Company incorporation in Argentina is becoming increasingly popular among foreign investors. The country boasts a large and diversified economy with a growing services sector, and a highly educated population with a well-established middle class.
Individuals looking for shorter-term engagement or limited-scale operations in Argentina should consider hiring staff through an employer of record. This allows you to hire local personnel without going through the processes of company formation and liquidation.
While Argentina has experienced some economic difficulties in recent years, the country has undergone significant growth since the famous debt crisis in the early 2000s, with the gross domestic product (GDP) (all figures USD) increasing more than four-fold between 2002 and 2021.
Like many countries, the economy took a beating during the pandemic years. But the recovery has been very strong, which is an optimistic sign for individuals wanting to register a business in Argentina. In 2019, Argentina had a GDP of $447 billion after a high of over $600 billion in 2017.
In 2017, Argentina was the third-largest economy in Latin America. GDP fell considerably during COVID, down to $385 billion in 2020. But it has since bounced back, reaching the 2019 level in 2021, which is an optimistic sign for the future!
Argentina’s gross national income (GNI) has more than tripled since the millennium. In 2021, Argentina registered a GNI of $10,630 — a figure that makes it an upper middle-income country by World Bank standards. Foreign direct investment has also been consistently high, totalling over $6 billion in 2021. This is another reason why company incorporation in Argentina is a shrewd business decision.
Argentina also has particularly high English proficiency levels. For first-time investors looking to incorporate a company in Argentina, this is a big help!
Argentina has a highly-developed professional services sector, including finance and consulting, which are major contributors to the economy. Additionally, the agricultural sector is a significant employer and contributor to the country’s exports, with soy and cereals being the main crops. Argentina is also a major producer and international distributor of beef and other meats.
This South American country is part of many free trade agreements. Perhaps most notably, the Southern Common Market (Mercosur), an initiative that includes Brazil, Paraguay, and Uruguay, and which recently celebrated its 30th anniversary.
Read on to learn more about company incorporation in Argentina, including how to choose the correct entity type and what the critical steps in the process are. Or go ahead and contact us now to discuss your business formation options.
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Company incorporation in Argentina: Which Entity to Choose?
When incorporating a company in Argentina, there are four main types of entities that foreign investors tend to choose from: the private limited liability company (LLC or PLLC); the public liability company (PLC); a partnership or a sole proprietorship. Each one carries its own advantages and drawbacks, and the best choice will depend on the needs of your business and its intended structure. Getting in contact with a company formation agent in Argentina is advised.
Investors particularly favor an LLC because they can own it entirely and establish it with no minimum capital. To establish an LLC in Argentina you need at least two shareholders and can have up to 50. Each shareholder’s liability is restricted to what they initially contributed to the company’s shareholding.
A PLC is an entity where shares are publicly traded on a stock exchange. To establish a PLC you must appoint at least two directors. The directors can be any individuals with the right to reside in Argentina, as long as there are no legal restrictions that prevent them from occupying said position.
A sole proprietorship, requires one investor and is straightforward to set up. However, liability remains unlimited. The investor will be responsible for all of the entity’s debts and obligations. A partnership is similar, but multiple partners set it up, and they share unlimited liability among themselves.
How to Incorporate a Company in Argentina in 9 Steps
Once you have chosen your entity type, follow these nine steps in order to complete company incorporation in Argentina:
Step 1: Appoint a Legal Representative
Appoint a legal representative via a power of attorney (POA). A legal representative can act on your behalf, including signing legal documents and overseeing the company formation process.
Step 2: Choose Your Company Name
Choose and register your company name with Argentina’s General Inspection of Justice (Inspección General de Justicia or IGJ). This process can be completed online once you have confirmed that there are no other companies trading under your desired name.
Step 3: Draft your Company Bylaws
Also known as a social contract, your company’s bylaws are the fundamentals of your firm. They highlight your company’s commercial intentions and structure. Once drafted, you must register the company bylaws with the relevant government authorities.
Step 4: Deposit Initial Share Capital in the National Bank
The government requires individuals forming a company in Argentina to make a temporary deposit of 25% of the initial capital to the Bank of the Argentine Nation. Once the company’s bylaws have been successfully registered, they are able to withdraw that money again.
Step 5: Make a Public Announcement of Your Company Incorporation in Argentina
Next, you must announce the creation of your company in a public announcement in the Official Gazette. The announcement must include the date you signed the constitution, the office you registered with, and the amount of social capital. It must be written by a registered lawyer in Argentina.
Step 6: Pay the Incorporation Fee
Once the above steps are completed, you must pay to submit documents to the Ministry of Justice and Human Rights website.
Step 7: Register the Company Books
Register the company’s accounting books (balance, journal, and inventory). You must also submit any other books with minute notes on meetings, and information of the board, deposit of shares, and record of actions.
Step 8: Obtain a Unique Tax Identification Code (CUIT)
To obtain this code, you need to present yourself in front of the Federal Public Revenue Administration (AFIP) with the required documentation, including proof of company registration before the Public Registry of Commerce.
Step 9: Complete Company Incorporation in Argentina by Opening a Bank Account
The last step to complete company incorporation in Argentina is to open a corporate bank account. You don’t need to be physically present in the country to do this. Your legal representative may recommend a specific account provider based on the nature and location of your business.
- Number of Partners: The S.A. can be formed by 2 or more partners, without any upper limit. Conversely, an S.R.L. must consist of a minimum of 2 partners and a maximum of 50.
- Liability Limitation: In both S.A. and S.R.L., partners’ liability is confined to the capital they have contributed. They are not personally accountable for the company’s debts.
- Incorporation: Establishing and registering an S.R.L. is more cost-effective as it involves fewer formalities compared to an S.A. An S.R.L. can be incorporated using a private document, whereas an S.A. necessitates a public deed.
- Duration Period: Starting from February 2022, the Inspección General de Justicia (IGJ), the local governing body, has decided to cap the lifespan of commercial companies at 30 years. However, this 30-year duration can be extended.
- Management of the Company: An S.A. is overseen by a board of directors, comprising one or more directors. On the other hand, an S.R.L. is managed by appointed managers.
Common FAQs When Forming a Company in Argentina
Based on our extensive experience these are the common questions and doubts of our clients on company formation in Argentina:
Argentina is good for business due to its abundant natural resources, skilled workforce, and strategic location.
It takes between 10 to 14 weeks to form a company in the Argentina after all required information and documentation has been provided.
Yes, foreigners can own a business in Argentina
The most common corporate structure in Argentina is the “Sociedad Anónima” (SA), which is similar to a joint-stock company.
It requires a minimum of two shareholders to form a company in Argentina.
Biz Latin Hub Can Help You With Company Incorporation in Argentina
At Biz Latin Hub, our team of multilingual company formation specialists has all of the tools necessary to help you incorporate a company in Argentina. With our full suite of back office solutions, including legal, accounting, and recruitment services, we can be your single point of contact to help you enter and operate in Argentina, or any of the other 17 countries around Latin America and the Caribbean where we operate.
Reach out to us now for personalized assistance or a free quote.
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The information provided here within should not be construed as formal guidance or advice. Please consult a professional for your specific situation. Information provided is for informative purposes only and may not capture all pertinent laws, standards, and best practices. The regulatory landscape is continually evolving; information mentioned may be outdated and/or could undergo changes. The interpretations presented are not official. Some sections are based on the interpretations or views of relevant authorities, but we cannot ensure that these perspectives will be supported in all professional settings.
