07 Sep Patents Trademarks Argentina
Patents Trademarks Argentina
Requirements for an Argentina LLC (SRL)
The SRL is one of the most commonly used legal structures, after the SA.
Partners: There must be at least two and no more than 50 partners (with the Superintendency of Corporations applying the same 95% maximum limit on the ownership of capital by a single partner that applies to an SA). Partners can be domestic or foreign companies or individuals (but may not be domestic corporations) and no nationality or residence requirements apply. The liability of a partner is limited to the full payment of the equity participation subscribed by the partner.
There is no minimum capital requirement. As in the case of an SA, however, the Superintendency of Corporations requires the capital to be appropriate for the SRL’s purpose and may request that an SRL set a higher amount of capital than that decided on by the partners. The capital must be subscribed in full and 25% must be paid in at the time of incorporation, with the balance paid in within two years. Contributions of capital other than cash must be fully paid in at the time of incorporation.
As a matter of fact, one or more managers will be in charge of managerial duties. Also, they may act individually or jointly, as set forth in the articles of incorporation. Additionally, managers are not subject to nationality requirements. For instance, if the managers act jointly or there is only one manager, an absolute majority of all the managers appointed by the partners must reside in Argentina. Last, managers need not be partners.
Indeed, the adoption of company resolutions is as set forth in the bylaws of incorporation. Also, if a sole partner represents the majority vote, amendments to the bylaws require the vote of another partner.
There is no requirement for labor representation to be part of the board or the management.
Branch of a foreign corporation
A foreign company may set up a branch in Argentina.
Firstly, an application for branch registration should be in Spanish. A local Notary Public should notarize file it. In addition, it should include the articles of incorporation and bylaws of the head office. Also, it should include a copy of the resolution setting up the Argentine branch. In general, there is no need for a branch to have a specific amount of capital. Thus, for management purposes, only a legal representative duly authorized to operate the branch must be appointed. The branch must keep accounts separate from those of its head office and must file annual financial statements with the Superintendency of Corporations. Different requirements apply to branches in Buenos Aires City.
In conclusion, foreign corporations usually operate in Argentina through a separately incorporated subsidiary, rather than a branch. Primarily to minimize potential legal liability. For instance, if a branch faces a lawsuit, all of the foreign corporation’s assets, not just its domestic assets, may be subject to liability. In contrast, if a subsidiary faces a lawsuit, the foreign corporation’s liability generally would limit to the assets of the subsidiary.