Uruguay company registration services – Incorporation of a SAFI

Localization and weather

Uruguay is in South America with coasts on the Atlantic Ocean, between Brazil and Argentina. It has a land surface area of 176,215 km2 and a total area of 318,413 km2 when considering rivers and territorial waters.

The country is divided geographically into 19 states ("departments") with Montevideo as its capital. The largest cities are Montevideo, Salto and Paysandú, last both on the shore of Rio Uruguay, the river that is the border line with Argentina.

It is the only South American country that lies entirely in a temperate zone. Due to this, it has small variations in temperature, precipitation and other climatic factors.

There are no remarkable topographic features. Most of the country consists of gently undulating plains crossed by long rivers. The climate is mild and healthy throughout the year. Temperatures average 62° to 82°F (17° to 28°C) in summer and 42° to 57°F (6° to 14°C) in winter. Rainfall occurs in all seasons but is generally heavier in the autumn months.

Its weather and topographic is especially suitable for agriculture, forest and livestock production.

Population and language

According to the last census (2011), the population of Uruguay is a bit more than 3.2 million.

Approximately 95% of the whole population lives in urban areas – about 60% live in Montevideo and its surrounding areas.

There is no indigenous population; most Uruguayans are descent from Europeans (mainly Spanish and Italian).

Spanish is the official and most used language.

English is the most used foreign language by the business community. Currently, Portuguese is also widespread as a result of having a long border with Brazil and because of the trade and tourism between both countries.

Political system and government

Uruguay has long standing traditions of democracy and legal and social stability and a solid financial and legal framework that is attractive to foreign investors contemplating business ventures in the region.

Politically, Uruguay has a democratic republic system, with a presidential regime and three consolidated political parties. The government is divided into three independent branches: Executive, Legislative and Judicial.

The Executive Branch is administered by the President of the Republic, who acts together with the Vice President and the Ministerial Council. The President and the Vice President are elected through universal, popular, direct vote and the Ministers are designated by the President.

The Legislative Branch consists of the General Assembly, which includes the Vice President, a 30-member Chamber of Senators and a 99-member Chamber of Representatives. Parliamentary elections are held at the same time as presidential elections (last Sunday of October every five years – last election was held on 2009).

Uruguay has a two-round system for Presidential elections. In case the candidate for President with more votes in the election of last Sunday of October does not reach the 50% plus one of the valid votes, then there is a runoff with the second most voted candidate, on the last Sunday of November of the same year.

The President, Vice President, Senators and Representatives serve a five-year term. The Vice President, the Senators and the Representatives can be consecutively re-elected, but the President cannot.

The Judicial System is administered by the Judicial Power, one of the three State Powers. Its jurisdiction is national. It is divided in Courts and Tribunals. The system adopted for the judiciary is the collegiate one for higher organisms (Supreme Court of Justice – the highest hierarchy Justice Body and Appeal Tribunals) and the one-man system for the lower organisms (Courts and Peace Courts).

State governments are elected in a separate election from the Presidential and each state chooses its own public authorities. Each state has an "Intendent" (Governor) and a Legislative Branch of 30 members, where the majority (at minimum) belongs to the party of the Governor that has won the state election.

The Uruguayan economy is solid

Although Uruguay’s economy is strongly rooted in raw material production (meat, grains, wool, wood, cellulose pulp), other strategic sectors have developed as a result of high human capital standards. These sectors, including services related to tourism, information technology, finance, logistics and transportation, construction, call centers, and shared service centers among others, have shown significant growth over the last few years.

Most companies are small and closely held by controlling families, but state owned companies and multinationals are an indispensable part of the Uruguayan economy.

In the beginning of the XXIst century, Uruguay is going through one of the highest growth periods in its history, sustained by a favorable context of prices for seeds and meat and the implementation of stable macro-economic policies.

In 2013, Foreign Direct Investment (FDI) reached USD 2.8 billion (about 5.0% of GDP), representing a record in absolute values. Between 2006 and 2012, FDI has more than duplicated and is expected to continue its growth since new investments are currently underway.

Uruguay is one of the top three countries in attracting Foreign Direct Investment (FDI) in the continent, measured in terms of gross domestic product (GDP).

Company Registration Uruguay 

Setting up a company in Uruguay – what are the main features?

• Uruguay is a stable, secure jurisdiction with a sophisticated legal system and developed economy
• Uruguay is politically and economically stable, making Uruguay company formation a good long-term solution
• 100% foreign ownership is permitted
• A minimum of one director and one shareholder is required, who can be of any nationality and need not be resident in Uruguay
• Corporate shareholders are permitted
• Following the incorporation of a SAFI, shareholders’ and directors’ details are not available for public viewing
• If properly structured, a SAFI is legally exempt from corporation tax provided certain conditions are met. One such condition is that the company is not permitted to conduct business in Uruguay
• International entrepreneurs use the Uruguayan SAFI for the following activities: i) investing in securities, bonds, shares, notes, debentures ii) real estate investment and iii) legally tax-exempt international trade.
• A Uruguayan limited liability company is subject to a profits tax of 30% on international and local income
• A Uruguayan company is also required to register for value added tax (VAT), currently levied at 23%Hundreds of global and regional corporations have set up operations in Uruguay’s tax-free zones, to take advantage of this beneficial tax system and Uruguay’s qualified workforce. Our firm helps incorporate companies to operate in the tax-free-zones, and provides the ongoing tax, accounting and regulatory filing advice.
• Our services include:
• Uruguayan companies (Sociedades Anonimas, or SAs) are popular vehicles to hold foreign assets or conduct overseas business. In addition, the country boasts a dozen tax-free trade zones (Zonas Francas), that is, geographic areas where there is zero taxation on the services provided and goods sold from within such areas.

• Local company incorporation
• Tax-Free Trade Zone company incorporation
• Assistance with business-plan drafting for Tax-Free Trade Zone company permit
• Overseas company incorporation and local registration
• Permanent tax, accounting and bookkeeping
• Comprehensive tax advice
• Double-taxation advice
• Local and non-local labor hiring
• Banking advice for operationsThe company is Uruguay is called the SA company, or Sociedad Anónima. Some SA companies, formed in Free Zones (Zonas Francas) have substantial tax concessions. Formerly there were companies called SAFI's, which are well known and fiscally transparent. No new ones can now be created.
• Incorporation of Companies in Uruguay
• Types of Company in Uruguay

• The draft company statutes need to be signed with a notary. A standard form of company deeds can be used.
• The company statutes need to be approved by the Registry (Auditoría Interna de la Nación) .
• The deeds and the new company needs to be registered with the National Registry of Commerce (Registro Nacional de Comercio)
• A summary of the Statutes needs to be published in the Official Gazette and in one local newspaper
• The company is then registered with the Tax Administration Directorate (Direccion General Impositiva)When the company is formed, the following books need to be stamped by the National Registry:
• Legalization of Company Books

• The Journal
• The stock book,
• The letter copybook,
• The register of minutes of board meetings
• The register of minutes of shareholders’ meetings
• The shareholders’ meeting attendance book.A document is lodged with the Commercial Registry stating the subscribers’ names and national identification numbers. This document is considered to be needed in order to allow the company to open a bank account and to start commercial activities.The company has to be registered with the Tax Administration (the "Direction General Impositiva") and with the Social Security Fund (Banco de Previsión Social)
• Registration of the Company for Taxes
• Declarations to Commence Activities