When Do You Need a Legal Representative in Argentina?

To establish a company and engage in business activities, it is mandatory to designate a Legal Representative in Argentina. They entity must be represented in the country, under law.

Argentina, as one of the largest economies in Latin America, operates within a complex bureaucratic framework when it comes to its business environment. However, the country’s significant size, skilled workforce, and strong regional connections present considerable opportunities for favorable investment returns, thereby offsetting the initial setup challenges. A legal representative in Argentina will be able to navigate this intricate business landscape and present your company with opportunities that comply with legal frameworks.

We explore company formation requirements in Argentina, and why a legal representative in Argentina, specifically, is essential to this process.

Why Argentina is a Good Location for Company Incorporation

 Argentina offers several advantages as a business destination. Firstly, it is one of the largest economies in Latin America, providing access to a sizeable consumer market and abundant business opportunities. The country’s strategic location and well-developed infrastructure facilitate regional and international trade. Hiring a legal representative in Argentina can help your company take advantage of the various business opportunities in the region.

Argentina boasts a highly educated and skilled workforce, offering a competitive advantage for businesses seeking qualified talent. The country has a rich pool of professionals in various sectors, including technology, finance, and creative industries.

Moreover, Argentina is known for its strong entrepreneurial culture and vibrant startup ecosystem. The government has implemented supportive policies and initiatives to promote innovation and entrepreneurship, attracting investors and fostering a dynamic business environment. But, in order to enter the market, it is required for your company to appoint a legal representative in Argentina. This may differ country-to-country, but is required in Argentina by law.

Additionally, Argentina has a diverse economy with thriving industries such as agriculture, manufacturing, energy, and services. This diversity provides opportunities for companies in various sectors to thrive and expand their operations.

Argentina offers great returns on investment, driven by its market size, skilled workforce, and regional interconnectedness. However, it is important for businesses to carefully navigate the legal and regulatory landscape and seek local expertise to ensure compliance and success in the Argentine market. A local legal representative can assist your company in remaining compliant and mitigating potentially legal issues.

Company incorporation: Appoint a Legal Representative in Argentina

The appointment of a Legal Representative in Argentina is necessary for two core process of company incorporation:

• Acting as administrator for the constitution of a company
• Registering a foreign company that intends to be a shareholder of a local (subsidiary) company in Argentina.

In the latter case, the legal representative will act as the person who represents the interests and carries out the will of a foreign company in the country, solely in its role as shareholder.

Article 123 of the General Companies Law (known in Spanish as the Ley General de Sociedades) outlines that any foreign company that intends to be a shareholder or shareholder of an Argentine company must register in the respective Public Registry of Commerce. To do so, they must designate a legal representative (among other requirements).

In this case, the responsibility assumed by the person appointed as the Legal Representative includes carrying out commercial activities of the foreign company in Argentina. They’re exposed to relatively low risk, because Article 123 essentially limits their activity to being a shareholder or shareholder of an Argentine company.

Companies in the region may appoint as many Legal Representatives in Argentina as necessary, but there must be at least one.

Who can be appointed as a Legal Representative in Argentina?

Any individual, local or foreigner, can be appointed as the company´s legal representative in Argentina, provided they:

• are over 18 years old
• have a Unique Tax Identification Code (Clave Única de Identificación Tributaria, or CUIT) in Argentina, and
• have a domicile in the country (that is, they physically live in the country).

A company or legal entity is not allowed to act as a legal representative in Argentina.

The designation of a company’s legal representation is formalized during the company registration process.

In the case of an existing company, the shareholders of that company can decide on the appointment or renewal of an existing representative or the removal thereof. This can be decided during the course of company shareholder meetings.

What powers does a Legal Representative in Argentina have?

The legal representative in Argentina represents the entity, and will act on its behalf to carry out all activities and procedures, make decisions, assume commitments, and formalize contracts that will be attributed to the company.

The legal representative may enter into and execute all acts and contracts included in the corporate purpose or that are directly or indirectly related to it.

In a Simplified Stock Company (SAS), the legal representative may be in charge of one or more human persons, partners or not, as designated in the company’s constitution and contract with the representative. If not specifically stated, this designation will correspond to the meeting of partners or, where appropriate, to the sole company member.

The legal representatives´ powers are defined in the contract between themselves and the company, and can be modified according to the business owner’s desires. The company can limit the extent of their responsibilities as needed.

Alternate Administrator roles and responsibilities

While companies can appoint a single legal representative in Argentina or a “Regular Administrator,” it is also necessary to designate an ´Alternative Administrator´. This measure is in place to anticipate situations where the incumbent representative may encounter an incident that prevents them from carrying out their functions. The presence of an Alternative Representative mitigates risks for the company by ensuring the ability to conduct all legal activities, even if the main legal representative in Argentina is unable to do so.

Although the doctrine acknowledges this aspect, it is understood that the responsibilities associated with the position of the Alternate Administrator will not be immediate or constant. They will assume the relevant responsibilities for the company when they effectively and actively take on this role.

Find your legal representative in Argentina at Biz Latin Hub

As one of the largest economies in Latin America, Argentina offers many commercial opportunities for foreign investors interested in gaining a foothold in the region. Though the country houses one of the more complex bureaucratic systems in the region, working with trusted local legal experts ensures entrepreneurs are correctly guided through company formation steps and can start their operations.

The Biz Latin Hub group has extensive experience in the company formation processes and finding a quality, legal representative in Argentina. Our Argentina team of professionals offer a customizable suite of market entry and back-office services, providing an integrated approach to your expansion into Argentina.

For more information about how we can best represent your business in Argentina, or for personalized support, contact us today here at Biz Latin Hub.

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