Legal issues in Latin America

1.

A corporation, in Argentina called sociedad anónima, is a legal entity which means that a corporation is a separate entity from its owners. Owners of the corporation are often called stockholders or in some states shareholders. A corporation can be considered as a person, because of its rights and obligations are like the same as a person has. It’s not allowed to corporation have public office, it can’t either vote. One of the obligations that corporation has, is that it has to pay taxes.

There can be two kinds of corporations. One is a profit making corporation and the other is nonprofit making corporation. Both can be held publicly or privately. If the corporation is held publicly the corporation’s stock is traded on a stock exchange. Many people can buy stocks of a public corporation and so come one of the stockholders. If the public corporation is a big enough, there can be even millions of stockholders. Conversely privately held corporation is not traded on an exchange and there are not so many stockholders.

To set up a corporation the founder has to have applications which include corporation’s articles of incorporation with the State, he has to pay an incorporation fee and it has to be proved by the State. When the set up corporation has got approval it has to develop its regulations. Corporation has to shorten some intangible assets in a certain period, which cannot exceed 40 years. These are different kind of organization costs such as legal fees, underwriter’s fees for stock and bond issues and incorporation fees.

When one buys a corporation’s stocks and becomes a stockholder the ownership is presented by stock certificate and that is why the owners are called stockholders. Rights that stockholders have are right to vote the members of the Board of Directors and also any other items requiring stockholders’ actions. They have also right to receive dividends. They have the pre-emptive right which is the first