How to Set Up a Business in Uruguay in 6 Steps

Registering a business in Uruguay offers entrepreneurs a straightforward and efficient way to tap into the country’s dynamic opportunities and favorable business environment. With a strong regulatory framework and a pro-business climate, Uruguay provides a solid foundation for market entry and long-term success. To set up a business in Uruguay also allows investors to take advantage of a stable and supportive market. At Biz Latin Hub, our expertise in regional legal and cultural nuances ensures a seamless setup process, helping businesses thrive in this vibrant South American nation.

Key Takeaways

How to set up a business in Uruguay in 6 Steps

With the right support, the company formation process of an S.A. or an S.R.L. can be relatively quick and straightforward. No minimum amount of capital is needed, except for financial and insurance companies. Several steps to set up a business in Uruguay need to be taken:

• Step 1 – Approval of the company’s bylaws by The National Audit Office (AIN).
• Step 2 –  The National Trade Register (RNC) needs to register the bylaws.
• Step 3 – The Official Gazette and another newspaper need to publish them in the form of an excerpt.
• Step 4 – Register your companies in The National Tax Administration Office (DGI) to be granted a unique taxpayer number (RUT).
• Step 5 – Register with the Ministry of Work and Social Security (MTSS), the Social Security Administration (BPS)
• Step 6- Register the Ultimate Beneficiary Owner (UBO) with the state bank

Step 1: Company bylaws need to be approved

Once you write the bylaws of your company, you need to validate them with the National Audit Office (AIN). The audit office will make sure that they are legally compliant and make sure that everything is in order according to the law of the land.

Step 2: Register the bylaws

After the validation by the National Audit Office, you will need to bring your bylaws for registration to the National Trade Register (RNC). This will form the basis of your company’s operation going forwards. Although they can later be changed, this requires administrative change and is something you probably want to avoid.

Step 3: Publish your bylaws

The registration of your bylaws will be confirmed by being published in the Official Gazette and another national newspaper. This means that you are fully and publically registered in an open and transparent manner, as well as allowing anyone to inspect said bylaws.

Step 4: Register with National Tax Administration Office (DGI)

Your Business is now nearly registered in Uruguay, but to start having commercial activity in compliance with local tax regulations, you will have to register your company in the National Tax Administration Office (DGI) to obtain your taxpayer number (RUT). This is essential for all official business in the country, such as obtaining a corporate bank account.

Step 5: Register with state labor authorities

From now your company is fully registered in Uruguay, but to start your commercial activity hiring personnel, you will have to register your company with the different work and social administrations, involving the Ministry of Work and Social Security (MTSS), and the Social Security Administration (BPS).

Step 6: Register the Ultimate Beneficiary Owner (UBO)

To adhere with increasing Anti Money Laundering (AML) regulations you are required to notify and register the UBO of the company with the central bank. This is becoming ever more important as the country falls into line with global norms of accounting and fiscal responsibility. You will need to maintain these records as an ongoing project.

3 Legal entity types to set up a business in Uruguay

Small-and-medium-sized enterprises (SMEs) are the most important company types in Uruguay, with more than 170,000 SMEs providing jobs for 60% of the working population, according to the BBVA. But what are the types of legal entities investors need to consider to set up a business in Uruguay?

1. Corporation (Sociedad Anónima – S.A.)

There are two types of corporations:

1. Open Corporation: companies that use public savings or have shares listed on the Montevideo Stock Exchange (BVM).
2. Closed Corporation: has a limited number of shareholders and stocks are not traded publicly on the BVM.

Generally, an S.A. requires a minimum of two founding members to set up a business in Uruguay, who can be either residents or foreigners. In addition, management is mostly executed by a board of directors who can be local or foreign individuals domiciled inside or outside Uruguay. A considerable advantage of the SA is that there are no limitations to the activities that can be conducted except for financial and insurance operations.

2. Limited Liability Partnership (Sociedad de Responsabilidad Limitada – S.R.L.)

In Uruguay, an S.R.L. (Sociedad de Responsabilidad Limitada) is the preferred entity type for SMEs, making it the most commonly used business structure in the country. Similar to corporations, S.R.L.s face no restrictions on the activities they can undertake. The entity can have between 2 and 50 partners, offering flexibility for various business sizes.

3. Simplified Stock Company (S.A.S)

With the introduction of the S.A.S in Uruguay, a more agile and accessible business structure has emerged, offering foreign executives an attractive avenue for market entry and expansion. Its legal status and assets are independent of business owners, reducing personal liability for company activities. It is the most popular company type in the country.

The S.A.S has a big disadvantage, which is the social contributions paid by its administrator, equivalent to a minimum of approximately USD$ 250 when the company has no employees and the higher salary of its employees when it has them.

Foreign branch office registration as an Alternative to set up a business in Uruguay

An alternative to forming an independent local company is the establishment of a foreign branch office in Uruguay. They are theoretically free to perform any business activities but usually follow the business strategy conducted by the parent company. Nevertheless, the company needs to be incorporated to conduct its operations.

The incorporation process is similar to the steps previously outlined and the foreign branch office needs to be registered in the National Trade Register (RNC) stating the parent company’s name, domicile, capital and its managers. Furthermore, registries in the MTSS, BPS and BSE are obligatory for the hiring of dependent employers to set up a business in Uruguay.

Why Set Up a Business in Uruguay?

Uruguay is a fervent advocate of free trade. It is one of the founding members of the Southern Common Market (Mercosur) and has signed numerous free trade agreements (FTAs) with countries around the world.

The country’s main exports are agricultural, mainly beef, dairy products and various crops. In 2023, the main export destinations were China (28%), the European Union (15%), Brazil (14%), Argentina (9%) and the United States (6%) (World Bank, 2024).

The country has a diverse and mature business environment, positioning itself as one of the best countries to set up a business in Latin America. Furthermore, Uruguay’s economic activity is divided into three major sectors: agriculture, industry and services. 

Primary and Secondary Sector

The largest field for exports is the agricultural sector, employing around 9% of the working population and contributing to 6% of the GDP. A major share in this rate is occupied by the fishing industry, livestock breeding (especially cattle) and food products, such as rice and wheat.

The industrial sector accounts for 25% of Uruguay’s GDP and employs more than 20% of the working population. The most important industrial fields are food processing of animals and agricultural products, very attractive industries for those investors who want to set up a business in Uruguay. Other important sectors include wine production and textile manufacturing. 

The tertiary sector

The most important sector in GDP terms is the service sector, contributing to 69% of the economic output and employing 71% of the working population in Uruguay.

The tourism service field is the most important area of the tertiary sector in Uruguay. According to Carlos Fagetti, the director of National Tourism, “Uruguay is investing in the diversification of the tourism sector”. This kind of diversification seeks to stimulate the cultural sector in different cities of the country, increasing the opportunities to set up a business in Uruguay.

On the other hand, the financial system in Uruguay promotes foreign currency operations and a high amount of capital transactions. Furthermore, Uruguay’s stock market has been growing continuously in the last decade, especially because of its large primary stock market.

Common FAQs when you set up a business in Uruguay

Biz Latin Hub can help you set up a business in Uruguay

Uruguay possesses interesting business opportunities, for both small and large companies. Still, the incorporation process can be somewhat challenging without sufficient knowledge of local Uruguayan law or regulation.

By choosing to register a business in Uruguay, entrepreneurs can capitalize on the country’s favorable business environment and emerging economic opportunities. This approach not only facilitates market entry but also ensures compliance with Uruguayan regulations, setting businesses up for long-term success in this vibrant South American nation.

To ensure that you successfully set up a business in Uruguay, it is recommended to work with a local group. Biz Latin Hub has the knowledge and expertise to offer personalized advice in Uruguay and Latin America. Don’t hesitate to contact us here for more specialized information regarding the company formation process.

Learn more about our team and expert authors.