Having passed already 3 years since the Law’s entry into force, we seek to present some of the shortfalls and disadvantages detected in our practice, that are generated by the use of the mentioned Registry.
A setback that occurs in certain proceedings, like in the statute reforms of a joint-stock company, where the system requires the upload of the act or instrument by which the reform was agreed, with the notary having to authorize with his signature the document, just like the signature of the partners in order to proceed with the reform before the registry.
Some notaries, when they have to face such situation, opt not to authorize documents granted before another notary, indicating that they don’t have the legal faculty of endorsing what another notary has undertaken. Although this argument makes little sense, many company modifications had to turn to several notaries in order to solve the problem.
In addition to the mentioned issues, which may qualify as the notaries’ denial of service, there are shortfalls intrinsic to the portal “companies in 1 day”.
On the whole, the platform usually presents general instability, constantly delivering error messages or “try again later”, other times it does not record the information entered in the form or it just shuts down unexpectedly.
More specific matters, like the calculation of the partners’ participation percentage are not properly solved in the platform, having to often adapt the partners’ participations in order to fit them in the platform or iterate several times with the number of actions until reaching a result that the system may finally process.
Then when it’s time to process the companies’ transformations, there are several functions that are disabled depending on what you’re trying to transform. For example, in the case of the transformation from an E.I.R.L. to a SpA it is not possible to incorporate new partners in the transformation act, nor modify the company’s capital or its core operations. Such issues are not justified on legal grounds, but are simply the platform’s limitations.
With regards to the administration of the SpA, where the law does not set limitations, the registry does, offering restricted options concerning the forms of administration.
I believe this system will keep improving, both as to the performance of the software as to the flexibility and ease in using the forms, evolving until it becomes the best option to create and modify societies, given that today the only merit it has is of being the cheapest.
Santiago Henríquez C, Lawyer.
Translation: Giorgia Vulcano
Picture: Patrick Tomasso (CC0)