Argentina – IGJ Clarifies Director Authority and Introduces Flexible Guarantee Options

Argentina’s General Inspectorate of Justice (IGJ) has issued General Resolution 1/2026, introducing clarifications on corporate representation and greater flexibility in director guarantee requirements. The changes aim to modernize existing rules and reduce administrative burden for companies registered in Buenos Aires.

Regulatory Background

The Resolution addresses two key areas under Argentina’s corporate framework:

1. Corporate Representation

The IGJ has clarified that the appointment, removal, or replacement of directors and legal representatives takes legal effect from the date of the underlying corporate act, rather than from the date of registration. In practice, this means that:

• Directors whose terms have expired remain validly in office until their successors are appointed and assume their roles, in accordance with the applicable holdover provisions.
  This principle does not apply in the same manner to directors who have resigned
• Companies cannot rely on mandate expiration to challenge actions taken by directors acting in good faith toward third parties

This provides greater legal certainty around continuity of representation.

2. Director Guarantee Requirements

The Resolution also amends Article 70 of Annex A of IGJ General Resolution No. 15/2024, introducing “freedom of form” in relation to director guarantees. Companies may now determine the type, cost, and conditions of the required guarantee.

Permitted forms now include:

• Cash deposits and government securities
• Insurance or surety bonds
• Third-party guarantees
• Sworn guarantees (newly recognized)

The introduction of sworn guarantees is intended to simplify compliance and reduce costs associated with director appointments. For registration purposes, confirmation within the pre-qualification report that the guarantee has been established in line with the company’s articles of incorporation is sufficient.

Applicability and Scope

The Resolution applies to all companies registered with the Public Registry of the Autonomous City of Buenos Aires.

Effective Date

The Resolution came into force on the 14^th of April 2026, following publication in the Official Gazette.

Practical Considerations and Ongoing Obligations

While no immediate compliance deadline applies, companies should:

• Review existing constitutional documents to confirm whether sworn guarantees are permitted
• Consider updating articles of incorporation where greater flexibility is desired
• Ensure director guarantee arrangements align with the updated framework for future appointments or re-elections

Any amendment to the articles of incorporation must be approved by shareholders and duly registered.

How Mercator® by Citco (Mercator) Can Help

Mercator can assist with:

• Reviewing the impact of the Resolution on existing governance structures
• Preparing board and shareholder documentation to amend articles of incorporation
• Supporting director appointments and guarantee arrangements, including sworn guarantees

For assistance, please contact mercator@citco.com