How to Form a Company in Argentina and Get Permanent Residency
Argentina has had its fair share of up and downs politically and economically. Once a global power, the country suffered through the great depression, successive governments favoring protectionism, high levels of corruption, the worlds highest sovereign debt default and the 2007 GFC. These factors, amongst others, created instability in the economy, high levels of inflation and high rates of unemployment. Somehow, the former global leader has weathered these issues over the years – there is no denying that. There are still signs of the troubled past lingering around in the form of high inflation and lack of investor confidence. However, as the country continues to rebuild, signs of the old Argentina are beginning to show, bringing in a new wave of international investment in Argentina.
Why Argentina? Business Opportunities Available for Investors
Argentina presents business opportunities for investors in a range of industries. As the new government opens up the economy to foreign participation, these opportunities become more accessible. Below are just a few of the attractive investment sectors available:
- Agriculture: Whether it be soy, meat or wine, the varied landscape of Argentina means that agriculture is and will continue to be a dominant industry in the growth and development of the country. Due to years of under-investment, the sector is in need of investment.
- Oil and Gas: There is great potential in the oil and gas industry in Argentina. According to the EIA, Argentina ranks third among countries holding unconventional natural gas reserves and fourth among those that have stocks of shale oil.
- Exportation: The government has nearly tripled a number of import licenses available and in 2018 there will be dramatic reductions in soybean export taxes (Argentina is the largest exporter of soybean oil and soybean meal).
- Renewable Energy: A combination of ideal climatic conditions to produce renewable energy and government support for investment in the industry create a wealth of opportunities for international investors.
As can be seen from the above, Argentina has a lot to offer investors. Once investors have the legal right to do business in Argentina, there is a range of untapped markets for the picking. Through a company formation and access to a visa, the true potential of Argentina can be tapped into.
The Formation of an Argentinian Company
As the economy opens up, the processes required to do business in Argentina become easier. This is true for the formation of Argentinian companies by foreigners. In saying this, due to successive governments essentially denying keen investors the opportunity to invest in the region, the processes and procedures to form an Argentina company can be more complex and timely than in other countries in the region such as Mexico and Colombia.
As a way to simplifying the company formation process, and therefore making an investment in the country a more viable option, a new type of company has been formed – The Argentine Simplified Shares Company (S.A.S Sociedad de Acciones Simplificada). The new S.A.S allows company formations to be approved within 24 hours; this includes obtaining the Company Identification Number (CUIT – Clave Única de Identificación Tributaria) and getting permission to open a corporate bank account.
In addition to the S.A.S, foreigners have two (2) other options (there are more, however, they are not commendable considering their complexity and processing time) to choose from when considering a company formation in Argentina. See below these options:
- Argentine Corporation (S.A Sociedad Anónima)
- Argentine Limited Liability Company (S.R.L Sociedad de Responsabilidad Limitada)
For information regarding the requirements, advantages, and disadvantages of each of these types of Argentinian companies, please see this link
In order to ensure the process is completed correctly and in a timely fashion, it is recommended to use the services of the professional local company to complete the company formation process. A local company who operate in English can prove to be a great set-up strategy. Another advantage of a company formation in Argentina is that is can be done remotely, without the procedural need to enter Argentina.
How to get Permanent Residency in Argentina
Once you have formed an Argentinian company, you have a few visa options regarding being able to travel to Argentina for business purposes. Please see below two (2) visa options for foreigners:
- Argentinian Working Visa
Foreign individuals looking for a residency, an Argentinian working visa will be required. To begin the process, the company must be registered in the ‘Registro Nacional Unico de Requirentes de Extranjeros’ (RENURE) in order to be able to hire foreigners. Once this process is complete, the company must provide information regarding their intent to hire a foreigner in addition to corporate documentation. An Argentinian company (that is registered in the RENURE), can be used as a vehicle to hire foreigners. Essentially, the Board of Directors can use the company to hire employees, which could include themselves. It should be noted that a working visa can be gained without a contract with an Argentinian company, however, the chances of this visa being granted are significantly reduced. The visa processing takes between 8-12 weeks, and the visa is valid for 1 year, however, it can be renewed.
Individuals who are nationals of the countries that make up MERCOSUR can apply initially for a two-year temporary residency visa. This type of residency requires less documentation than for individuals who are not nationals of the countries in MERCOSUR.
Individuals who have permission to work in Argentina can be granted permanent residency in Argentina after having lived and worked in the country for an extended period of time.
- Temporary Argentinian Investors Visa
This type of visa was introduced to assist foreigners who intend on investing a minimum of AR$1,500,000 (Approximately USD$85,000) in an Argentinian activity, trade, good or service.
The process will begin with the individual presenting their business plan outlining their business objectives to the Argentinian Consular Office; specifically where and how they intend to invest the capital. These funds must be justified through the Central Bank of the Republic of Argentina. In addition, all documentation must be submitted in Spanish to the Migration Office. The entire process can take between 12-16 weeks.
If all documentation presented is approved, and all of the requirements fulfilled, then the applicant will have to schedule an appointment in Argentina. At this appointment, all previous documentation will have to be presented along with the approved consulate application, original/copies of passport, police records, passport style photos etc. The application for the temporary investor’s visa can be approved or denied on the same day as your appointment.
Time to Set-Up Your Argentinian Business and Get Permanent Residency
As the economy opens up, the investment options grow dramatically. While there are still barriers regarding international investment in Argentina, times are changing and the policies and procedures are shifting to benefit both Argentinian nations and investors. Whatever your view on globalization, it is undeniable that it greatly benefits developing nations, one being Argentina. The inflow of capital and knowledge is great for Argentina, and while contributing the economic growth of Argentina (GDP, inflation, unemployment levels etc), investors can themselves benefit greatly. Now is a great time to invest in Argentina.
Set up your business, get residency and take advantage of not only the business opportunities available but all the joys of living in Argentina.
Source: Biz Latin Hub