Towards a Reconstruction of the Public Registry of Commerce
The Public Registry of Commerce has issued a series of General Resolutions to review the current regulations, identify problems, and solve them, seeking to promote private initiative.
Since the appointment of the new General Inspector, Dr. Daniel Vitolo, the Public Registry of Commerce in the City of Buenos Aires (IGJ), has begun a review process of the whole regulatory framework to identify the issues that these regulations cause.
Seeking to promote private initiative and to boost the activity of private legal entities, during the last quarter, the IGJ has issued different General Resolutions. These Resolutions repeal and amend certain regulations the previous administration had issued, which implied an overreach of the IGJ powers.
The most relevant amendments are listed below. We also include links to articles our experts wrote describing the main aspects of each resolution:
- General Resolution 1/2024, reestablishing the 99-year deadline for commercial companies, following customary uses and practices.
https://www.marval.com/publicacion/la-igj-modifico-importantes-disposiciones-sobre-sociedades-15749
- General Resolution 2/2024, eliminating rules requiring a single corporate purpose and the adequacy of the corporate capital to the company's corporate purpose.
https://www.marval.com/publicacion/la-igj-modifico-importantes-disposiciones-sobre-sociedades-15749
- General Resolution 3/2024, allowing the transcription of only the relevant parts of the instruments subject to registration before the IGJ and establishing new minimum formal requirements.
https://www.marval.com/publicacion/la-igj-modifico-importantes-disposiciones-sobre-sociedades-15749
- General Resolution 4/2024, granting greater autonomy to existing country clubs and real estate associations regarding their governing boards, their owners, and their organization and operation.
- General Resolution 5/2024, removing the obligation of representatives of foreign companies registered under article 123 of Law 19550 to provide a guarantee.
- General Resolution 6/2024, suspending the digital filing of financial statements for companies not included in article 299 of Law 19550.
- General Resolution 7/2024, amending the regulatory framework for simplified joint stock corporations (SAS).
The General Resolutions issued during the last month modify the following matters:
- Applicable regime to the powers of attorney granted to SAS administrators
Article 1 of the General Resolution IGJ 20/2020 amended article 38 of General Resolution IGJ 6/2017, which stated that, to be registered, SAS had to submit the powers of attorney granted to any representative of the administrator domiciled abroad. This Resolution also determined that these powers of attorney could only be granted in favor of the members of the Board of Directors residing in Argentina. Finally, the IGJ vested itself with the power to deny the registration of broad powers of attorney for the administration and disposition of corporate assets.
Through General Resolution 8/24, the IGJ repealed General Resolution IGJ 20/2020, reestablishing the wording of article 38 of General Resolution IGJ 6/2017 as follows: "Article 38.- the power of attorney granted to the representative of the administrator domiciled abroad shall not be registered and shall be limited to the reception of notifications on behalf of its represented party and, if deemed necessary by the administrator, to the performance of proceedings on its behalf before the Public Entities."
Among others, General Resolution 8/24 highlights as grounds for repealing Resolution IGJ 20/2020 that it implied a triple overreach in the regulatory powers Law 22,315 vested the IGJ with in its article 11, subsection c) by granting itself broader supervisory powers; the lack of legal support; and the fact that it was contrary to the principle of freedom of the parties.
- Update in the fees for forms
On February 29, 2024, the Ministry of Justice issued the Resolution MJ 33/2024, increasing the value of the IGJ module to ARS 1,500 and delegating to the IGJ the determination of the date in which such change would become effective. Through General Resolution 9/24, the IGJ determined April 8, 2024, as the date as from which the new values will apply. Forms paid before such date must be adjusted to the new module value.
- New regulation applicable to foreign companies
General Resolution IGJ 10/2024 was published on March 27, 2024, repealing General Resolution IGJ 8/2021 and its Annex A, and making more flexible the legal regime applicable to foreign companies registered in the City of Buenos Aires. In the following link we include an article our experts wrote, summarizing the main amendments General Resolution IGJ 10/2024 introduced: https://www.marval.com/publicacion/nueva-regulacion-de-la-igj-aplicable-a-las-sociedades-extranjeras-15806
It seems there is a paradigmatic change in how the IGJ perceives its role in the flow of commerce. Changes are gradually being made to controversial regulations the former administration introduced, such as those related to foreign companies. Further changes to the current regime—aimed at simplifying the proceedings and deregulating the excessive regulations the IGJ issued— are expected.
It is advisable to remain alert and constantly monitor changes to understand the impact that new resolutions may have on local and foreign companies already registered, as well as on the structuring of new businesses.
We invite you to contact us for further advice on these and many other corporate issues.
This insight is a brief comment on legal news in Argentina; it does not purport to be an exhaustive analysis or to provide legal advice.