Salmon companies exempt from paying initial dividends
A technical committee designated by the Superintendent of Insurance and Securities (SVS) is overseeing the current implementation of the International Financial Reporting Standards (IFRS). According to Estrategia.cl, as the law currently stands, Anonymous Society companies (companies ending in “S.A.”) must pay a minimum of 30% of their revenues as shareholder dividends. During the first phase of the IFRS implementation, the technical committee is considering leaving companies with biological assets such as aquaculture or silviculture (forestry) companies exempt from reporting an obligatory 30% as dividend payment. For these types of companies their initial revenue would be reflected by the possession of assets, and not for the transformation in cash upon making a sale. “It takes years to grow a forest or to raise a salmon, and theoretically, during this period a company can only project its revenues. Thus, there may be cases where some companies would have to go into debt in order to pay their shareholder dividends,” states a SVS committee member. The committee is not concerned about jeopardizing minor shareholders, but rather that there are no information system bottlenecks to impede companies from generating information.
