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Corporate Law. Decree No. 196/2015.

Directors. Syndics. Surveillance Committee Members. Officers. Limitation of Responsibility.

By Nicolas Zaballa

On February 12, 2015, Decree No. 196/2015 was published, establishing that:

  • Directors, syndics, surveillance committee members, and officers appointed or proposed by the National Government and any agencies thereof in the corporate bodies of any companies where the National Government owns a stake are public officers for the purposes of limiting their responsibility and in connection with the acts performed in the exercise of their functions.
  • Through relevant jurisdictions and state-run entities, the National Government will provide the necessary specialized assistance or ensure the defense or representation of those officers whenever they are sued, demanded, requested to appear in court, reported, or accused of a crime while in office.
  • The National Government guarantees the indemnity of said officers.

The above assistance and indemnity will not apply if the officer’s acts constitute fraud or negligence or whenever they do not comply with the rules, regulations, instructions, recommendations, or orders given by the competent authorities of the jurisdiction, agency or entity that represents the Government’s shareholding in the respective company.

Finally, Decree No. 196/2015 also provides that it will apply even to pre-existing juridical acts.

Decree No. 196/2015 is consistent with Decree No. 1278/12, which approved the Regulations on Representatives and Directors appointed through the National Government’s shareholdings.