Updated Guide to the Simplified Corporation in Argentina: what to consider when choosing it as a business vehicle

by 20 May 2024Companies, Corporate, Doing business in Argentina

This Guide on the Simplified Corporation in Argentina (hereinafter, we may also refer to this type of company as SAS) will describe the characteristics that must be taken into account to evaluate its choice as a business vehicle. The information is updated as of the date of publication.

1) Introduction to the Simplified Corporation in Argentina

The SAS was created by Law Number 27,349 on Support for Entrepreneurial Activities (Ley de Apoyo al Capital Emprendedor, hereinafter the LACE), as a new type of company specifically regulated outside the General Companies Law No. 19,550 (hereinafter, the LGS).

Under Article Number 33 of the LACE, the Simplified Corporation in Argentina will be governed specifically by LACE´s provisions and supplemented by the appropriate dispositions LGS.

Even though the SAS has been regulated by an act to support entrepreneurship, the new company´s legal use and scope are not restricted to entrepreneurs, and due to its streamlined structure, the SAS can be adopted by many companies of all sizes.

2) According to the LACE, the distinctive characteristics of the Simplified Corporation in Argentina are:

a) Incorporation and good standing of the Simplified Corporation in Argentina

(i) A SAS may be incorporated by one or more individuals or legal entities (LACE, Article Number 34)[1];

(ii) A single-shareholder SAS may not incorporate another single-shareholder SAS, nor may it participate in another single-shareholder SAS (LACE, Article Number 34);

(iii) Under Article 39 of the LACE, for the SAS to be  incorporated and maintain its good standing:

  1. It must not be included in any of the cases of permanent state surveillance provided for in subsections 3), 4), and 5) of Article 299 of the LGS[2];
  2. It may not be controlled by or participate in more than thirty percent of the share capital of companies included in the cases provided for in subsections 3), 4), and 5) of Section 299 of the Corporations Law.

If any of these cases take place, the SAS shall have to be transformed into any other company type foreseen in the LGS within the following six months. Upon expiration of the aforementioned term without the registration of the transformation in the corresponding public registry, the partners will bear unlimited, joint and several liability (LACE, Article Number 39, final paragraph).

 (iv) The SAS may be created by a public, by a private instrument with certified signatures, and by digital means with digital signatures (LACE, Article Number 35). In all cases, the company must be recorded with the Public Registry of the jurisdiction of incorporation (LACE, Article Number 35, second paragraph).

The LACE establishes the content that the constitutive instrument must have, empowering the public registries to approve standard-form models to facilitate registration (Article 36).

A one-day notice of the company´s incorporation shall be published in the Official Gazette of the jurisdiction of incorporation, with a certain content (LACE, Article Number 37).

Provided the shareholders execute the incorporation documents using the templates approved by the relevant Public Registry, the registration must be completed within 24 hours from the next business day after the filing date (LACE, Article Number 38);

b) Corporate name of the Simplified Corporation in Argentina

SAS´ corporate name must contain the expression simplified corporation (Sociedad por Acciones Simplificada), its abbreviation, or the acronym SAS. Failing to comply with this makes the managers or legal representatives unlimitedly, jointly and severally liable for the acts carried out under those conditions (LACE, Article Number 36, Section 2).

c) Corporate purpose of the Simplified Corporation in Argentina

A plural corporate purpose is allowed, with no need for the activities to be connected or related (LACE, Article Number 36, Section 4).

d) Share capital of the Simplified Corporation in Argentina

SAS´ minimum share capital cannot be less than the equivalent of two monthly minimum salaries (LACE, Article Number 40). Should cash be paid out on consideration for the stock, only 25 percent needs to be paid off upfront and the balance within two years afterward. When considerations for the stock are contributions in kind, the stock must be fully paid off at the time of subscription of the shares (LACE, Article Number 41).

Equity is represented by nominatives and non-endorsable shares, either ordinaries or preferred. The company may issue share titles or hold the shares in book-entry form (LACE, Article Number 46). Different kinds of shares with different rights and share premiums may be issued (LACE, Articles Number 44, 46, and 47).

Prior partner´s consent and even straight prohibition to the transfer of shares for a term no longer than ten years may be included in the by-laws (LACE, Article Number 48).

In case the SAS needs urgent financing, under Article Number 45 of the LACE, irrevocable capital contributions on account of future subscription of shares are allowed for a term of 24 months since their acceptance.

In the case of a capital stock increase lower than 50 percent of the recorded stock, the by-laws may authorize to carry it out without any legal notice published in the Official Gazette nor any filing for registration of the partners´ resolution with the Public Registry (LACE, Article Number 44).

Further to the capital contributions, SAS´ partners may also agree upon the performance of accessory services (LACE, Article Number 42, third paragraph).

e) Shareholders´ liability in a Simplified Corporation in Argentina

Under Article Number 34 of LACE, SAS´ shareholders limit their liability to paying off the shares they have subscribed. However, all shareholders assume a legal unlimited, joint and several liability vis-a-vis third parties for the effective execution of the full contributions the partners have committed themselves to (LACE, Article Number 43).

f) Corporate governance of the Simplified Corporation in Argentina

The SAS´ partners are legally entitled to decide on the company´s organizational structure, laying out the provisions governing the company´s bodies. The management, government, and audit bodies will operate following the LACE´s provisions, the by-laws, and, additionally, the Limited Liability Company´s regulations and the LGS´ general dispositions (LACE, Article Number 49).

The management and government bodies may call themselves to hold deliberations, with no need for prior notice (LACE, Article Number 49, third paragraph). The management body´s resolutions will be valid as long as all members attend and the majorities foreseen in the by-laws approve the agenda. The government body´s resolutions will be valid provided that all partners attend and the agenda is unanimously passed (LACE, Article Number 49, third paragraph).

Management and legal representation

The SAS´ managers are to be individuals, either partners or not. They may be appointed for an indefinite period (LACE, Article Number 50), and the administration may be individual, plural, or through a collegiate body (LACE, Article Number 51). The appointment of an alternate manager is mandatory when the company lacks an audit body. The appointments and terminations of the managers must be registered in the Public Registry (LACE, Article No. 50). (LACE, Article Number 50).

Managers may be Argentine citizens or foreign individuals, and only one of them must reside in Argentina. Foreign managers must get a tax ID (Clave de Identificación or CDI), appoint a legal representative in Argentina, and set a legal address in the country (LACE, Article Number 51).

Managers need not provide a guarantee for the performance of their duties.

SAS are not required to file their balance sheets with the Public Registry.

The legal representation of the SAS may also be in charge of one or more individuals, partners or not, appointed in the manner provided for in the articles of incorporation. In the absence of any provision in the articles of incorporation, the appointment will be made by the shareholders’ meeting or, as the case may be, by the sole shareholder. The legal representative may enter into and execute all acts and contracts included in the corporate purpose or directly or indirectly related thereto (LACE, Article 51, final paragraph).

Partners´ decision-making

The shareholders’ meeting is the governing body of the SAS.

The partners´ decisions may be adopted through meetings or consultation procedures agreed upon in the by-laws. Unlike any other commercial companies, SAS´ board and shareholders meetings can be held not only at the registered office but also at any other place, by any means allowing the partners and any other participants to simultaneously communicate among themselves (LACE, Article Number 53, second paragraph).


Auditing bodies are optional (LACE, Article Number 53, final paragraph).

g) Transformation into a Simplified Corporation in Argentina

Any company incorporated under the provisions of the LGS (e.g. corporations, limited liability companies, single-shareholder companies) may be transformed into a SAS (LACE, Article Number 61).

h) Dispute resolution in the Simplified Corporation in Argentina

By-laws may provide for arbitration as the dispute resolution method (LACE, Article Number 57).

i) Company´s document and bookkeeping in a Simplified Corporation in Argentina

The SAS shall be able to carry their corporate and accounting books by electronic means (LACE, Article Number 58). Likewise, powers of attorney will be allowed to be granted in electronic notarial records (LACE, Article Number 59).

3) In the jurisdiction of the Autonomous City of Buenos Aires, the General Inspection of Justice (hereinafter referred to as the IGJ), in charge of the Public Registry, has regulated the Simplified Corporation, being of interest for this guide to highlight that:

(i) The IGJ has approved the templates of the incorporation instrument[3], and the incorporation notices[4];

(ii) The IGJ will be exclusively in charge of registry functions. The SAS will not be subject to the IGJ’s supervision during its operation, dissolution, and liquidation, not even in cases where its share capital exceeds the amount provided for in section 299, subsection 2 of the LGS (article 2)[5];

(iii) It is allowed to compute the expenses of incorporation and registration of the company as part of the integration of the capital.

4) Conclusions

The Simplified Corporation in Argentina is a very flexible type of company, adaptable to any size of operation. It has significant advantages, both for family businesses and for large local or multinational companies wishing to establish themselves in the country. Its structural restrictions are very few and its benefits in terms of ease of incorporation and management are many.

Notwithstanding the above, the choice of the most appropriate corporate type should always depend on a personalized and careful evaluation of the needs of the company, the business to be carried out, the planning of the best group and tax structure, among other factors, which will require specialized professional advice.

Mario E. Castro Sammartino 

[1] Under Argentine Law, the Single-Shareholder Company (Sociedad Anónima Unipersonal) and the SAS are the only legal vehicles that allow for a single partner. To read about single-shareholder companies, please, see our Legal Blog: https://cspabogados.com.ar/en/amendments-to-single-shareholder-companies-in-argentina/

[2] According to Section 299 of the LGS, the government exercises permanent control over the following companies:

(i) Those that offer their equity or debt securities to the general public;

(ii) Those whose corporate capital is above pesos two billion ($ 2,000,000,000,000) (amount established by Article 1 of Resolution No. 10/2024 of the National Ministry of Justice);

(iii) State-participated corporations, either by the participation of the national State, the provincial states, the Autonomous City of Buenos Aires, the municipalities, and/or the state agencies legally authorized for such purpose. (Subsection substituted by Article 49 of Necessity and Urgency Decree No. 70/2023);

(iv) Those engaging in capitalization or savings and loan operations, or otherwise soliciting funds or commercial papers from the public with the promise of future considerations or benefits;

(v) Those operating government concessions or public utilities;

(vi) Any corporation that controls or is controlled by another that is comprised in one of the situations mentioned above;

(vii) Single-Shareholder Corporations (section incorporated by item 2.26 of Annex II of Law No. 26,994. Text according to Section 1 of Law No. 27,077).

[3] Available here: http://servicios.infoleg.gob.ar/infolegInternet/anexos/395000-399999/398008/norma.htm

[4] Available here: http://servicios.infoleg.gob.ar/infolegInternet/anexos/395000-399999/398008/norma.htm

[5] See footnote 2.

For additional information on these or any other issues related to doing business in Argentina, please, sign up for our Legal Blog or contact us at any time. Our publications exclusively express the author´s opinion and do not purport to be legal counsel on any case. Should you need it, you must consult with your trusted lawyer.​

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