Nicaragua Introduces New Corporate Representation Requirements Under Its Anti-Money Laundering Framework

By Guy José Bendaña-Guerrero & Asociado

On June 19, 2026, Law No. 1282 was published in La Gaceta, Official Gazette No. 111, introducing significant amendments to Nicaragua's legal framework on the prevention of money laundering, terrorist financing, and the financing of the proliferation of weapons of mass destruction.

Although the reform addresses several aspects of the country's anti-money laundering (AML) regime, one of its most significant practical implications concerns the manner in which shareholders may be represented in corporate matters. The amendments establish new formalities that will directly affect the organization of shareholders' meetings and the registration of corporate resolutions before the Nicaraguan Commercial Registry.

The following is an overview of the most relevant changes.

Corporate Transparency

The amendments do not introduce additional corporate transparency obligations beyond those already established under existing legislation. Accordingly, companies' current obligations regarding the identification and maintenance of beneficial ownership information remain substantially unchanged.

Expanded Scope of Beneficial Ownership Disclosure

One of the amendments broadens the circumstances under which beneficial ownership information must be disclosed whenever a shareholder acts through a third party.

The revised provision applies to any situation in which a shareholder is represented by another person rather than acting directly. This encompasses not only complex agency or nominee arrangements but also routine corporate scenarios, such as when a corporate shareholder appoints an individual to attend and vote at shareholders' meetings on its behalf.

Mandatory Registration of Shareholder Powers of Attorney

Perhaps the most significant practical change introduced by Law No. 1282 is the requirement that powers of attorney granted by shareholders for corporate representation purposes must now be registered with the Commercial Registry.

This represents a substantial departure from long-standing corporate practice in Nicaragua. Until now, special powers of attorney or proxy letters issued for attendance at a specific shareholders' meeting generally did not require registration.

Under the new legislation, the following requirements will apply:

-The power of attorney must clearly identify both the principal and the attorney-in-fact, as well as the scope of the authority granted, including the right to speak and vote at shareholders' meetings.

-Powers of attorney executed abroad must be duly apostilled or legalized, as applicable, in order to be legally effective in Nicaragua.

-The power of attorney must be registered with the Commercial Registry prior to the shareholders' meeting.

-Once registered, the company must update its Beneficial Ownership Register to reflect the registered power of attorney supporting the shareholder's representation.

Consequences of Non-Compliance

The amendments establish significant legal consequences for failure to comply with these new registration requirements.

If a shareholder's power of attorney has not been duly registered before the meeting, it will have no legal effect against the company. Furthermore, the Commercial Registry may refuse to register any corporate resolutions adopted during that meeting, including the appointment of directors, amendments to the articles of incorporation or bylaws, capital increases, and other corporate acts subject to registration.

In practice, the prior registration of shareholder powers of attorney becomes a prerequisite for the effectiveness of numerous corporate resolutions.

Practical Recommendations

In light of these amendments, companies should review their internal corporate governance procedures and ensure that shareholder powers of attorney are prepared, executed, legalized or apostilled where required, and registered well in advance of any shareholders' meeting.

This recommendation is particularly important for companies with foreign shareholders or corporate shareholders that customarily participate in meetings through appointed representatives.

Advance planning will help avoid delays or obstacles in the registration of corporate resolutions.

Anticipated Administrative Regulations

It is expected that the Commercial Registry will issue additional administrative guidelines in the near future establishing the formal requirements and procedures governing the registration of shareholder powers of attorney.

Such regulations will likely provide further clarification regarding the practical implementation of these reforms and contribute to greater legal certainty for companies and their shareholders.

Final Remarks

Law No. 1282 represents another important step in strengthening Nicaragua's anti-money laundering and corporate transparency framework. At the same time, however, it introduces substantial changes to corporate practice by imposing new formal requirements for shareholder representation.

Companies operating in Nicaragua should promptly assess the impact of these amendments and adapt their corporate governance procedures accordingly in order to avoid delays or potential obstacles affecting the validity and registration of corporate resolutions.

Guy José Bendaña-Guerrero & Asociados will continue monitoring the implementation of these reforms, including any administrative regulations issued by the Commercial Registry, and will keep clients informed of further developments and their practical implications.