EAS: A Quickly Formed Paraguayan Business Entity

What is an EAS?

It’s a commercial business entity whose main characteristic is its fast constitution. With this, you can have a company ready to operate in Paraguay with other shareholders. It can also be formed as a sole proprietorship (with only one partner).

E.A.S. means «Simplified Joint Stock Company». (Empresas por Acciones Simplificadas)

Is it easy to form?

Yes, you can have the company ready to operate in a week, as long as you have all the documents up to date. Mainly the Paraguayan ID. Regarding the Articles of Incorporation, there is a «predetermined version» that is free, which does not require the signature of a lawyer or notary for its validity.

What are the benefits of an EAS?

With an EAS, you save the bureaucracy of registering or reporting to the main Paraguayan government entities. Therefore, when you incorporate, you already have:

• RUC (Tax ID)
• Bank account (Banco Nacional de Fomento)
• IPS (Social Security) and MTESS (Labor Ministry)
• ID Mipymes
• RIEL and REPSE
• DGPEJBF

Can it win bids?

Yes, EASs can bid to win tenders in the Republic of Paraguay, as long as they comply with the guidelines of the competitions.

Does it have annual assemblies and presentations?

Yes, the EAS is like any other company. For example, it must hold an annual General Meeting where the management of the previous year is approved with its respective Balance Sheet and Financial Statements, among other matters. It must also comply with the tax obligations of the Tax Office (DNIT) and other entities such as MTESS, IPS, and DGPEJBF.

Minimum capital?

No, a minimum capital is not required for the formation of the EAS, but a reasonable capital is suggested. For example, if you are going to form a large livestock company, it is not reasonable for your capital to be only 500,000 Guaranies (less than 100 USD).

Is a corporation SRL or Sociedad Anónima better?

It’s not that one is better or worse, but the EAS was simply born as a rapidly formed business entity to avoid cumbersome government procedures. It carries the same legal weight as other corporate structures.

Does it separate personal capital?

Yes, a main characteristic of most companies is that «it stands on its own», meaning that it has its own bank, obligations, and responsibilities. If the EAS takes out a loan, the loan is from the EAS. In case of a problem, the personal assets of its shareholders will not be affected.

Is it easy to get a Paraguayan ID?

Yes, getting a Paraguayan ID is easy.

Taxes in Paraguay

The Annual Income Tax is 10%, the monthly IVA (VAT) is 10%, and the tax on profit withdrawal by shareholders is 8%. If products are exported from Paraguay under the proper conditions, a credit refund can be requested.

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