Since the change of Government in Argentina and the appointment of the new inspector in charge of the Inspection General of Justice (the “IGJ”), Daniel Roque Vítolo, some of the most severe and interventionist corporate regulations issued under the previous Directorate are gradually beginning to be revoked.

In short, it is now possible to incorporate companies in the IGJ that: i) have a term of up to 99 years; ii) have multiple corporate purposes, as long as each legal act is described in a precise and determined manner, even if the different acts are not related; and iii) meet the capital stock established by Section 186 of Law 19.550, without the IGJ being able to require a higher capital stock.

The recently issued resolutions evidence the intention to restore the legal and reasonable limits to the regulatory powers of the IGJ.

The first resolution issued this year (1/2024) repeals General Resolution IGJ No. 1/2022, which established that companies could be incorporated for a maximum term of 30 years, thus enabling again the possibility of incorporating companies for a term of up to 99 years. General Resolution IGJ 1/2024 clearly states in its grounds that “Law No. 19.550 only requires that the articles of incorporation of the company contain in a determined manner the term of duration … without specifying minimum or maximum terms” and that “… the legal provision in force -Law No. 19,550- has not imposed any limitation in this respect, nor has it delegated any authority or public organization to establish a maximum term of this nature”.

Following the policy that the regulation issued by the IGJ should not exceed its regulatory functions by arrogating to itself legislative functions that have not been delegated, Resolution 2/2024 establishes that the corporate purpose of a company incorporated before the IGJ “may be formed by a set of categories of legal acts and shall be indicated in a precise and determined manner. It shall not be required that such categories of legal acts be related or related to each other”.

This resolution is also based on the right to freedom of enterprise and Article 14 of the National Constitution.

Likewise, General Resolution 2/2024 repeals the possibility that the IGJ may, at its discretion, require changes in the first capital stock amount to that set by the company in the articles of incorporation, provided that the minimum capital amount set by Section 186, first paragraph, of Law No. 19,550 (t.o. 1984) is complied with.

Finally, Resolution 3/2024 establishes that the registration of procedures in the registry that involve the submission of minutes or corporate resolutions contained in operating books will no longer be conditioned to the obligation to submit a full copy of such corporate decisions, but that certain relevant parts must be transcribed, complying with the minimum contents required by the new last paragraph of Article 37 of General Resolution IGJ No. 7/2015. In the grounds of this resolution, the IGJ states that “… imposing registrations before this body and in the Public Registry under its charge not established by law, referring to proofs, instruments, records or documents, under the mere requirement of a formal publicity, appears as an excess in regulatory matters not enabled by Law No. 19.550 (t.o. 1984) and its amendments, nor by the Civil and Commercial Code of the Nation that does not admit the access of third parties to such information but under certain circumstances”.

 

By virtue of these amendments, a change in the IGJ’s policy is observed with the purpose of reducing regulatory excesses and restoring certain autonomy to the companies within the limits allowed by law and which make for a better functioning within the commercial and legal system.

 

Consultations related to corporate matters: mcbrazzola@lermanszlak.com

Phone: +54.11.4786.4273

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