Paraguay (PY)

Jurisdiction Overview

IDQuestionAnswer
172 *Are bearer shares available? No, bearer shares are not available/not circulating.
 Data Date: 2019

Notes

 
In October 2017, a new legislation (Law 5895/2017) was passed that required shareholders to exchange their bearer shares for nominative ones in the following two years, being economic rights related to such shares suspended until the formalization of the conversion (Law 5895/2017, Article 3). Legal entities that had not converted 90% of their shares to nominative ones in due time would not be allowed to operate in the financial system, and their TINs would be blocked (Law 5895/2017, Article 4). By October 2019 there were still around 11,500 entities with bearer shares in Paraguay (ultimahora.com). By the end of 2019, a new legislation was passed which extended the deadline for the exchange of bearer shares for 180 days, and dictated that after such period, the bearer shares that have not been exchanged would lose their economic rights (Law 6399/2019, Article 1 modifying Art. 3 of Law 5895). The new legislation also modified Article 4 of Law 5895/2017, dictating that entities that have not started the process of changing all their shares to nominative ones after the six-month transition period will not be allowed to operate in the financial system, will have their TINs blocked and will be liquidated (Law 6399/2019, Article 1 modifying Art. 4 of Law 5895).
 
Until 2017, bearer shares were available and authorities had no way to know the identity of their holders (GAFISUD 2008: 179); and while there had been resolutions (e.g. Resolution SEPRELAD 345) for companies (with bearer shares) dealing with banks, it appears that this did not apply to other companies not dealing with Banks in Paraguay.

Sources

Law 5895/2017: Articles 3 and 4; Law 6399/2019: Article 1 modifying Articles 3 and 4 of Law 5895/2017; GAFISUD 2008: 179.
 
http://www.abc.com.py/edicion-impresa/economia/seprelad-reglamenta-registro-de-las-acciones-al-portador-1406082.html
 
https://www.ultimahora.com/alrededor-11500-sa-aun-deben-tramitar-el-canje-sus-acciones-n2849097.html