Last Updated June 10, 2019

Law and Practice

Contributed By Ferrere Abogados

Authors



Ferrere Abogados is the only multi-jurisdictional, purely South American law firm, and has 250 attorneys across Bolivia, Ecuador, Paraguay and Uruguay, offering international-class service and participating in the majority of important deals. The M&A practice group works in collaboration with the firm’s other areas to form a multidisciplinary team offering full-service legal advice. It represents a stellar list of international and local clients from a wide range of sectors, such as retail, energy, infrastructure, insurance, construction, media and information technology, agribusiness, food, pharmaceutical, banking and real estate. Activity includes acting as buyer’s or seller’s counsel in acquisitions, leading applications for concessions, advising on greenfield projects, and developing ex ante a BIT protection strategy for a major investment.

The principal duties of directors in a business combination are basically the same duties they have in general: the duty of loyalty and the duty of acting with the diligence of a good businessman. These duties are with respect to the company.

Also, directors have the general duty to negotiate in good faith with respect to all the stakeholders involved.

It is not common for boards of directors to establish special or ad hoc committees in business combinations.

Although there are not many judicial cases in Uruguay related to takeover situations, courts generally defer to the judgement of the board of directors for business decisions (known as the 'business judgement rule' in the US), except when there is a conflict of interest or when the board of directors acts against prohibitive or imperative rules.

Companies involved in a business combination in Uruguay usually rely on external counsel and external financial and tax consultants.

Conflicts of interest of directors and shareholders have been the subject of judicial scrutiny in Uruguay, mainly in cases where the directors or the shareholders compete with the company, or where the directors perform transactions with the company without the necessary disclosures or approvals from the rest of the directors or the shareholders. 

Ferrere Abogados

Juncal 1392

+598 2900 1000

ferrere@ferrere.com www.ferrere.com
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Authors



Ferrere Abogados is the only multi-jurisdictional, purely South American law firm, and has 250 attorneys across Bolivia, Ecuador, Paraguay and Uruguay, offering international-class service and participating in the majority of important deals. The M&A practice group works in collaboration with the firm’s other areas to form a multidisciplinary team offering full-service legal advice. It represents a stellar list of international and local clients from a wide range of sectors, such as retail, energy, infrastructure, insurance, construction, media and information technology, agribusiness, food, pharmaceutical, banking and real estate. Activity includes acting as buyer’s or seller’s counsel in acquisitions, leading applications for concessions, advising on greenfield projects, and developing ex ante a BIT protection strategy for a major investment.

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