Societies of Limited Responsibilities and Individual Enterprises of Limited Responsibilities

Societies of Limited Responsibilities

The societies of Limited Responsibilities are those formed by two or more persons by contributions of all partners, who don’t respond personally of the social debts. It is our personal believe that this will be the most commonly used form of company.

Particular Characteristics

• Number of partners: minimum two (2) and maximum of fifty (50)
• Social denomination: a fantasy name can be used or a trade name that will have to be preceded or followed by the words “Society of Limited Responsibilities” or the initials “SRL”. If this indication is omitted the partners will be jointly responsible in front of third parties.
• Capital: the social capital will be divided in social contributions/shares that can’t be represented by negotiable titles. They shall be constituted with a minimum of One Hundred Thousand Dominican Pesos (RD$100,000.00). The Secretariat of State of Industry and Commerce will adjust by regulations every three (3) years, the minimum and maximum amounts of social capital, as well as the minimum of contributions/shares, in accordance with the consumer price index published by the Central Bank of the Dominican Republic as reference index. 
• Assignment and Transmission of Social: the cession of social shares among partners, between ascendants and descendants, and their transmission by succession or common wealth liquidation between husband and wife, will be free, unless statutory stipulations to the contrary. The cession of social shares to third parties outside the society will require the consent of the majority of the partners that represent by at least three quarters (3/4) parts of the social shares. If the cession is not approved, the partners will have to proportionally acquire them, in accordance with the procedures established by Law. 
• Accounts Commissioner: its not obligatory, however, can be designated if at the closing  of the last social exercise, the society, reports a total balance equal or superior to 5 times its social capital or an amount of profit equal or higher to 2/3 parts of the social capital, before the tax deductions. Also the partners that represent 1/10 of the social capital will always be able to demand in referral the designation of an account commissioner.
• Administration of the Society: the SRL will be managed by one or more managers that will have to be Physical persons, partners or not. In front of third parties, the manager(s) will be invested with the amplest powers to act, in all the circumstances, in the name of the society, subject to the powers that the law attributes specifically to the partners. The society will be compromised by the acts and doings of the manager or managers even if this are not related to the social object, unless that is proven that the third party had knowledge that the acts or doings were foreign to the social object or that he could not ignore it under the circumstances.
• Assemblies Partners: the decisions will be taken in assembly. Nevertheless, the statutes will be able to stipulate that all decisions or some of them be adopted by written consultation or by consent of all the partners contained in a minute with or without the necessity of an actual meeting.
• Also the vote of the partners will be able to be pronounced through any electronic or digital means. Unless in occasion of the approval of the report of annual management (Article 110), and in case the celebration of the assembly is required by one or several partners who are titular at least of half (½) of the social contributions/shares or that constitute the quarter (¼) of the partners and simultaneously are proprietors of the quarter (¼) of the social quotas/contributions (article 112).

Individual Enterprises of Limited Responsibilities

The Individual Enterprises of Limited Responsibilities is owned by a physical person and is an entity that has its own legal personality, with capacity to be bearer of rights and obligations, which form an independent patrimony and separated of those other wealth/property of the physical person titular of said enterprise.

Particular Characteristics

·         Number of partners: one (1). Can only be constituted by physical persons.

·         Social Denomination: the name of the enterprise will have to be preceded or followed by the words “Individual Enterprise of Limited Responsibilities” or the initials “EIRL”. It should not have the name, last name or part of them, nickname or any other appellative of one physical person, which in no way will be used as distinguishing mark of the enterprise.

·         Capital will be determined by statutes.

·         Accounts Commissioner: does not exist

·         Administration of the Enterprise: the owner will be able to designate a manager or assume the functions of one. From the start of the operations, the enterprise should open and maintain an accounting in accordance with the legal and regulatory dispositions applied to merchants.

For the commercial societies existing before the coming in effect of the new law, this demands that they are “adjusted” or “transformed”, depending on the interests of each society, to adjust to the new dispositions of the Law 479-08.

With these 2 business types, we have covered the main aspects of the new business law in the Dominican Republic. Please feel free to comment or post your questions and we´ll do our best to address it.

If you have any particular topic or question regarding the laws of the dominican republic, let me know.