No More Bearer Shares in Guatemala

The Extinction of Ownership Law includes approved amendments to the Commercial Code, so from now on company shares can only be nominal.

Thursday, December 9, 2010

The Law aims to attack drug trafficking and regulates "the obligations of legal entities or individuals engaged in a profession or activity that could be used for the transfer, use, concealment and movement of goods from criminal or illegal acts.”

Law No. 4021, called " Extinction of Ownership", which takes effect six months after its publication in the official newspaper, includes amendments in the following articles related to shares:

Article 70 amends Article 108.
Article 71 amends Article 195.
Article 72 amends Article 204.

Article 73, which is transient, establishes a two year period in order to change all bearer shares issued before the new law and change them according to fit new regulations.

More on this topic

Panama Approves Immobilization of Bearer Shares

July 2013

Panamanian Congress has finally approved the law which imposes a safekeeping regime on bearer shares.

From a press release issued by the National Assembly of Panama:

Draft Law No. 568, which regulates shares by allowing their immobilization was approved by the plenary of the National Assembly on its third reading.

Discussion of Bearer Shares Reopened in Panama

July 2013

Congress discussed today in the first debate the bill adopting a custody regime applicable to shares issued to bearers.

From a press release issued by the National Assembly of Panama:

The Commission of Economy and Finance of the National Assembly will discuss in a first debate on Tuesday from 2:00 pm Bill 568 "to adopt a custody regime applicable to shares issued to bearers," which was presented by Minister of Economy and Finance, Frank De Lima.

Conversion of Bearer Shares to Nominal Shares

April 2013

Commercial companies in Guatemala have until June 28 to make the conversion.

According to the explanation give by Oscar Chile Monroy in an article in, the Forfeiture Act (LED by its initials in Spanish), does not specifically establish a financial penalty to those who do not perform this procedure in time, however, it should be noted that the omission can bring serious tax consequences and commercial risks.

Tax Shields to Protect Identity of Shareholders

January 2013

In Guatemala "there are still ways to start a business with due secrecy for its owners."

Specialists in corporate and tax law in Guatemala say the Forfeiture Act, Decree 55-2010, leaves the gate open for owners of shares of companies to withhold their identity.

Alvaro Castellanos Howell, a lawyer at the law office Consortium, cited as an example the establishment of a company in countries "where bearer shares are allowed, and then an investment is made in Guatemala with shares, buying moveable goods as an off-shore entity".

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