Commercial Court of Appeals confirms that an error in the declaration of a corporate domicile is a fineable offence.

Background

Through Resolution No. 10865/2015, the Public Registry of Commerce of the City of Buenos Aires ("Inspección General de Justicia" or "IGJ") applied a fine of AR$ 3,000 to Belgaum S.A., and required the company to amend within a 15-day term the registration of their corporate domicile with the IGJ, under penalty of applying greater sanctions.

The fine was applied as a consequence of an error made in the affidavit filed by the company with the IGJ in compliance of General Resolution 1/2010, in which the domicile declared (Av. Monroe 5163, 3rd Floor, City of Buenos Aires) was different from the domicile that the company had declared in their previous registration (Av. Monroe 5163, 4th Floor, City of Buenos Aires).

In a decision dated November 10, 2016 in re: "Inspección General de Justicia c/ Belgaum S.A. s/ Organismos Externos" Tribunal F of the Commercial Court of Appeals confirmed the fine applied but modified its amount.

Grounds of the defense

Belgaum S.A. grounded its defense primarily on the fact that the company had not intended to provide false information to the IGJ, and that such mistake was a typo of the floor of the corporate address. 

In addition, the company pointed out that at the time of the filing of the affidavit with the IGJ a member of the company had passed away and new members were appointed, and in such circumstances a new affidavit was filed in which this error was made.  

The company highlighted that it had never filed false information, that it had not requested the IGJ for a change of its domicile, and therefore it requested the Court to reverse the IGJ fine.

Grounds of the Court

The Court considered that the purpose of the IGJ is to highlight the certainty and effectiveness of the acts published in the case; i.e. the correct registration of the corporate domicile, and the transparency of trade and compliance with its own inspection role. 

Regarding the issuance of laws and resolutions of any regulatory office, the Court considered that strict compliance of its regulations is required from users. Additionally, the Court pointed out that the company did not question the fact that the corporate domicile provided in the affidavit did not match the one reported on previous filings, which is inexcusable from a legal standpoint.

The Court confirmed the fine applied to the Company by the IGJ but reduced the fine by half to AR$ 1,500 which seems more reasonable considering the levity of the infraction and the lack of other negative precedents of the company.

Final comment

The error was most probably an unintentional typo without serious consequences.  However, since the IGJ and Tribunal F of the Commercial Court of Appeals considered that such mistake should be punished with a fine, this serves as a warning for all information filed with the IGJ.

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