Certificate of Validity and Good Standing

As from January 1, 2013 the Public Registry of Commerce of the City of Buenos Aires (Inspección General de Justicia or “IGJ”) may be requested to issue a Certificate of Validity and Good Standing (Certificado de Vigencia y Pleno Cumplimiento or “CEVIP”) regarding commercial companies, corporations, foundations, civil associations and foreign entities which are registered with such public registry.

General Resolution No.12/2012 of the IGJ, published in the Official Gazette on December 11, 2012 (the “Resolution”), provides that the CEVIP will be issued upon request of the entity, its representatives or attorneys-in-fact, provided the entity has complied with the filing of its financial statements, sworn statements and payment of the annual fees (if applicable). If the entity does not comply with any of such requirements, the certificate will not be issued and the procedure will be objected, with an express indication of the causes of non-compliance of the respective entity.

The CEVIP will be valid for a term of six months as from its issuance, and will evidence the (i) validity, (ii) legality and (iii) fully compliance with the registration obligations with the IGJ of the relevant entity.

Pursuant to the background considerations of the Resolution, the CEVIP will also specify the date and the registration details of the last authorities registered with the IGJ. With respect to corporations (sociedades anónimas), the Resolution provides that if the term of the last board of directors registered has expired, the CEVIP will expressly state such situation. This provision is in accordance with Section 257 of Argentine Commercial Companies Law No. 19,550 (as amended) which provides that directors shall remain in their positions until they are replaced. If this situation occurs, the textual quotation of Section 257, paragraph 2 will be included in the certificate: “However the director will remain in its position until [he/she] is replaced”.

The CEVIP will be a useful tool for mergers & acquisitions’ transactions, and will be frequently required in due diligence processes. By means of the issuance of the certificate, the due diligence process will be simplified, since it will enable companies and corporations to evidence the full compliance of their registration obligations effectively. This new regulation follows the guidelines adopted by the registries of commerce of other jurisdictions around the world which provide good standing certificates upon request.