Argentina: The New Business Form – Simplified Corporations (SAS) In Argentina: Converting Into Simplified Corporations

Last Updated: 1 February 2018
Article by Canosa Abogados

Conversion into SAS.

Business entities incorporated in accordance with the Companies Law may adopt the SAS form. Below is a sample of Articles of Incorporation and Bylaws of a Simplified Corporation.

Sample of Articles of Incorporation and Bylaws of a SAS.

Articles of Incorporation and Bylaws of "[corporate name] S.A.S".

These Articles of Incorporation and Bylaws are entered into in the Autonomous City of Buenos Aires, Argentina, on [date of Articles of Incorporation], between:

  1. [Full name of the shareholder], [type of identification document and its number], [CUIT/CUIL/CDI], [nationality], born on [birth date], [occupation], [marital status], domiciled at [full address], represented by [full name of attorney-in-fact], [type of identification document and its number] [CUIT/CUIL/CDI], and
  2. [Name of the legal person], place of business [ full address], who declares under oath that it is not comprised in the cases provided for in Section 299 of the Companies Law (Law No. 19550), represented by [Full name of its legal representative(s)], [Type of tax identification and ,its number], [CUIT/CUIL/CDI], registered with the Public Registry of Commerce (IGJ) under number [number of registration]on [date of registration],

who decide to incorporate a Simplified Corporation [sole shareholder], pursuant to the following clauses:

1. CLAUSES:

SECTION ONE. Corporate name and domicile. The name of the corporation is "[name]" and the principal place of business is located in the Autonomous City of Buenos Aires. The Corporation may have any other offices or branches either within or without Argentina.

SECTION TWO. Term. The term of existence of the corporation is 99 years as from the date of the incorporation. This term may be extended by shareholders' resolution.

SECTION THREE. Purpose. The corporation is organized for the purpose of creating, producing, exchanging, manufacturing, transforming, trading, intervening, representing, importing and exporting, either alone, through third parties or in cooperation with others, within or without Argentina, tangible assets including natural resources, or intangible assets, and rendering services directly or indirectly related to the following activities: (a)agriculture, poultry, livestock, fishing, farming and winemaking; (b)communications, shows, editorial and graphic activities in any format; (c)cultural and educational activities; (d) development of technologies, investigation and innovation, and software; (e)gastronomic, hotel and tourist activities; (f)real estate and constructions; (g)investment, financing and trusts; (h)oil, gas, forest, mining and energy activities in all kinds; (i)health; and (j) transport. The corporation has full powers to carry out all lawful activities and acquire rights and undertake obligations either within or without Argentina. For conducting the activities described in its purpose, the corporation may make investments and capital contributions to legal or natural persons, act as trustee and enter into cooperation agreements; purchase, sell and/or trade all kinds of securities; grant or obtain loans and carry out all kinds of financial transactions, excluding the operations falling within the scope of the Financial Entities Law and any other transaction requiring a competitive process and/or public funds.

SECTION FOUR. Capital. The corporate capital is $ [pesos in numbers] (*) and it is divided into book-entry shares of common stock, $1 per value per share. Each share shall entitle its holder to one vote. Capital may be increased upon resolution of the shareholders pursuant to section 44 of Law No. 27,349. Book-entry shares related to future capital increases may be common or preferred, according to the resolution at the shareholders' meeting. Preferred shares may hold the right to fixed dividend payment which may be cumulative or not, in accordance with conditions of issuance. These shares may hold the right to an additional dividend on realized net profits, and may grant the shareholder a priority on the reimbursement of his contribution upon the corporate liquidation. Common shares shall entitle the holders to one to five votes per share. Preferred shares may hold voting rights or not, except for the matters indicated in section 214, fourth paragraph of the Companies Law (Law No. 19,550), notwithstanding the right to attend and speak at the shareholders' meeting.

SECTION FIVE. Default in the payment of the subscribed contribution. The payment of the subscribed contribution shall be in default upon the date of expiration. The corporation may choose any of the alternatives set forth in section 193 of the Companies Law (Law No. 19,550).

SECTION SIX. Transfer of shares: The shares may be freely transferred. Notice of the transfer shall be served to the corporation.

SECTION SEVEN. Management body: The business and affairs of the corporation shall be managed by one or more human persons, shareholders or not, with the number to be designated from time to time, and shall not be less than 1 (one) nor more than five (5). The management body shall be in charge of the representation of the corporation. When the management body is composed by more than one person, the managers shall be in charge of the management and representation indistinctly. The managers' term of office is indefinite. When the corporation has no auditing body, an alternate manager shall be appointed. When the corporation has only one shareholder, he may exercise all the powers conferred by law to the corporate bodies, so long as they are compatible, including management and legal representation. When the management body is composed by more than one manager, notice of the meeting of the management body and the information of the order of business shall be served by reliable means or by digital means, in which case, receipt must be ensured. The meetings shall be held at the place of business or at any other place, using the means necessary for members to communicate with each other simultaneously. The minutes of the meeting shall be drawn up in accordance with section 51, paragraph 3, Law No. 27,349. The resolutions shall be adopted by the vote of the majority. Managers may hold self-convened meetings to deliberate without prior notice, in which case, adopted resolutions shall be valid if all the managers were present and the order of business was approved by the majority vote. All resolutions shall be registered in the Minutes Book. The corporation shall be liable for the lawful acts performed by the person in charge of the corporate representation within the corporate purpose.

SECTION EIGHT. Governing body: The shareholders' meeting shall be held when required by any manager. Notice of the meeting shall be made by reliable means and also by digital means, in which case receipt shall be ensured. Meetings may be held in the place of business or at any other place, using the means necessary for shareholders to communicate with each other simultaneously, subject to the requirements set forth in the second paragraph of Section 53, Law No. 27,349. Resolutions concerning the amendment of the Articles of Incorporation or the dissolution of the corporation shall be adopted by the vote of the majority of the stock of the corporation. Other resolutions, such as the appointment or removal of managers, shall be adopted by the majority vote of the shareholders present. In no event the vote of another shareholder shall be required when one shareholder represents the majority vote to adopt resolutions. Notwithstanding this, resolutions adopted by shareholders shall be valid upon notice to the management body by any means within ten (10) days after the simultaneous consult by a reliable means, as well as written resolutions in which all shareholders expressed their vote. When the corporation has only one shareholder, resolutions shall be adopted by this shareholder. All resolutions shall be recorded in the Minutes Book. Shareholders may hold self-convened meetings, and their resolutions shall be valid if all members representing the total amount of the capital are present and the order of business is approved unanimously.

SECTION NINE. Auditing body. The corporation lacks an auditing body.

SECTION TEN. Business year-end. The business year of the corporation ends on [closing date] of each year, on which financial statements shall be made in accordance with the accounting legislation in force. The management body shall put the financial statements at the shareholders' disposal at least fifteen (15) days before the shareholders' meeting is held.

SECTION ELEVEN. Profits, reserves and distribution: Net realized profits shall be distributed as follows: (a) five percent (5%) shall be allocated to the legal reserve, until they reach twenty percent (20%) of the corporate capital; (b) the amount established for managers and auditors, when applicable; (c) the payment of dividends on preferred shares, when applicable; and (d) the remaining amount shall be distributed among the shareholders in proportion to their capital share and considering the rights of preferred shares.

SECTION TWELVE. Dissolution and liquidation: Following the dissolution of the corporation, the liquidation shall be made by the managers in accordance with Section 7 hereof. Once debts are cancelled and capital is reimbursed considering the rights of preferred shares, the remaining amount, if any, shall be distributed among the shareholders in proportion to their share capital.

SECTION THIRTEEN. Dispute resolution: Any dispute arising between the corporation, shareholders, managers, and the members of the auditing body, if any, shall be subject to the commercial courts in and for the Autonomous City of Buenos Aires.

  1. TRANSITIONAL PROVISIONS: The parties hereto agree the following:
  2. DOMICILE. The Corporation is domiciled at [street and number], [floor], [office], Autonomous City of Buenos Aires.
  3. CORPORATE CAPITAL: The shareholders agree to subscribe 100% of the corporate capital as follows: (a) [full name of shareholder 1], subscribes [amount of shares], book-entry shares of common stock, one peso per value per share, with one voting right per share. (b) [full name of shareholder 2], subscribes [amount of shares], book-entry shares of common stock, one peso per value per share, with one voting right per share. (c) [corporate name, corporate structure], subscribes [amount of shares], book-entry shares of common stock, one peso per value per share, with one voting right per share. The corporate capital shall be composed of 25% cash, as evidenced by [ receipt of the expenses incurred for the incorporation of the corporation/deposit certificate of Banco de la Nación Argentina/notarial act], the pending capital amount shall be paid in a 2-year term, as from the date of incorporation.
  4. APPOINTMENT OF THE MEMBERS OF THE MANAGEMENT BODY. AFFIDAVIT RELATED TO THE CONDITION OF POLITICALLY EXPOSED PERSON. The following persons are hereby appointed as (regular manager/s): [full name of the regular manager], [type of identity document], No. [number of the identity document], [number of CUIT/CUIL/CDI of manager], [nationality], born on [date], domiciled at [street, number, floor, office, city, province], who hereby accepts the position and establishes special domicile at the corporate place of business, and declares that he [IS/IS NOT] a Politically Exposed Person, pursuant to the Rules of the Financial Information Unit, [subsection] of FIU Resolution No. 11/11. (alternate manager): [full name of the alternate manager], [type of identity document], No. [number of the identity document], [number of CUIT/CUIL/CDI of the manager], [nationality], born on [date], domiciled at [street, number, floor, office, city, province], hereby accepts the position and establishes special domicile at the corporate place of business, and declares that he [IS/IS NOT] a Politically Exposed Person, pursuant to the Rules of the Financial Information Unit, [subsection] of FIU Resolution No. 11/11. The legal representation of the corporation shall be exercised by the appointed manager(s).
  5. FINAL BENEFICIARY AFFIDAVIT. Pursuant to the rules in force related to the anti-money laundering and combating the financing of terrorism, [full name of the final beneficiary], [type of identity document], No. [number of identity document], [type of tax identity document], [number of tax identity code], [nationality], [complete domicile of the final beneficiary], hereby declares that he is the final beneficiary of the legal entity in a [percentage]. I,[full name of manager I], in my capacity as legal representative, hereby declare that there is no individual who is the final beneficiary, pursuant to section 510, subsection 6 of General Resolution No. 7/2017 of the Business Entities' Controlling Body [Inspección General de Justicia].
  6. SPECIAL POWER OF ATTORNEY. A special power of attorney is hereby granted to [full name of authorized person 1], [type of identity document], [No. of identity document], and/or [full name of the authorized person 2], [type of identity document], [No. of identity document], to perform either jointly or separately, all acts necessary for the filing of the corporation with the Public Registry of Commerce. For this purpose, the abovementioned persons have the power to accept or discuss amendments to the Articles of Incorporation and Bylaws, including the corporate name, grant additional private and/or public instruments and individualize the digital records of the corporation before the Public Registry. In addition, they have the power to perform all acts before financial entities, the Argentine tax authorities (A.F.I.P.), DGI Tax Agency, the tax authorities in and for the Autonomous City of Buenos Aires (A.G.I.P.), Revenues Departments and Customs Department and/or any other public or private body. They are also authorized to request the publishing of legal notice in the official gazette. (*) In the event the corporation has the statutory minimum capital, said amount must be indicated in Argentine pesos which must be equivalent to two adjustable minimum living wages current at the date of the incorporation of the SAS (section 40, Law 27349). Otherwise, the corporate capital must be indicated as agreed by the shareholders.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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