legal rep

What is the Company Legal Representative?

The Legal Representative acts as the “legal face” of the company and is the signatory for all company operational activities; in turn they have the legal responsibility to ensure the good operation and standing of the company.

In doing so the individual assumes certain personal legal liabilities and hence it is a position that is not taken lightly.  For example, if a company fails to pay all of its the relevant corporate taxes and/or fails to act in good faith then the local authorities may chose to take legal action, civil and/or criminal against both the company as well as the legal representative directly.

To be appointed as the legal representative the person must be a local national or a foreign national with the legal right to live and work in the country.  

While we encourage our clients to appoint someone within their business to fulfill this role, sometimes this isn’t possible due to the specified position requirements; as such Biz Latin Hub can offer this service by appointing a suitably experienced and trusted senior lawyer to act as a Legal Rep for the client.

Often clients will ask us to provide a legal representative during the timely process in which a foreign employee receives an appropriate visa and/or gained trust in a local employee who is going to take on this role.

A legal representative will help you with the different processes involved in opening a company.

Some Potential Problems?

The appointment of the legal representative is a very important decision for both the company and the individual, with serious implications if the wrong person is appointed as they are accorded the legal right by the shareholders to manage and to make decisions on behalf the company. 

When a legal representative is appointed or elected, the powers are typically given by a formally notarized document (nominally within the company bylaws). 

Nevertheless, we have encountered instances where the legal representative has acted without the prior approval of the shareholders and have completed actions such as to sell company assets, sign contracts without permission and/or to grant company resources to help friends and/or family.

Thus it is important that when selecting a legal representative that much consideration is given to confirming what powers are granted and ensure that the person selected is a trusted partner, employee, and/or contact of the companies owners.

As well as in El Salvador, we have legal representatives throughout Latin America.

A fundamental part of the incorporation process, and a reason for the importance of consulting legal experts in order to define the power and control handed to the legal representative.

It is crucial to ensure that the powers granted to the legal representative are adequate to allow them to complete their required professional functions, and on the other hand, are adequately restricted to ensure the risk is minimized. 

For example, a legal representative might need to obtain the owners signature prior to the sale of any company assets or they might need written authorisation to complete bank transfers in excess of USD$5,000 per day.

Biz Latin Hub has extensive experience with the company incorporation process; if you have any questions or concerns about the incorporation process and/or the role of the legal representative feel free to contact us.

Key services offered by Biz Latin Hub. Legal Representative

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.
Craig Dempsey
Craig Dempsey

Craig is a seasoned business professional in Latin America. He is the Managing Director and Co-Founder of the Biz Latin Hub Group that specializes in the provision market entry and back office services. Craig holds a degree in Mechanical Engineering, with honors and a Master's Degree in Project Management from the University of New South Wales. Craig is also an active board member on the Australian Colombian Business Council, and likewise also active with the Australian Latin American Business Council.

Craig is also a military veteran, having served in the Australian military on numerous overseas missions and also a former mining executive with experience in various overseas jurisdictions, including, Canada, Australia, Peru and Colombia.

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