Seminar Organized by the Superintendence of Corporations

The seminar was conducted on November 4, 10, 18 and 25, 2014, at the Conference Hall of the Ministry of Justice and Human Rights.

The seminar was conducted by a team of IGJ inspectors that presented the subject to be dealt with on the corresponding date, and requirements established by the rules in force for said subject. On each date, the team of inspectors answered the queries formulated by the audience.

Below, we will proceed to list some of the main legal matters clarified by the inspectors.

Business Organizations

Business purpose, which must be precise, defined and unique: the IGJ admits, for certain cases –duly justified within the framework of corporate operations– including some activities that, prima facie, may not comply with the unique business purpose requirement.

Legal representative of a foreign shareholder: the IGJ allows a director of a local company to be also appointed as legal representative of its foreign shareholders; therefore, it does not consider said action as an infringement to section 239 of the Companies Law No. 19,550 (LSC, for its acronym in Spanish).

Affidavit for the updating of data pursuant to IGJ General Resolution No. 1/10 (Res. 1/10): the IGJ’s computer system warns of the failure to have complied with the filing of the affidavit required by Res. 1/10 as well as the matters indicated therein yet pending. Accordingly failure to comply with said filings may obstruct the registration of further resolutions until all requirements are fulfilled.

Independent professional: the inspectors reminded the audience that, pursuant to the rules in force, the person issuing the legal report to be filed before the IGJ must be an independent professional. Thus, a director, statutory auditor or employee of the company requiring registration of the company resolutions before the IGJ, or the shareholder’s legal representative, may not execute the legal report.

Foreign Companies

Authentication of legal standing and capacity of foreign signatory: if the home country does not authenticate –pursuant to its legislation and/or customs and practice– the legal standing and capacity of the person executing documents abroad, a certification of the registry or authority of said jurisdiction proving evidence of same may be filed with the IGJ.

Certificate of validity: certificates no older than 6 months are admitted. Said certificate shall indicate whether the foreign company is –or is not– currently undergoing a liquidation proceedings or a legal process imposing a restriction on its assets or activities. If the certificates issued by a specific country make no reference whatsoever to the aforementioned matters, a legal opinion issued by a lawyer registered with the bar association of said country may also be submitted.

Registration of expiration of legal representative appointment: The IGJ does not register the termination of the legal representative appointment due to expiration of the term.

Branch registration (section 118 of the LSC) based on the original registration of the foreign company in order to participate as shareholder in local companies (section 123 of the LSC) and vice versa: it is possible to perform the registration of a foreign company pursuant to section 123 of the LSC, that is to say to hold participation in local companies, based on its original registration in the country as a branch (under section 118 of the LSC), by filing the supplementary documentation required to such end. Moreover, it is feasible to turn the original registration of a branch into that of a foreign company, solely to hold participation in local companies.

Supervision by the IGJ

Publications of calls to shareholders’ meetings in the Official Gazette: the IGJ checks the Official Gazette on a daily basis so as to detect companies calling to meetings. Currently, the IGJ attends every meeting held by companies subject to the State permanent control (section 299 of the LSC).

Filings to be performed prior to the shareholders’ meetings: the IGJ is urged to supervise the financial statements and related documentation that shall be submitted prior to the annual shareholders’ meetings held by companies subject to permanent State control. Failure to comply with said filing or failure to file the documentation on the stipulated date shall carry the fines imposed by the IGJ.

Call to shareholder meeting by the IGJ’s: the IGJ only intervenes on calls for shareholders meetings of corporations (“sociedades anónimas”). It does not intervene in the call for other types of commercial companies.