Business and investment environment

Uruguay is one of the most politically stable and business-friendly countries in Latin America. The promotion and protection of foreign investment has been established as state policy and has been consistently implemented by the three major parties that have alternated in government over the last 30 years.

The current investment promotion system is outlined by Law 16,906 of 1998, and its Regulatory Decree 455 of 2007. The law states that the promotion of investment made by domestic and foreign investors in Uruguay is an issue of national interest, and guarantees equal treatment of national and foreign investors developing any activity.

Foreign investment is not subject to prior approval and the state guarantees the free repatriation of profits and capital.

Uruguay is a member of the following organizations:

  • ALADI (Asociación Latinoamericana de Integración), a Latin American organization that promotes trade, established in 1980 (in accordance with the Treaty of Montevideo);
  • World Trade Organization (WTO) since January 1995; and
  • MERCOSUR (Mercado Común del Sur), a customs union comprising Argentina, Brazil, Paraguay, Uruguay and Venezuela. However, Venezuela is indefinitely suspended since 5 August 2017.
Regulatory framework:

Uruguayan company law is based on civil law. Business investments are regulated under:

  • the Civil Code;
  • the Commercial Code;
  • the Company Law, i.e. Law 16,060 of 1989 and its regulations provided by Decree 335/990 of 1990); the Consumer Protection Law, i.e. Law 17,250 of 2000 and its regulations provided by Decree 244/000 of 2000; and
  • the Competition Law, i.e. Law 18,159 of 2007 and its regulations provided by Decree 404/007 of 2007), which follows the European model.

The Company Law regulates all types of companies, including companies, joint-ventures, and branches or permanent establishments of non-resident companies. The Law provides for an exclusive list of company types and specific rules for, inter alia, their incorporation, operation, governance, liquidation, and relation with members and shareholders.

Before starting operations, companies doing business in Uruguay need the approval of their bylaws from the National Internal Audit Office (Auditoría Interna de la Nación, AIN (National Audit Office)) and must register with:

  • the Public Registry of Commerce (Registro Nacional de Comercio, RNC (Public Registry of Commerce)) (the register of merchants, enterprises and companies);
  • the tax authority (Dirección General Impositiva, DGI (Tax authority));
  • the national entity in charge of the administration of social security matters (Banco de Previsión Social, BPS); and
  • the Labour Ministry (Ministerio de Trabajo y Seguridad Social, MTSS), which maintains the employers’ registry.

Additional registration may be required, depending on the enterprise’s activity. For example, financial entities must obtain authorization to operate from the Central Bank of Uruguay (Banco Central del Uruguay, BCU (Central Bank of Uruguay)) and insurance companies must be authorized to operate by the Insurance Superintendence (a specialized department of the BCU).
Law 19,484 (Fiscal Transparency Law) established a new register to identify the final beneficiary and the holders of registered shares. The registry is kept by the BCU and controlled by the AIN.
The final beneficiaries are those individuals who (directly or indirectly) hold 15% or more of the capital or benefits in a company. Companies operating in Uruguay (i.e. incorporated in Uruguay or having a permanent establishment in Uruguay) or those with an investment above approximately USD 325,000 (IU (Indexed Units) 2.5 million) in Uruguayan assets need to register their beneficiaries.
From 1 January 2017, companies must identify their beneficiaries. Bearer shares companies were obliged to register their beneficiaries before 30 September 2017 (extension was granted until 30 October 2017) and companies with nominative shares or certificates needed to register them before 30 June 2018.
Entities issuing nominative shares must additionally report the names of their shareholders. Bearer shares companies have already provided this information to the BCU.
Companies that do not comply with the obligations would be subject to the following sanctions: monetary penalties up to approximately USD 23,000; prohibition to distribute dividends or profits; prohibition to register acts within the RNC; and suspension of the certificate (certificado único) issued by the DGI.
Newly incorporated companies need to register their beneficiaries within 30 days after the incorporation process has ended (i.e. last publication). Future changes of beneficiaries (or their participation) in existing companies need to be submitted within 30 days if the beneficiary is resident in Uruguay or 90 days if the beneficiary is non-resident in Uruguay.
Limited liability companies having only individuals as partners, unless acting on behalf of another person, do not need to register their beneficiaries as the information is already available within the RNC.
The information submitted to the BCU is confidential. However, under specific circumstances, the registry may be accessed by certain state agencies for specific purposes (e.g. DGI, criminal courts, etc.).

Forms of Buisness Corporate Restructuring Corporate Immigration and Emigration Foreign Investment Investment Restrictions Investment Incentives Investment Guarantee and Protection Economic and Trade Agreements