The contribution of money in usufruct

Through Official Letter 220-197422 of August 30, 2017, the Superintendence of Companies established its position regarding the contribution of money in usufruct in the sense of establishing that "it proceeds [this] as payment of the quotas or shares that integrate the capital of a company, given its condition of fungible thing (...) either at the time of incorporation, or in subsequent capitalizations".

This thesis is far from the position adopted by the Superintendence of Finance (Concept 2008076062-001 of December 2, 2008) according to which the payment of corporate contributions with the usufruct of an asset should be made with those goods other than money.

Commercial legislation allows the payment of shares or quotas subscribed in an issue with the usufruct of a certain asset. Article 127 of the Code of Commerce, which establishes the rules related to the manner in which such contribution must be determined, indicates that "with respect to the things contributed in usufruct, the company will have the same rights and obligations of the common usufructuary (...)". Likewise, Article 143 of the Code of Commerce establishes that, during the corporate term, the partners may only request the restitution of their contribution "in the case of things contributed only in usufruct, if such restitution has been stipulated and regulated in the contract".

According to the civil regulation, the usufructee of a movable property may use it, but at the end of the usufruct he must return it in the state in which it is found. Likewise, in the case of usufruct over fungible goods, the usufructuary becomes the owner of such goods and the owner is merely obliged to deliver other goods of the same quantity and quality. Likewise, the civil regulation indicates that the civil fruits belong to the usufructuary, day by day (Arts. 846, 848 and 849 of the Civil Code). In this regard, the Spanish doctrine (sevillaflores.es) has considered that the usufruct of money "constitutes a quasi usufruct or improper usufruct (...) which provides that if the usufruct includes things that cannot be used without consuming them -such as money-, the usufructuary will have the right to use them with the obligation to pay the amount of their appraisal at the end of the usufruct (...)".

The aforementioned Official Letter of the Superintendence of Corporations is clear in indicating that, according to the rules analyzed above, the property contributed in usufruct (in this case, the money) may be returned to the contributor at the end of the term of the usufruct, but the fruits generated by such contribution will always belong to the usufructuary since "these constitute in themselves the real contribution that is part of the corporate capital".

The interpretation made by the Superintendence of Corporations is valid and is in accordance with both civil and commercial law, and allows to legally differentiate the operation of contribution of money for the payment of shares from the operation of contribution of money in usufruct for the payment of shares.

While in the former the contributor receives in exchange for his contribution a participation in the subscribed capital of the company and, as a shareholder, becomes a long-term unsecured creditor, in the latter the contributor, simultaneously to becoming a shareholder of the company, also becomes a privileged creditor of the company (such creditor may even be secured in real, personal or movable property) by reflecting such liability within the accounts payable to the partners.

Likewise, for tax purposes, the effect of the fact that a liability in favor of a partner is recorded in the partnership's equity must be taken into consideration, in addition to the existing benefit of not generating presumptive interest on such debt (since it is not generated by virtue of a debt operation) nor compute the same to determine the liquid equity based on the thin capitalization regime since it is not a debt that generates interest.