The Office of Companies of the City of Buenos Aires published a new general regulatory framework, which, among other things, allows the transformation of foundations and civil associations into commercial companies under the Argentine Companies Act. Additionally, the new regulation allows non-for-profit entities such as foundations and civil associations to purchase shares of any corporation. In this way, the Office of Companies regulates the reform enacted by in December 2023 by Decree 70/2023 to Article 77, Section 1 of the Argentine Companies Act. This new regulation was published on July 16, 2024, through General Resolution No. 15/2024.
The Resolution, in its recital 32, states that, pursuant to the provisions of the DNU, “(…) the participation of civil associations and foundations as shareholders in joint-stock companies and the transformation of civil associations into joint-stock companies must be accepted (…)”.
The Resolution allows (i) the transformation of foundations and civil associations into corporations under the Argentine Companies Act, in accordance with the provisions of Article 77, Section 1 of said law, and (ii) the purchase of shares and participation in the share capital of joint-stock companies by foundations and civil associations, through the affirmative vote of 2/3 of the members or board of directors.
However, for the time being, the bylaws of the Argentine Football Association (AFA) establishes that only those entities that are civil associations with legal personality, in accordance with the provisions of the Argentine Civil and Commercial Code, will be considered “clubs”.
Overall, as derived from the DNU and the Resolution, the new regulatory framework does not obligate football clubs to transform. Instead, it offers them the freedom to adopt a new organizational structure, should their members decide so by majority.
