participations, and/or any other document evidencing the chain of ownership and/or control shall be attached.

All documents coming from abroad must be certified by a public notary, where appropriate (both signatures and alleged capacities), and bear the Hague Apostille or the relevant diplomatic legalizations. Company documents may be also certified by the registration authority of the jurisdiction of origin.

2) Repealing of former regulations

The new rules for  establishing foreign companies in Argentina are contained in the General Resolution Nº 15/2024 and repealed several former regulations that made the registration more complex, such as:

i) They do not have to prove that they are not prohibited or restricted from carrying out their activity in their countries of origin;

(ii) They do not need to show evidence that they have economically significant business activity abroad and that the center of management of the foreign companies is located outside Argentina;

(iii) They do not have to identify their partners, although they do have to do so concerning their beneficial owners, if any;

(iv) They are not required to indicate the term of the legal representative’s mandate, the designation of alternates, or the constitution of a postal address and an electronic address of the parent company binding for the companies;

(v) Applications for registration of so-called “off-shore” foreign companies (that is to say, those lacking the capacity and legal standing to act in the territory of the place of their formation), and foreign companies incorporated or registered in territories, associated states, and special tax regimes considered non-cooperative in the fight against money laundering and terrorist financing will be assessed restrictively;

(vi) The change of legal representative is simplified;

(viii) The obligation to submit an annual information regime confirming that they maintain economically significant business activity abroad and that their center of management is located outside Argentina is no longer requested;

(ix) In cases where the notary public of the jurisdiction of origin is not authorized to certify the capacities of those who sign the documents of the foreign company applying for registration, the statement by the officer of the foreign company that he/she has sufficient capacities to execute the act, with his/her signature on said document certified by a notary public, will suffice;

x) The registration of isolated acts executed in the country by foreign companies is eliminated; and

xi) Foreign companies may be registered as vehicles of other foreign companies for developing investments.

xii) The obligation to submit an investment plan is repealed;

xiii) The legal representative or attorney-in-fact of the foreign company is allowed to participate in the corporate acts (e.g. meetings) of local companies in which foreign companies are partners;

xiv) The registration of corporate acts in which unregistered foreign companies participate is permitted, provided that the votes cast by the foreign companies have not been decisive – on their own or in concurrence with those of other participants in the act – for the formation of the corporate will. The omission of registration does not affect the unanimous nature of the meeting; and

xv) The legal representative does not have to provide a guarantee in favor of the local company, except for branches.

3) Conclusions

The new rules for establishing foreign companies in Argentina are part of the deregulation of the legal and business environment that the federal government that took office on 10 December 2023 is firmly embarked on, easing and repealing many superfluous and excessive provisions on corporate issues, labor issues, administrative issues, free of contract, foreign exchange markets, etc., making the country more competitive and attractive again for foreign investments.

Mario E. Castro Sammartino

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