Cancellation of companies’ registration with the Public Registry of Commerce

To simplify the process of cancellation of registered companies that have not carried out any activity, the Public Registry of Commerce (herein “PRC”) has issued Resolution No 05/2004 (herein the “Resolution”), published in the Official Gazette on April 30, 2004. The Resolution regulates the proceedings for the cancellation of the company’s registration without having to follow the proceedings of dissolution and liquidation set forth in the Companies Law No 19,550.

The Resolution became effective on May 1, 2004.

1. Conditions for its application

The proceedings set forth in the Resolution may only be used by registered companies who request cancellation of their registration within the term of two years as of the date of registration before the PRC, and as long as they comply with the following negative conditions:

a) the company has not: (i) filed any registration proceedings after its initial registration with the PRC, (ii) filed its financial statements, (iii) requested the registration of its accounting and corporate books, and (iv) paid the annual fees in the case of corporations;

b) the company has not made any filing or registration required by the applicable tax and/or social security regulations;

c) the company has not invoked its by-laws vis-à-vis third parties.

2. Requisites of the request for cancellation

In addition to complying with certain formal requisites, the Resolution requires the following:

a) The shareholders, administrators and statutory supervisors of the company must provide a sworn statement declaring that:

i. the company complies with, and has complied with since the date of its incorporation, the conditions described in the above section;

ii. the company has not carried out any transaction that may result in the creation of rights or obligations;

iii. neither the company nor its corporate bodies have had any administrative activity

b) The express assumption of unlimited joint and several liability by the partners, administrators and statutory supervisors, when applicable, for the obligations that may have been undertaken by any of them, even if in breach of the dispositions relating to management and representation set forth in the law or bylaws. In addition, the partners must expressly waive the right to invoke the liability regime and the “right of excussio” (beneficio de excusión) that could otherwise be applicable.

c) Publication of such event in the Official Gazette for one day.

Once such conditions and requisites are complied with, along with the formal requisites and payment of annual fees, the PRC will take marginal note of the cancellation of the registration in the corresponding official record and in the public deed of incorporation of the company.