CORPORATE TRANSFORMATION IN BOLIVIA: REQUIREMENTS AND LEGAL EFFECTS

Author: LLM. Rigoberto Paredes Ayllón

The transformation of a company allows it to change its corporate structure without affecting its legal continuity, making it a strategic tool in commercial restructuring. In the business context of the Plurinational State of Bolivia, this process is governed by clear legal provisions that safeguard the interests of partners and creditors. This article explains how corporate transformation works and its key legal implications, supported by practical examples.

WHAT IS CORPORATE TRANSFORMATION IN BOLIVIA?

Corporate transformation refers to the process by which a company changes from one legal form to another recognized under current commercial law—for example, from a limited liability company (SRL) to a corporation (SA). This change does not dissolve the company or affect its rights and obligations. As a result, its registration number, existing contracts, and legal relationships remain unchanged.

For instance, a limited liability company seeking to attract more investment can transform into a corporation in order to issue shares. This change enables the company to bring in new shareholders without losing its legal identity.

PARTNERS’ LIABILITY IN CORPORATE TRANSFORMATIONS

One of the most critical aspects of transformation is how partners’ liability is handled. If, under the previous corporate form, partners had unlimited and joint liability, this condition remains in force unless creditors grant their consent. Such consent is presumed in the following cases:

If creditors do not object within thirty days of receiving personal notice.
If they enter into new contracts with the company after the transformation.

In a practical scenario, if a general partnership (sociedad colectiva) transforms into a limited liability company, the partners remain personally liable for obligations incurred before the transformation, unless creditors provide explicit or implied consent.

LEGAL REQUIREMENTS TO TRANSFORM A COMPANY IN BOLIVIA

To carry out a corporate transformation, Bolivian law requires compliance with several formal steps:

Unanimous agreement of the partners, unless otherwise stated in the articles of association.
Preparation of a special balance sheet approved by the partners and made available to creditors for thirty days.
Publication of the transformation resolution in accordance with legal requirements.
Execution of a public deed including details such as withdrawing partners and the corresponding capital.
Registration of the transformation and supporting documents in the Commercial Registry.

These steps ensure transparency and legal certainty, allowing both partners and third parties to have full clarity regarding the corporate transformation.

DISSENTING PARTNERS IN CORPORATE TRANSFORMATIONS IN BOLIVIA

When transformation does not require unanimous consent, absent or dissenting partners have the right to withdraw from the company. However, their liability to third parties remains in effect until the transformation is duly registered.

The remaining partners retain a preferential right to acquire the shares or interests of withdrawing partners unless otherwise agreed. This provision protects the internal balance of the company and prevents the unwanted entry of third parties.

REVOCATION OF THE CORPORATE TRANSFORMATION AGREEMENT IN BOLIVIA

A transformation agreement may be revoked if it has not yet been published and no harm has been caused to third parties or the partners themselves. Revocation also requires unanimous consent, unless the articles of association provide otherwise.

In summary, corporate transformation in Bolivia allows companies to adapt to new business needs without losing legal continuity or affecting contractual relationships. However, the process demands strict compliance with formal legal requirements and careful consideration of the rights of both partners and creditors.

Our law firm provides specialized legal services for corporate transformations, including feasibility analysis, document drafting, and representation before the Commercial Registry. If you are facing a similar situation, do not hesitate to contact us for tailored legal assistance.

Frequently Asked Questions (FAQs)

What types of companies can be transformed?

Any company type recognized under commercial law may be transformed into another type permitted by the same legal framework.

Is legal personality lost when a company is transformed?

No. Transformation does not dissolve the company or affect its legal continuity.

Can creditors prevent the transformation?

Yes, if they object within the legal time frame after being duly notified.

What happens to partners who disagree with the transformation?

They have the right to withdraw from the company but will remain liable for obligations incurred prior to the registration of the transformation.

Can the transformation be reversed?

Yes, as long as it has not been published and no harm has been caused to partners or third parties.

Bibliography

Commercial Code of the Plurinational State of Bolivia
Political Constitution of the State (2009)
Financial System Supervisory Authority (ASFI) – Corporate Regulations

El contenido de este artículo no refleja la opinión técnica de Rigoberto Paredes y Asociados y no debe considerarse como asesoramiento legal sustituto. La información aquí presentada corresponde a la fecha de publicación y puede estar desactualizada al momento de su lectura. Rigoberto Paredes y Asociados no asume responsabilidad por mantener actualizada la información de este artículo, ya que la normativa legal puede cambiar con el tiempo.