DOMINICAN REPUBLIC Law and Practice Contributed by: Sarah de León Perelló, Elizabeth Silfa Micheli and Naomi Rodríguez Manzueta, Headrick Rizik Álvarez & Fernández
3.3 Ongoing Reporting and Disclosure Obligations Reporting and Disclosure Obligations Private companies are subject to reporting and dis - closure obligations. Every year, the board of direc - tors or the manager or managers, as applicable, must prepare an annual management report. In addition, where companies have a statutory auditor, the statu - tory auditor must also prepare an annual report. Com - panies must hold an annual shareholders’ meeting, within the first 120 days after the end of the fiscal year, to discuss and approve the accounts of the previous fiscal year. The audited financial statements (when applicable), the annual management report, the reso - lutions to be submitted to the shareholders and the statutory auditor’s report (when applicable) mustl be made available to the shareholders at the company’s registered address during the 15 days preceding the meeting. Changes in management, statutory auditor and/ or shareholders, capital increase, domicile change, amendments of by-laws, dissolution, mergers, the minutes of shareholders meetings and any other rele - vant corporate documents, must be registered before the Mercantile Registry, which is a public registry. The registration of documents in the Mercantile Registry grants these documents effectiveness against third parties. There is, however, no governmental agency in charge of enforcing these filings or corporate gov - ernance in general, unless it is a listed company or regulated sector. In addition, companies are subject to monthly and Companies should register the general information regarding the company (domicile, share capital, share - holding structure, management, etc) with the corre - sponding Mercantile Registry and the Tax Department (DGII, by its Spanish acronym). Relevant changes to the company’s registered information should also be reported. Financial Statements All commercial entities that borrow funds from third parties, issue securities of any nature or have gross annual tax reporting and filings. Notice of Relevant Changes
income greater than 100 minimum wages must have their financial statements audited in accordance with the norms of the Certified Public Accountants Institute of the Dominican Republic. Ultimate Beneficiary Under Anti-Money Laundering and Terrorism Act (“Law No 155-17”), companies must disclose to DGII general information on the ultimate beneficial owners of the company. A “beneficial owner” is defined as the natural person who exercises final effective control over a legal person or that holds at least 20% of the share capital of said legal person, including the natural person for the benefit of whom a transaction is carried out. The disclosure of the company’s ultimate benefi - cial owner(s) is conducted through the filing of form RC-02 (necessary to register changes in the RNC of the DGII) and is also requested as part of the annual tax declaration forms (IR-2) and other applicable tax forms. Tax Compliance Officer Legal entities must register with the DGII the indi - vidual responsible for ensuring compliance with the company or legal entity’s tax obligations, (ie, a tax compliance officer). This individual must accept their appointment at an annual shareholders’ or members’ meeting and must sign the RC-02 form. The individual designated as responsible for the com - pany or legal entity’s tax obligations must hold one or more of the positions specified by law, that is, presi - dent, vice-president, director, manager or legal repre - sentative. According to the notice issued by the DGII regarding the registration of the tax compliance offic - er, this individual may not be someone unrelated to the administration, control or operations of the business or entity. If this update is not completed, the DGII will assign this responsibility ex officio to the individual designated as manager or director, or to the individual with the largest ownership interest in the company. 3.4 Management Structures The company’s by-laws shall determine the rules in connection with its management structure. Directors are appointed by the shareholders. The management structures available for the more commonly used cor - porate vehicles are set out below.
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