Argentina has suspended its blockchain-based company registration platform called Companies with Simplified Shares (abbreviated as SAS in the country), reported El Cronista. The country’s General Inspection of Justice (IGJ), which registers and supervises companies, passed a resolution stating the agency should get more control over the companies registered on the blockchain system and hence imposed a sixth month suspension.
Launched in 2017 by the previous government of Mauricio Marci, SAS enabled entrepreneurs to register their business digitally within 24 hours, as opposed to 55 days. The platform is targeted at SMEs and was set up using the Blockchain Federal Argentina (BFA), an open platform initiated by the government.
Since its launch, the SAS has allowed the creation of about 20,000 companies and created over 47,000 jobs. The IGJ said the process began and ended in the ambit of the Ministry of Public Innovation, with the IGJ reviewing the process.
Now, the IGJ wishes to have more say in the registration of companies and has mandated that all documents submitted digitally on the SAS be made available in physical paper form. The suspension of the platform will last for six months.
“There is no control. The Macrismo thought that by enabling the constitution of companies in 24 hours we would have a lot of investments. It was crazy,” said Ricardo Nissen, head of the IGJ.
However, the decision to suspend the blockchain platform has drawn criticism from the Association of Entrepreneurs of Argentina (ASEA).
“It is a decision that delays and hinders the work of Argentine entrepreneurs,” said Alejandro Ramírez, head of Public Policy at ASEA. “Until today, accounting books were kept digitally through the Blockchain system, which guarantees absolute transparency and inviolability in information management. Now, we must return to a nineteenth-century system, completely anachronistic and permeable to any adulteration.”
Another ASEA representative said that SMEs represent 44% of the country’s GDP, and the suspension of the platform would discourage entrepreneurship. ASEA added that the SAS platform was used as a reference by neighboring countries, and was replicated by Ecuador, Uruguay, and Paraguay, among others.
The Argentinian government has been supportive of blockchain, shown by the establishment of the BFA Blockchain. Last year, it announced that it would invest in 40 blockchain projects over the next four years with a partnership with Binance Labs.
Among other projects, NEC Argentina, NGO Bitcoin Argentina, and IDB Lab are working on a Digital Identity for Inclusion Project. The project is said to have been introduced in Buenos Aires to improve access to government services.