IGJ Regulatory Update: News for Foreign Companies
We are pleased to inform you that on July 16, 2024, the General Inspection of Justice (“IGJ”) has enacted General Resolution No. 15/2024. This new provision replaces the previous regulatory framework established by General Resolution No. 7/2015 and affects companies, civil associations, and foundations, both local and foreign.
Significant Changes in Regulation
General Resolution No. 15/2024 introduces significant changes to the regime applicable to foreign companies incorporated abroad that intend to carry out activities in the Autonomous City of Buenos Aires, either by registering branches, permanent establishments, or through the formation or participation in a local company. Below, we detail the most notable points:
- Elimination of Foreign Asset Requirements: It will no longer be necessary to prove the possession of assets abroad for the registration of branches, permanent establishments, or for foreign companies that wish to form or participate in a local company.
- Maintenance of Ultimate Beneficial Owner Obligation: The identification of the ultimate beneficial owners of foreign companies at the time of their registration is still required. In addition, branches or permanent establishments must annually report any changes in their ultimate beneficial owners when presenting their financial statements.
- Simplification for Vehicle Companies: The requirements for the registration of foreign companies that opt for the “vehicle company” figure are simplified.
- Clarification on the Unanimity of Shareholders’ Meetings: The failure to register a foreign company under the terms of article 123 of the General Companies Law 19.550 (“LGS”) will not affect the unanimous nature of the shareholders´ meeting.
- Elimination of Electronic Address Requirements: It will no longer be necessary to prove a special electronic address of the parent company for communications related to the legal representative.
- Suppression of the Annual Information Regime (RIA): The RIA is eliminated for foreign companies registered under the regime of article 118 paragraph 3 of the LGS and those mentioned in article 123 of the LGS.
- Elimination of the Registry of Isolated Acts: The obligation to report isolated acts derived from the creation of said registry is abolished.
- Cancellation of Registrations: Certain cases of cancellation of registrations as a sanction for non-compliance by foreign companies are eliminated.
- Exceptional Alternative for Documentation Certification: A solution is offered for cases where the notary of the jurisdiction of origin is not authorized to certify the powers of those who sign the company’s documentation.
Effectiveness and Early Application
General Resolution No. 15/2024 will be effective as of November 1, 2024. However, for procedures that are initiated or in progress before that date, the early application of the more favorable provisions of the new resolution may be requested.
We encourage you to review the full text of Annex I of General Resolution No. 15/2024, available at the provided link.
In the coming weeks, we will continue to share biweekly newsletters that will offer more details and guidance on other relevant aspects of General Resolution No. 15/2024.
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This message is of a general informative nature and should not be considered as legal advice. In case you need professional assistance, please contact our experts.