Quick Navigation Links About UJ - FAQ - Case Studies - Key Services - Additional Services - Specifikt Svenskt - News - Links

Company and Jurisdictions


Uruguay Sociedad Anonima Financiera de Inversión (SAFI)

Legislation: Standard capital:
Company Law No. 16,060 of November 1989 applies to all legal and administrative matters. The SAFI is regulated and taxed by Law No. 11,073 of June 1948. Minimum authorised capital is USD 50,000, and minimum paid in capital is 5% of the authorised amount. Ready-made companies have a standard authorized capital of USD 100,000.
Annual government fees: Corporate Taxation:
None 0.3% of net asset value.
Time to incorporate: Ready-made companies:
Three to four months. Available.
Minimum members: Registered office required:
One, individual or corporate. Yes, must be maintained in Uruguay.
Local registered agent: Minimum number directors:
Yes. One, individual or corporate. Details of directors not filed with Registrar but must be lodged with tax office.
Officer to be locally resident: AGM required:
No. Yes. Must be held in Uruguay, not later than four months after end of fiscal year.
Annual return required: Financial statements to be prepared and/or audited:
Yes. Financial statements must be presented to tax authority. No. All corporations must complete a tax filing, including balance sheets, by reporting financial statements in a format prescribed by tax authorities.
Balance sheets to be filed: Share register required:
Yes. Yes, at registered office
To be filed with Registrar: Open to public inspection:
No. No, but open to other members
Exchange controls: Redomiciliation permitted:
No. Inwards but and not outwards. Usual procedure is to nominate an already existing foreign company as a shareholder and then liquidate the Uruguayan company, transferring all assets to the shareholder.
Language of incorporation: Confidentiality:
Spanish Legislation imposes strict duty on banks to keep details of clients and their transactions confidential. Professionals adhere to international client confidentiality principles.
Bearer shares permitted:  



  • Not affected by EU savings directive.
  • Not a member of the OECD.
  • Slow and cumbersome incorporation procedures and changes to a company’s constitution.
  • Spanish documentation and civil law code.

International Agreements

OECD Harmful Tax Practices

Uruguay was not one of the 35 jurisdictions identified by the OECD in June 2000 as meeting the technical criteria for being a tax haven. However, at its global forum on harmful tax competition on 4 June 2004 in Berlin, the OECD listed Uruguay as one of 11 additional financial centres that it intends to target as part of its drive to achieve a level playing field.

Tax Information Exchange Agreement (TIEA)


EU Savings Tax Directive

Not applicable.

Financial Action Task Force (FATF)

Uruguay’s regulatory regime was reviewed by the FATF in 2001. It was found to have a “comprehensive” anti-money-laundering system and was not therefore identified by the FATF as a non-cooperative country or territory (NCCT) in the fight against money laundering.

Uruguay has been a member of the Financial Action Task Force for South America (GAFISUD) since its creation in December 2000. In December 2004, Alejandro Montesdeoca Broquetas, Uruguay’s delegate to GAFISUD, was selected to serve as the organisation’s new Executive Director Secretariat. GAFISUD’s mutual evaluation in 2003 noted that Uruguay’s anti-money laundering regime met international standards.

Mutual Legal Assistance Treaties (MLATs)

The US and Uruguay are parties to extradition and mutual legal assistance treaties that entered into force in 1984 and 1994, respectively. Uruguay has signed, but not yet ratified, the UN Convention against Transnational Organised Crime. In 2003 Uruguay ratified the UN International Convention for the Suppression of the Financing of Terrorism. Uruguay also has MLATs in force with Canada, France, Mexico, Spain, and the UK.

Tax Treaties

Treaties have been signed with:

  • Chile
  • Germany
  • Hungary
  • Paraguay .

General Info

Full Country Name: República Oriental del Uruguay
Area: 176,220 sq km (72,930 sq miles)
Population: 3,415,920 (July 2005 est.)
Capital City: Montevideo
Nationality: Uruguayan(s)
People: 88% European descent, 8% Mestizo, 4% Afro-Caribbean
Languages: Spanish, Portunol, or Brazilero (Portuguese-Spanish mix on the Brazilian frontier)
Currency: Uruguayan peso (UYU) – UYU 28.7 per USD (2004)
Government: Constitutional Republic
Legal system: based on Spanish civil law system; accepts compulsory ICJ jurisdiction
Head of State: President Dr Tabaré Vázquez


Uruguay is located in Southern South America, bordering the South Atlantic Ocean. The second smallest country in South America, Uruguay borders two giants, Brazil and Argentina. Just less than half the population lives in Greater Montevideo. Uruguayans are virtually all of European descent, mostly of Spanish and Italian stock.


Uruguayan independence - finally recognised in 1828 - was repeatedly threatened during the 19th century - militarily by Argentina and Brazil, and economically by Britain. Federalist forces in collusion with Argentina besieged Montevideo from 1838-51 and helped create two warring political parties, the Blancos and the Colorados. For the remainder of the century, the contest between the Blancos and Colorados continued, immersing the country in civil war, dictatorship and political intrigue.

After Uruguay's last civil war ended in 1904 the country entered a period of sustained economic growth. Able to produce first class beef for a growing world meat trade, and good quality wool, Uruguay's exports grew in volume and commanded good prices. The two world wars and the Korean War stimulated exports further. By 1950 Uruguay accounted for 3.5% of all Latin American economic activity. Uruguayans enjoyed the standards of living of a developed country and, throughout this period, except for a short period of military rule in the early 1930s, Uruguay remained a constitutional democracy.

Uruguay 's prosperity had ebbed away by the 1960s and it was thrown into turmoil by the Tupamaros guerrilla movement. In 1973, Congress was dissolved, the military was invited to participate in government, and the Tupamaros were effectively neutralised. The military continued to hold sway in national politics until the return to civilian rule on 1 March 1985 with the inauguration of the democratically elected President Julio Maria Sanguinetti.

At the same time Uruguay's economy began to recover. GDP grew an average of 4.2% from 1992 to 1998 and international ratings agencies awarded Uruguay investment grade. Then two catastrophes struck, both because of problems in Uruguay's neighbours. In 1998 Brazil (which bought a quarter of Uruguay's exports) devalued its currency, plunging Uruguay into recession. Then, in 2002, the country's private banking sector (a quarter of its economy) collapsed as Argentines withdrew their deposits from Uruguayan banks. From its 1998 peak to its 2002 trough Uruguay's economy halved in dollar terms.

Government and Politics

Executive branch
Head of State: President Tabare Vazquez (since 1 March 2005) and Vice President Rodolfo Nin Nova (since 1 March 2005)
Head of Government: President Tabare Vazquez (since 1 March 2005) and Vice President Rodolfo NIN NOVA (since 1 March 2005); note - the president is both the chief of state and head of government
Cabinet: Council of Ministers appointed by the president with parliamentary approval
Elections: president and vice president elected on the same ticket by popular vote for five-year terms; election last held 31 October 2004 (next to be held October 2009)
Election results: Tabare Vazquez elected president; percent of vote - Tabare Vazquez 50.5%, Jorge Larranaga 35.1%, Guillermo Stirling 10.3%
Legislative branch

Bicameral General Assembly or Asamblea General consists of Chamber of Senators or Camara de Senadores (30 seats; members are elected by popular vote to serve five-year terms) and Chamber of Representatives or Camara de Representantes (99 seats; members are elected by popular vote to serve five-year terms).

Elections: Chamber of Senators - last held 31 October 2004 (next to be held October 2009); Chamber of Representatives - last held 31 October 2004 (next to be held October 2009).

Election results: Chamber of Senators - seats by party; EP-FA 16, Blanco 11, Colorado Party 3; Chamber of Representatives - seats by party; EP-FA 52, Blanco 36, Colorado Party 10, Independent Party 1.

Judicial branch

Supreme Court (judges are nominated by the president and elected for 10-year terms by the General Assembly).

Political parties and leaders

Colorado Party (Jorge BATLLE Ibanez); National Party or Blanco (Luis Alberto LACALLE Herrera); Encounter/Broad Front Coalition (Encuentro Progresista/Frente Amplio) or EP-FA (Tabare VAZQUEZ); Independent Party (Partido Independiente).

Presidential and parliamentary elections were held on 31 October 2004. The left wing EP-FA headed by Tabaré Vázquez won in the first round with 50.45% of the vote. In addition to winning the national government, EP-FA won a majority in both chambers of Parliament. They beat the two traditional parties: the Colorado Party (centre) and the Blanco Party (centre-right).

The new president Tabaré Vázquez took the Presidency on 1 March 2005 and will remain in office until 1 March 2010. Apart from intervals of unconstitutional rule, this will be the first time any party other than the traditional parties has ruled Uruguay.


Basis economic facts

GDP (2002): USD 49.27 billion

Growth rate (2002): 10.2%

Per capita GDP (2002): USD 14,500

Main industries: F ood processing, electrical machinery, transportation equipment, petroleum products, textiles, chemicals, and beverages

Uruguay ’s strict bank secrecy laws, liberal currency exchange and capital mobility regulations, and overall economic stability made it a regional financial centre. In 2002, banking scandals and mismanagement, along with massive withdrawals of Argentine deposits, led to a near collapse of the Uruguayan banking system, significantly weakening Uruguay’s role. In early August 2002, the IMF granted Uruguay a loan of US$1.5bn to overcome its immediate difficulties, but the country still faced economic problems. The IMF has since approved substantial loans to be used to service the country's debts and to reactivate the economy through the implementation of infrastructure projects.

All four of Uruguay's private domestic banks were closed in 2002. The remains of three of them were merged into one new bank (Nuevo Banco Comercial), which opened in March 2003. Despite this economic turmoil, Uruguay maintained political and social stability.

Offshore banks are subject to the same laws and regulations as local banks, with the government requiring them to be licensed through a formal process that includes a background investigation. There are six offshore banks and 21 representatives of foreign banks. There are no records of the number of Uruguayan offshore firms or shell companies. Offshore trusts are not allowed. Bearer shares may not be used in banks and institutions under the authority of the Central Bank, and any share transactions must be authorised by the Central Bank.

In December 2003, the Uruguayan Chamber of Deputies approved a bill designed to limit bank secrecy and confidentiality. The bill is intended to increase credit transparency by eliminating bank secrecy for information pertaining to personal loans, financial credits, mortgages, or similar obligations. As of the end of 2004, however, the bill was still pending in commission in the Senate and had not been approved into law.

In its 2003 mutual evaluation report, GAFISUD made several suggestions to expand the scope of Uruguayan money laundering legislation as it relates to gambling, real estate, certain professions (primarily in the legal and financial services sectors), and the smuggling of cash and securities. GAFISUD also suggested that the government improve its investigative and administrative capabilities.

In September 2004, the Uruguayan Congress approved Law 17,835, which significantly strengthened the money-laundering regime. The law incorporated all of GAFISUD’s recommendations that had to be legislated, while other recommendations were met over the past two years through administrative regulations. The 2004 law expands the realm of entities subject to the filing of suspicious activities reports (SARs) and makes reporting of such activities a legal obligation. It specifically confers to the Central Bank’s Financial Information and Analysis Unit (UIAF) the role of receiving and analyzing SARs, and the authority to request additional related information. The law also includes specific provisions related to the financing of terrorism and to the freezing of assets linked to terrorist organizations, as well as to undercover operations and controlled deliveries.

Uruguay has a slightly unusual system of taxation. Individuals are not subject to tax but corporations would normally pay tax at a rate of 35%. However tax exemptions are granted to certain types of Uruguayan companies making Uruguay an important base for tax planning.

There are two types of Uruguayan company that will be of interest to investors and tax planners:

  • Sociedad Anonima Financiera de Inversion (SAFI) is a type of Uruguayan offshore company that is exempt from all forms of taxation on profit. SAFIs pay an annual licence fee to the government equal to 0.3% of the net asset value. The taxable base is calculated by taking the amount of shareholder equity and adding to it a figure equal to all liabilities minus twice the shareholder equity. This somewhat complicated calculation normally results in only a nominal figure becoming payable. SAFIs cannot trade or own real estate within Uruguay but otherwise are subject to few restrictions on their activities and little in the way of bureaucracy. Because of their ease of use and the fact that Uruguay is not perceived as a tax haven, SAFIs can be extremely useful vehicles through which to conduct trading and investment activities worldwide.
  • Sociedad Anonima Usuaria de Zona Franca (SAZF) are companies established within a free zone that are exempt from all forms of taxation except that there is a 30% withholding tax on dividends paid to non-residents. 75% of the employees of an SAZF must be Uruguayan (although this percentage may be reduced upon special application) and social security contributions must be made on behalf of these employees. Other than this the SAZF is subject to few restrictions.
The free zones were created in 1988 in a number of different locations within Uruguay. Presently free trade zones have been established in Colonia, Florida, Nueva Helvecia, Nueva Palmira, Rio Negro, Rivera, San José and Montevideo. In certain cases ownership rests with the government but all operations are run by private enterprise.

Uruguay is a founder member of Mercosur, the Southern Cone Common Market, along with Paraguay, Brazil and Argentina. Mercosur, founded in 1991, has been a success in promoting increased trade among its members as well as with the outside world, although the recent recessionary years have made continued progress more complex. Montevideo is the site of its Administrative Secretariat. Indications are that Uruguay will join the G20, but there has been no official confirmation.

Compliant XHTML | CSS | 508 | AAA

© Copyright 2005 Utlandsjuristen. Art Direction & Photography by Kamilian. Designed & Developed by iWeb