On September the 2nd of 2016, the executive power filed an initiative for the creation of a new company type, the Simplified Joint Stock Companies (S.A.S., in Spanish), in the context of the creation of a new legal regime to promote the entrepreneurial activity, including the implementation of a Collective Funding System (CrowdFunding).

At last, the project was enacted by the National Congress and was adopted as the Entrepreneurs Law Nº 27.349, published with the Republic of Argentina Official Gazette on April the 12th of 2017.

This law proposes to create a new company type, the S.A.S which will be regulated by the aforementioned new law; and supplementary, by applying the General Companies Law N° 19,550 (GCL).

Within the City of Buenos Aires jurisdiction, the Public Registry of Commerce, has set its own procedures throughout   General Resolution Nº 6/2017, which will come into force on September 1st, 2017.

The main aspects of this new Company Type: in summary, are the following: it can be constituted by one or more individuals or legal entities, incorporated through private or public instruments with digital signature, a company´s corporate purpose with plural non connected activities is permitted,  minimum incorporation capital stock equivalent to two times the mobile and vital minimum wage (approximately AR$16.000), shareholders contributions can be deducted from the income tax, shareholders liability is limited to the integration of their shares, although all of them will jointly and unlimitedly guarantee their paid- in contributions, limitations to the transfer of shares within a maximum of 10 years, renewable if approved by the total of the capital stock, directors’ unlimited term of office, digital  bookkeeping, shareholders meetings via videoconference or  digital means are allowed and shareholders can cast their votes through a consultation system.  As to share capital increases, the law establishes an information regime to be filed digitally to the competent registration office and allows the increases that are not over 50% of the share capital not to be registered. Also, it includes the possibility of maintaining irrevocable contributions for a 2 year term, and the issuing of different share premiums. SAS will not have to file their financial statements – even for companies with more than AR$ 10.000.000 of capital stock – . Also mandatory insurance policy for directors for their performance is not required. The SAS can be constituted digitally and the PRCs can create a standard by-law to accelerate the registration process. Within 24 hours after the registration request, the PRC must grant the registration to the requesting company. The Federal Public Income Administration (AFIP) must assign a CUIT (Tax ID) within 24 hours after the filling of their online form, without presenting any additional documentation.  

The SAS cannot be subject to the surveillance state control regulated under Section 299 of the GCL, unless such surveillance becomes mandatory because their share capital raises to more than $10.000.000. The SAS can not be controlled by companies regulated under Section 299 of the GCL and neither can be related by their participation in more than 30% of the share capital of a company included in such article.  Regarding the inspection, it is optional for the SAS whether to have a private inspection or not. Should they chose not, there shall be appointed at least one alternate Board member.

The new company type purpose is focused on to the needs of the entrepreneur capital, but the law does not prohibit its use for other types of projects, however, the requirements established under this new law must be applied.