New alternative for payment of contributions

The Public Registry of Commerce (“PRC”) issued General Resolution No 18/2004, published in the Official Gazette on September 7, 2004 and General Resolution No 21/2004, published in the Official Gazette on September 10, 2004 (herinafter the “Resolution”).These resolutions provide a new alternative to evidence contributions at the moment of incorporating local corporations (“sociedad anónima”), limited liability partnerships, civil associations and non-profit organizations.

The Resolution came into force on the day of its publication in the Official Gazette, that is, on September 7, 2004.

1. Corporations and limited liability partnerships

Sections 149 and 187 of the Companies Law (“CL”) set forth that payment of contributions (at least 25% of the total subscribed corporate capital) must be evidenced at the moment of registration of the company’s incorporation, by submitting proof of a deposit in an official bank.

The Resolution incorporates the possibility of evidencing such payment in the following manner:

a) In the case of incorporation of the company through public deed:

i) the public notary who intervenes must expressly state that the partners incorporating the company deliver before him/her the corresponding funds to the administrators who are appointed in such act, and that the latter accept such funds; or,

ii) the public notary may also state that the funds are delivered directly to him/her, with the charge of delivering the funds to the administrators once the company is duly incorporated.

b) In the case of incorporation through private documents: the payment may be evidenced through a notarial deed stating the occurrence of any of the above mentioned requirements.

2. Civil associations and non-profit organizations

Similarly to the above, these organizations may evidence due payment of the required initial capital through the manifestations of a public notary through a public or notarial deed.

Civil associations whose initial capital is A$ 200 are exempted from the requirement of submitting a separate notarial manifestation, in which case proof of delivery to the Executive Commission appointed in the articles of incorporation will suffice.