The Office of Companies of the City of Buenos Aires regulated the registration of trust agreements

Through General Resolution 34/2020, published in the Official Gazette on August 5, 2020, the Office of Companies of the City of Buenos Aires (the “Office of Companies”), established the obligation to comply with female quotas in the administration and supervision organs of certain companies.

Included Legal Entities

1. Civil associations;
2. Simple associations that request their registration before the Office of Companies;
3. The following corporations (sociedades anonimas, commonly known by its acronym SA) subject to preventive surveillance regime (section 299 of the General Companies Law): (i) companies with a participation by the federal state; (ii) companies that are engaged in capitalization/savings operations or that solicit funds or securities from the public; (iii) public services concessionaires ; (iv) companies that control or are controlled by companies under permanent supervision included in this regime;
4. Foundations with a temporary and elective board of directors; and
5. State-owned companies.

The most commonly used companies have been explicitly excluded from the regulation and therefore will not have to comply with the gender quota (ie. Limited liability companies –known as SRL-, corporations –known as SA- not subject to preventive surveillance, or those that are under preventive surveillance due to their capital stock or because they are publicly traded (and therefore subject to the control of the National Exchange Commission), single shareholders corporations –known as SAU, and simplified stock companies- SAS).

Fulfillment opportunity:

1. New legal entities that are registered after the resolution’s effective date must comply with the imposed quotas;
2. Existing legal entities, must comply with the required quota from the first appointment of the authorities (that is, if the registration of a previously resolved appointment is requested, the fulfillment of the quotas would not be required).

Quota system:

As a consequence of the resolution under analysis, the included legal entities comply with the following quotas in their administration and supervision boards:

1. boards with an even number of members, a proportion of 50% of male members and 50% of female members must be respected;
2. boards with an odd number of members, at least 1/3 of the positions must be held by women.

The Office of Companies may grant partial, complete, transitory or definitive exceptions to specific requests, but has not established guidelines in this regard.

Gender Policy – Annual Report incorporation

The annual reports of all legal entities domiciled in the City of Buenos Aires, that is, not only those reached by the quota regime, must contain a description of the gender policy and the measures taken in relation to it.

Penalties

In the event of legal entities that fail to comply with the provisions of the resolution, in addition to the fact that the registration of their administrative organ-or the constitution of the legal entity if it is not already existing- may probably be objected prevented, the Office of Companies will inform the National Institute against Discrimination, Xenophobia and Racism and the Ministry of Women, Gender and Diversity to intervene in each case.