The S.A.S: a mechanism to protect family wealth

By: María José Hernández

Since the enactment of Law 1258 of 2008, Simplified Joint-Stock Companies (S.A.S) have become the leading corporate vehicle in Colombia, thanks to their flexibility, legal certainty, and ease of incorporation and administration. This has allowed S.A.S to extend beyond the purely commercial sphere and serve as a tool for protecting the wealth of Colombian families, anticipating events such as death, divorce, or separation.

The S.A.S allows broad freedom of regulation, with bylaws that can be tailored to the specific needs of the company and its shareholders. This flexibility makes it possible to organize and protect family wealth and to plan ahead for the events mentioned above.

For example, as established in Official Letter 220-138872 of June 11, 2024 issued by the Superintendence of Companies, the corporate purpose may be focused on protecting, safeguarding and shielding the company’s assets as family wealth — creating different classes and series of shares, setting forth shareholders’ rights and restrictions (and even providing that those rights exist only while the shares remain in the hands of the original shareholder), and including clauses on share-transfer restrictions, share-purchase options, preference rights in share subscriptions and potential grounds for shareholder exclusion.

With this in place, it is no longer necessary to wait for the succession or the liquidation of the marital/property partnership — and to bear the uncertainty, time and wear-and-tear those processes entail. Instead, family-member shareholders can contribute their assets to the company in exchange for shares in the S.A.S, which will carry duly regulated conditions, rights and restrictions.

The Superintendence of Companies has recognized this attribute of the S.A.S and has allowed bylaws to regulate, in advance, the corporate effects derived from those events — provided that mandatory rules and the rights of third parties are respected. In other words, while it is a mechanism that protects family wealth, it can never run counter to the law, nor disregard the succession regime and its forced allocations in the case of a shareholder’s death, nor disregard the marital share that may apply in the event of divorce or dissolution of a common-law marriage. Doing so could trigger a piercing-of-the-corporate-veil proceeding, as noted in Rulings 2019-01-372391 of October 15, 2019 and 2024-800-00094 of November 6, 2025 of the Superintendence of Companies.

It is not, therefore, a matter of evading the law, but of planning and protecting family wealth within it — and the S.A.S is an ideal mechanism for that purpose. Doing so, however, requires expert advice to operate within the legal framework, avoiding any harm to the rights of spouses, heirs or third parties, and ensuring the continuity in Colombia of the instrument introduced by Law 1258 of 2008.