The most important types of
companies in Uruguay are:
. Corporation (Sociedad Anónima)
Office of Foreign Company
. Off Shore Corporation (Holdings)
Limited Liability Company (Sociedad de Responsabilidad Limitada)
There are special regulations for banks and
Corporation (with capital stock)
This type of
company is characterized by the existence of a minimum capital divided
into transferable shares.
The capital stock must be represented by
shares with face value expressed in national currency.
Shares may be
bearer or registered (endorsable or not), and holders may be
national or foreign individuals or juridical persons.
Shares may be
common or preferred.
A corporation may be either a Public or Private
Public Corporation (Sociedad Anónima abierta)
Those that quote their shares on the stock exchange, or those that
invite the public to subscribe for their shares or debentures are said to
All companies not registered as public corporations are
regarded as private corporations.
Prívate Corporation (Sociedad Anónima
Incorporation. At least two founding members are
required to establish a Corporation.
Capital. The amount of the
authorized capital is fixed by the founder in compliance with the legal
The capital may be paid in cash or in kind.
stock must be represented by shares with face value expressed in national
Shares may be bearer or registered (endorsable or not), and
holders may be national or foreign individuals or juridical persons.
Shares may be common or preferred.
Despite the fact that a minimum
of two persons are required for founding a corporation the total block of
stock may be held by a single shareholder.
For certain activities only
registered shares are permitted (television, broadcasting, banking
Management The corporation bodies are the Board of
Directors and the Meeting of Shareholders.
The corporation is directed
and administrated by a Board of Directors which is appointed by the
Meeting of Shareholders.
There are no legal requirements as to the
number of members of the Board of Directors.
Board members may be
national or foreign individuals or juridical persons, be they Shareholders
or not, domiciled in the country or abroad.
Board members may act on
their own behalf or through agents and the granting of powers of attorney
is not subject to formalities.
Board members are elected for a specific
term and can be re-elected indefinitely.
Legal representation of the
corporation rests with the chairman of the Board, unless otherwise
established in the bylaws.
The Meeting of the Shareholders is the
maximum body of a corporation and can meet in regular and special
The Ordinary Meeting of Shareholders takes up the company's
Balance Sheet, the distribution of earnings and the appointment of the
Board of Directors.
Extraordinary meetings of Shareholders must
necessarily resolve, without the possibility of the bylaws establishing
otherwise all questions related to amendment of the bylaws, increase or
decrease in capital, reimbursement of capital, merger, transformation or
dissolution of the company, redemption, reimbursement and amortization of
shares and other relevant issues.
A system of protection for minority
shareholders determines a series of basic rights, such as the right to
dividends, the right to preference in increase of capital, the right to
vote, the right to information, the right to recess, the right to
verification and the right to call Shareholders meetings with a certain
percentage of support (20%).
Organization Within six months from
the end of each financial year, a Shareholders meeting must be called to
approve the annual financial statements. There the statutory auditors, if
any, present their annual report to the Shareholders.
Ownership of a
simple majority (50% + 1 vote) of the voting rights gives effective
control of the company.
Branch office of foreign company
Law No. 16.060, companies duly established abroad are recognized in
Uruguay as a matter of law. Such companies are governed, as regards
existence, status, operation and dissolution, by the laws of their place
of constitution, insofar as they do not violate international public
policy in Uruguay.
Foreign companies intending to undertake activities
in Uruguay on a regular basis must establish a branch in the country.
For such purposes they must file their incorporation papers with the
Public Registry of Commerce, along with a resolution by the home office
establishing the opening of the branch, its domicile, the appointment of
an agent, and the allocation of capital in an amount not less than the
minimum required for domestic corporations.
All documents are to be
Subsequently, the incorporation papers are to be
Off Shore Corporation (Holdings)
Anónima Financiera de Inversion (SAFI) is a form of Holding Company which
constitutes a special category within the Uruguayan Corporations. It has
as its purposes commercial and financial activities of an off shore nature
within a very favorable Tax System. A Corporation is considered to have
Off Shore activities when the Company develops all its economic activities
outside Uruguay, nevertheless, it can be managed and domiciled in
The purpose of this kind of Company is very broad and must be
oriented towards economic activities outside Uruguay.
As an example
these Companies can:
. maintain all types of bank account in any
currency (even within banks in Uruguay)
. own any type of shares,
bonds, securities, certificates, debentures and bills not issued by
Uruguayan companies, except treasury bonds.
. own precious metals.
own real property.
. undertake any other commercial or industrial
activity permitted in the country in question.
Holding Companies are established by a procedure similar to that of
Free zones Companies.
These corporations have
as their object, to develop activities of direct or indirect users of free
zones established in the country, taking advantage of the fiscal
exemptions of those areas. The incorporation procedure of free zone
corporations is simpler than the established procedures for regular
The minimum capital for such corporation is approximately U$S
23.000.-, 50% of the capital must be subscribed and 30% paid-in cash or in
kind. They must be founded by three natural or juridical persons and the
incorporation papers are filed directly with the Public Registry of
Such corporations are not subject to any restrictions as to
their share holders who may be natural or foreign individuals or juridical
Free Zone users are exempted of all taxes except for the ones
referred to social security contributions.
As regards all other matters
they are governed by the regulations for normal