Frequently Asked Questions
Consulting firm specializing in customs insurance and advice to entrepreneurs
Frequently asked questions about guarantees for company directors.
1. What is the Company Directors' Guarantee?
It is the guarantee required by the Companies Law (Law 19,550, art. 256 paragraph 2) for directors of public limited companies and members of the administrative bodies of other companies (SRL, SCA).
2. Who demands it?
Resolution 20/2004 of the General Inspection of Justice requires that this guarantee be made up of a deposit of cash or public securities, or through the constitution of a surety bond or a bank guarantee.
3. What does the warranty cover?
The policy covers the Company in the event of failure by the director or Managing Partner to fulfill his or her obligations in the performance of his or her duties.
4. Who should take out this policy?
All directors of Joint Stock Companies, Managers of Limited Liability Companies and Administrators of Limited Partnerships. In the Surety Branch, the person who holds the position of director, manager or administrator is called "the Policyholder". It should be noted that the aforementioned IGJ Resolution expressly establishes in its art. 2, inc. 1) "...the cost of which must be borne by each director...".
5. In whose favor is it extended?
The policy is issued in favour of the Company in which the Policyholder holds office. Each director must present an individual guarantee, i.e. if the Board of Directors is made up of 5 members, 5 different policies must be presented.
6. When is the guarantee presented?
In accordance with the provisions of IGJ Res. 20/04, the Company must prove the establishment of the guarantee at the time of registering the directors appointed at the Assembly or whenever the Company must register any public or private instrument in order to comply with corporate resolutions.
7. What is the insured amount for each policy?
The guarantee must have a minimum insured value of $300,000 and a maximum of $1,000,000. (values valid 08/2024)
8. What is the Period of Validity?
The policy must cover the term of office of the director or managing partner. Typically, these are annual periods.
9. When does the risk end?
The risk ends when the Board's management is approved at the Ordinary General Shareholders' Meeting and the Annual Balance Sheet is approved. However, some legal actions have a term of up to 3 years before their prescription occurs.
10. Can the policy be cancelled?
The policy would only be cancelled if the director does not accept the position. As is normal in the Surety Branch, the policy has 2 clauses regarding the validity of the coverage, which state:
Frequently asked questions about insurance, guarantees and bonds for construction.
Offer maintenance:
1. What is the purpose of a Maintenance Offer surety bond?
The Offer Maintenance Surety Insurance is a coverage whose objective is to provide specific guarantees to the insured that the offeror will really maintain the conditions proposed through a tender and that, if awarded, will be presented at the signing of the contract
2. What is the validity of the offer maintenance insurance?
The validity of the policy for Offer Maintenance extends for a period equal to that during which the bidder agrees to maintain its offer in accordance with the terms of the tender document, and the insured amount varies between 1% and 5% of the official budget or the amount offered by the policyholder; although these values may vary depending on each particular case.
Frequently asked questions about Financial Advance and/or Collection?:
1. What is a surety bond for a surety bond policy for financial advance and/or collection?
The Surety Policy for financial advance and/or stockpiling is required by the Client or State Department to make an advance payment, either as financial support or for the purchase of materials as a Guarantee by the recipient (the contractor or supplier). This type of surety insurance guarantees that the advances received by the Policyholder —from the Insured— are used specifically for what is established in the contract signed by both parties.
2. What is the validity of the surety bond or insurance policy?
The sum insured is equivalent to the total amount that the Policyholder will receive as a financial advance. In public works, this type of advance usually amounts to 30% of the total amount stipulated in the contract, but this percentage varies according to what is established in the specifications or contracts.
Rental Guarantees
1. What is rental insurance?
The guarantees for leases are stipulated through a Surety Bond Contract, framed in the Civil and Commercial Code and other laws, and will only apply to issues not covered in this policy and to the extent that this is compatible.
2. What does rental insurance cover?
Article 2: Covered risks. Rent and/or security deposit
3. Is there any cost when starting the process?
NO, there is no cost to request the guarantee.
4. If I start the process and then the operation is NOT carried out, do I have to pay anything?
NO, if the transaction is not completed, for whatever reason, there will be no cost.
5. Can I apply for the surety bond with someone else's pay slip?
No. But it can guarantee the warranty.
Frequently asked questions Registration regime for importers and exporters before the DGA
1. What are the requirements to operate as an Importer-Exporter?
In order to operate as an Importer-Exporter, it is necessary to be registered with the AFIP, complete the documentation required by Customs and prove financial solvency.
2. What does it mean to prove financial solvency?
The financial solvency of a legal entity (public limited companies, limited liability companies, self-employed persons) is determined, as stipulated by the AFIP, by a gross sales amount or by a net worth equal to or greater than three hundred thousand pesos ($300,000), as determined in the sworn declarations of the last fiscal year.
3. What happens to those who cannot prove this financial solvency requirement?
Those who cannot prove financial solvency must provide a guarantee of thirty thousand pesos ($30,000).
4. How should this guarantee of financial solvency be constituted?
The guarantee of financial solvency can be made effective in 4 ways:
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