Succession in Montevideo, Uruguay Probate Punta del Este Estate Lawyers URU Attorneys UY Law Firm

Succession in Montevideo, Uruguay Probate Punta del Este Estate Lawyers URU Attorneys UY Law Firm








 

Legal Consultation? FAQ from Montevideo Uruguay Law Firm – Attorneys at Law – Lawyers

Uruguayan Law Firm Attorneys Lawyers

Uruguayan Law Firm Attorneys Lawyers

1. Is there any limitation imposed on foreigners for the purchase of property of Real Estate in Uruguay?

There is no kind of limitation imposed on foreigners for the purchase of property of any kind in Uruguay and there are also no requirements for such foreigners to set up any kind of domicile in the Uruguayan country. Any person or legal entity, regardless of its nationality or place of domicile, may invest in real estate in Uruguay, whether in the occasion of tourism or other reasons with no limitations of any kind and when selling their property they may repatriate the funds of this investment without the need of any kind of authorization or intervention by the Uruguayan authorities.

2. Does the Uruguayan tax system discriminate against foreign investment?

The Uruguayan tax system does not discriminate against foreign investment. However, the Uruguayan tax regime is influenced by the legal vehicle adopted to acquire real estate or perform activities in Uruguay.

3. Are there any Currency and Exchange controls in Uruguay?

The Uruguayan exchange market operates under complete freedom of transaction and holdings in currency and metals. Uruguay has maintained a foreign exchange policy that complements the framework of the liberalization of the economy. The financial exchange market is fully liberalized, and the purchase and sale of foreign exchange are subject to no restrictions. Similarly, there is total freedom in transfers and remittances to and from the country in any currency. This includes bitcoins and all other cryptocurrencies in Uruguay.

4. All documents coming from abroad must be legalized?

Yes. For foreigners coming to Uruguay, it is important to understand that this country is not a signatory to the Hague Convention regarding the legalization of documentation by means of the “apostille”. All documents coming from abroad must be legalized before the Uruguayan consulate of the place in which the document is originated or before the Uruguayan consulate with jurisdiction over such place. This law may change in 2017. Uruguay plans to become an Apostille country same as Argentina already is one.

5. Crime and Corruption vs Transparency in Uruguay

Uruguay has strong laws to prevent bribery and other corrupt practices. In 2005, Uruguay was ranked second best in Latin America (after Chile) according to Transparency International’s Corruption Perception Index.

6. How can I obtain the Residence and Citizenship in Uruguay?

Obtaining a resident permit in Uruguay does not pose great difficulties. Foreigners are admitted to reside permanently in Uruguay if they comply with the following three general principles: a) they must be of good health, b) they must prove to be of good conduct and not have any criminal background and, c) they must have the means to support themselves as well as their families while staying in Uruguay. Legal citizenship may be obtained by non-nationals if they have resided in the country for a term of at least three years (if they have settled down with their families), or of five years (in case they don’t have a family) and in both cases, they must all be of good conduct (clean legal background).

7. Are there other forms of ownership in Uruguay?

Uruguayan law contemplates the possibility of separating legal title to a property from the right of beneficial use over the same. In this way title to all realty is divided between the holder of the legal title (“nudo-propietario”) and the holder of the usufruct or of the right to use and benefit from such property (“usufructuario”). Upon expiration of the term for which title to the usufruct has been transferred or the demise of the person in favor of which such right to use or benefit from such property has been transferred, full title to the property is returned to the holder of the legal title.

8. Can realty owned by foreigners be leased in Uruguay?

An interest in real property may also be transferred in the form of a lease. A lease conveys the right to use and benefit from the property for a period of time as if the lessee were the owner, subject to the limitations contained in the lease agreement and for the term of the lease. However, at the expiration of the term of the agreement, possession returns to the lessor and lessee loses all rights to the property. The law limits the term of lease agreements to a maximum of 15 years.

 

9. Which is the legal regime for country clubs?

The legal existence and property rights over the units of a country club, the administration of the same and the rights and

uruguay montevideo

Uruguay Montevideo

obligations of the owners of such units are governed by law 10.751 and law 17.292 (said laws, hereinafter the “Law”). The Law establishes the requirements for considering the plots as individual real estate units, the rights of the individual owners of each unit over the areas of the country club which are for the common use of all of the proprietors of the units which are part of the building.

In general, it may be stated that such units are recognized by law as separate real property upon the granting of the municipal approval of the infrastructure works of the country club; the registration of the plans of the project and the execution and registration of the “Reglamento de Copropiedad” establishing a mortgage over each of the units of the country club in favor of the other co-owners as security for the payment of common expenses.

Notwithstanding the above, the execution and registration of promises of sale over units with respect to which the above steps have yet not been completed and therefore are still no recognized as independent property is admissible by law.

According to the abovementioned, it is mandatory that the country club has a “Reglamento de Copropiedad”, which rule with detail the administration of the country club and the rights and obligations of the owners of the various units with respect to the upkeep of the country club and their contribution to of one single child the percentage of the estate the testator is allowed to dispose of is fifty percent of his estate, in the event of two, that percentage is of one third, and in the case of three or more, the percentage is reduced to one-quarter of the estate. If there are no children and the forceful heir or heirs are one or both parents, the testator may dispose freely of fifty percent of his estate.

In the case that the owner of a real estate property located in Uruguay dies, the correspondent heirs must carry out the inheritance judicial procedure in Uruguay in order to obtain a judicial declaration of heirs.

10. Inheritance laws in Uruguay

Under Uruguayan Law, upon the death of a person who has died intestate (without any testament o will), the direct descendants of the deceased, whether legitimate or natural and in their absence, his or her ascendants together with the surviving spouse are considered as heirs of the estate of the deceased. In the absence of both parents and spouse, the siblings of the deceased whether legitimate or natural, together with his adopted children are considered as his heirs.

The law considers the direct descendants of the deceased, whether legitimate or natural and in their absence his or her parents, as “forceful heirs” and reserves for such class of heirs a portion of the estate.

Even by means of a will, a person who at the time of his death has “forceful heirs” may not dispose of more than a certain percentage of his estate in the benefit of third parties or may not alter the percentage of the estate that corresponds to any one of such “forceful heirs”. The percentage of the estate to be assigned to such heirs depends upon their number. In the case of one single child, the percentage of the estate the testator is allowed to dispose of is fifty percent of his estate, in the event of two, that percentage is of one third, and in the case of three or more, the percentage is reduced to one-quarter of the estate. If there are no children and the forceful heir or heirs are one or both parents, the testator may dispose freely of fifty percent of his estate.

In the case that the owner of a real estate property located in Uruguay dies, the correspondent heirs must carry out the inheritance judicial procedure in Uruguay in order to obtain a judicial declaration of heirs.

11. Wills

The Uruguay Civil Code contemplates the existence of two kinds of wills: the solemn open will which must be executed before a notary public and before three witnesses in the form of a public deed and the solemnly closed will which is executed in the form of a private document and delivered to a notary public, before five witnesses to be introduced into an envelope, which is duly sealed and stamped to assure that it may not be replaced.

The Civil Code contemplates for very special circumstances the possibility of less solemn wills, but the general principle is that wills executed in the form of private documents or which do not follow the legally prescribed solemnities are considered null and void and produce no effects.

12. Registration of real estate rights

Uruguay has excellent real estate legislation akin to the Torrens System, under which title to real estate and all rights pertaining to real estate, in order to be valid before third parties, must be registered before the pertinent public registry. The chronological order in which such rights are registered gives precedence to the various rights registered with respect to a property. The system is so safe that title insurance is unheard of in the country.

Further, all real estate transactions and most contracts which create rights such as security rights over real estate must be executed before a notary public (“Escribano”) in the form of a public deed and registered with the registry of real estate of the department of the location of the land in question.

13. Structure of all Real estate operations in Uruguay

A) THE PRELIMINARY AGREEMENT

It is customary that the parties, upon reaching an agreement for the purchase and sale of any kind of realty, whether of an urban building, a summer house or a ranch, execute a preliminary agreement, usually called a “Boleto de Reserva”.

Usually, the preliminary agreement will establish a term of 30 to 60 days to conduct the due diligence work and title search with respect to the property and will subject the execution of the final agreement to the existence of good and clean title in the name of the seller.

The Boleto de Reserva, similarly to a memorandum of understanding, states the main terms and conditions of the projected deal.

B) THE REGISTERED PROMISE OF SALE

Uruguayan law contemplates, in the event of a realty transaction where the purchase price is to be paid in more than one installment, the execution of a promise of sale to be executed before a Escribano and substantially in the form of a definitive purchase and sale agreement which, upon registration with the real estate registry shall grant full protection to the rights to the promissory buyer over the property in question with respect to any other right created over such land, any attachment or encumbrance ordered or imposed by a competent court with respect of the same or any other circumstance which could affect the right of the vendor to dispose of its property which may be registered subsequently to the registration of the promise of sale.

This law contemplates the possibility that in the event of the vendor were to default in his obligation to execute the purchase and sale agreement or were unable to do so for any reason (including his death, liquidation, bankruptcy, etc), the pertinent court, upon verification that the purchase price has been paid in full or of the deposit of the purchase price before such court, shall execute the conveyance of the property to the vendee on behalf of the vendor.

C) PURCHASE AND SALE AGREEMENT

As stated above, purchase and sale agreements, as well as the promise of sale the object of which is real estate, must be executed before an Escribano in his books. A sale and purchase agreement executed in a private document is null and void and produces no effects.

The registration of the purchase and sale deed will cause it to be valid and in force before third parties as from the moment of registration. If not registered, the agreement will only be valid between the parties thereto.

14. Taxes and pension funds contributions applicable to real estate transactions

A) LAND TRANSFER TAX

All real estate transactions are subject to a land transfer tax (the “LTT”) equivalent to two percent (2%) of the fiscal value of the property which is paid both by the buyer and by the seller. Generally, the fiscal value of the property is considerably lower than its market value, and at risk of generalizing may be estimated at close to 50% of the market price, though of course, in some cases this estimate may not be too accurate.

The LTT is deposited with the Escribano upon the execution either of the promise of sale or the purchase and sale agreement, and it is he who will proceed to its payment prior to registration of the deed.

When prior to the execution of a purchase and sale agreement, the parties have entered into a promise of sale agreement, in the occasion of which the LTT has been paid, then such tax is not paid again at the moment of execution of the purchase and sale agreement.

B) PENSION FUNDS CONTRIBUTIONS

Another expense to take into account is the pension funds contributions on the fees of the Escribano, which add up to approximately 0,55% plus VAT (22%) of the purchase price. Originally a part of the notary’s fees currently it has become customary to consider them as a separate expense.

15. Spouses Legal Regime

According to the Uruguayan conflict of law rules, the spouse’s legal regime regarding the goods acquired during their marriage is one of the countries in which the spouses had their first domicile.

Therefore, should the first domicile of the spouses was abroad then the law of such a country would regulate the regime of goods of the spouses.

Uruguay Estate Probate Law Firm Limeres.com Successions Inheritance Wills Trust Lawyers Attorneys

Uruguay Estate Probate Law Firm Limeres Successions Inheritance Wills Trust Lawyers Attorneys limeres.com

Uruguay’s Population and language

According to the last census (2011), the population of Uruguay is a bit more than 3.2 million.
Approximately 95% of the whole population lives in urban areas – about 60% live in Montevideo and its surrounding areas.
There is no indigenous population; most Uruguayans are descended from Europeans (mainly Spanish and Italian).
Spanish is the official and most used language.
English is the most used foreign language in the business community. Currently, Portuguese is also widespread as a result of having a long border with Brazil and because of the trade and tourism between both countries.
Political system and government
Uruguay has long-standing traditions of democracy and legal and social stability and a solid financial and legal framework that is attractive to foreign investors contemplating business ventures in the region.
Politically, Uruguay has a democratic republic system, with a presidential regime and three consolidated political parties. The government is divided into three independent branches: Executive, Legislative and Judicial.
The Executive Branch is administered by the President of the Republic, who acts together with the Vice President and the Ministerial Council. The President and the Vice President are elected through universal, popular, direct vote and the Ministers are designated by the President.

The Legislative Branch consists of the General Assembly, which includes the Vice President, a 30-member Chamber of Senators and a 99-member Chamber of Representatives. Parliamentary elections are held at the same time as presidential elections (last Sunday of October every ve years – last election was held in 2009).

Uruguay has a two-round system for presidential elections. In case the candidate for President with more votes in the election of last Sunday of October does not reach the 50% plus one of the valid votes, then there is a runoff with the second most voted candidate, on the last Sunday of November of the same year.

The President, Vice President, Senators, and Representatives serve a ve-year term. The Vice President, the Senators and the Representatives can be consecutively re-elected, but the President can not.

The Judicial System is administered by the Judicial Power, one of the three State Powers. Its jurisdiction is national. It is divided into Courts and Tribunals. The system adopted for the judiciary is the collegiate one for higher organisms (Supreme Court of Justice – the highest hierarchy Justice Body and Appeal Tribunals) and the one-man system for the lower organisms (Courts and Peace Courts).

State governments are elected in a separate election from the Presidential and each state chooses its own public authorities. Each state has an “Intendente” (Governor) and a Legislative Branch of 30 members, where the majority (at minimum) belongs to the party of the Governor that has won the state election.

Location and weather

Uruguay is located in South America with coasts on the Atlantic Ocean, between Brazil and Argentina. It has a land surface area of 176,215 km2 and a total area of 318,413 km2 when considering rivers and territorial waters.

The country is divided geographically into 19 states (“departamentos”) with Montevideo as its capital. The largest cities are Montevideo, Salto and Paysandú, last both on the shore of Rio Uruguay, the river that is the borderline with Argentina.

It is the only South American country that lies entirely in a temperate zone. Due to this, it has small variations in temperature, precipitation, and other climatic factors.

There are no remarkable topographic features. Most of the country consists of gently undulating plains crossed by long rivers. The climate is mild and healthy throughout the year. Temperatures average 62° to 82°F (17° to 28°C) in summer and 42° to 57°F (6° to 14°C) in winter. Rainfall occurs in all seasons but is generally heavier in the autumn months.

Its weather and topographic is especially suitable for agriculture, forest, and livestock production.

Why Uruguay?

Its location, infrastructure, and natural conditions enable complete and easy access to the largest economies in the region.

A tradition of respect for political, social and economic freedom, as well as solid institutions, ensures a stable framework.

Uruguayans are family-oriented and human relations often play an important role.

According to the 2013 Legatum Prosperity Index, Uruguay is the best place to live in Latin America. It is ranked 30, ahead of Chile, Argentina, and Brazil. The ranking is based on a variety of factors including wealth, economic growth and quality of life and it covered 142 countries, 96% of the world’s population and 99% of the world’s GDP.

Additionally, Uruguay ranks as one of the safest countries in Latin America (with Chile and Costa Rica) regarding the Latin Security Index that measures security for multinational executives, the index developed by Consulting for Latin Business Chronicle.

According to the 2013 Global Peace Index, which ranks 162 countries by measuring security in society, the extent of con ICT and the degree of militarisation, Uruguay is in the first position in Latin America and 24 globally speaking.

Also, Uruguay maintains a “high” level of human development, ranking in 2013 among the top three in the region and 51st worldwide, according to the United Nations index that each year reflects the quality of life in different countries.

In accordance with the Mercer 2012 Quality of Living Worldwide City Rankings that survey 221 global cities -using New York as the base city for comparisons-, Montevideo ranks #77 overall and emerges as the #1 city in South America. Factors such as internal stability, law enforcement effectiveness, crime levels, medical facilities, infrastructure, public transportation, and international right connections are all taken into consideration by the Mercer research team.








Living in Uruguay

In Uruguay, people enjoy a safe, peaceful and healthy environment. Public meetings take place peacefully.

Traffic in vehicles, even in urban centers, issued. Montevideo can be crossed by car from one end to another in just an hour, at any time of the day.

Cities have large green spaces, and because of the continuity of the wind and the absence of polluting industries, there is no pollution.

Epidemics of any kind are practically non-existent.

The distances to access recreational areas (e.g. the countryside, beaches and shores of rivers) are short. The most popular resort town (Punta del Este) is 140 km east of Montevideo.

All major cities are connected by routes that have their origin in Montevideo (South-North). Also, there are some important routes that cross the country East-West.

The national sport is soccer.

There are many private clubs where to practice sports, including golf, tennis, soccer, rugby, squash, etc.

There is also a strong cultural activity in Uruguay which results in an adequate range of theatres, cinemas, and music shows.

 








 

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