1) The Large Investments Regime in Argentina

The so-called Large Investments Regime in Argentina (Régimen de Incentivo para las Grandes Inversiones, hereinafter, RIGI) was created by the Ley de Bases y Puntos de Partida para la Libertad de los Argentinos No. 27742[1] (hereinafter the Ley Bases), published in the Official Gazette of the Nation on 8 July 2024 and effective as of the day following its publication.

2) Who qualifies for the RIGI in Argentina?

a) Eligible legal vehicles

To qualify for the RIGI in Argentina, the investor must incorporate a single project vehicle (vehículo de proyecto únicohereinafter, the VPU), Whose only purpose will be the investment project to be submitted under the RIGI.

The VPU may take different legal forms:

(i) Sociedad Anónima (hereinafter, SA), Sociedad Anónima Unipersonal (hereinafter, SAU), or Sociedad de Responsabilidad Limitada (hereinafter, SRL);

(ii) Branch of a company incorporated abroad (hereinafter Foreign Company Branch);

(iii) Temporary Joint Venture or other similar associative contract;

(iv) The so-called “dedicated branch”: is a branch that may be created by an SA, a SAU, an SRL, or a Foreign Company Branch, wishing to adhere to the RIGI and carrying out one or more activities that will not be part of the investment project, or owning one or more assets that will not be allocated to said project (hereinafter, the Dedicated Branch).

They may also join the RIGI:

(v) Holders of concessions relating to the execution and/or exploitation of infrastructure works and/or provision, operation, and/or management of services, which are provided in competition with other concessionaires, operators, or providers at the local or regional level, if: (i) they submit an investment plan that qualifies as a large investment, and (ii) they satisfy the remaining requirements of the RIGI; and

(vi) Providers of goods or services with imported goods, solely for qualifying for customs incentives regarding the goods, including supplies, that they import for the service they intend to provide to a VPU participating in the RIGI.

2) Eligible investment projects

(i) Qualifying industries

Industries eligible for RIGI are those in the forestry, tourism, infrastructure, mining, technology, iron and steel, energy, oil and gas, and infrastructure sectors.

(ii) Eligible investments

They will be those that:

a) Involve a minimum amount of investment per project in eligible assets equal to or greater than two hundred million US dollars (USD 200,000,000)[2];

b) Foresee for the first and second year, counted from the date of approval of the investment plan and the application for membership, compliance with the minimum investment in eligible assets in the percentage to be established by the Federal Executive Branch which, at the end of those first two years, must be at least forty percent (40%) of the minimum investment amount; and

c) Are considered long-term, i.e., those with a ratio of no more than thirty percent (30%) between, on the one hand, the present value of the expected net cash flow, excluding investments, during the first three years from the first capital disbursement and, on the other hand, the net present value of the capital investments planned during the same period.

Investments in eligible assets will be all those made after the entry into force of the RIGI and intended for the acquisition, production, construction, and/or development of assets assigned to activities included in the RIGI, excluding financial and/or portfolio assets and foreign exchange assets.

However, under certain conditions and limits, the acquisition of quotas, shares, and/or partnership interests in companies that include eligible assets and are merged with a VPU within a certain period; the acquisition of quotas, shares, and/or partnership interests of a VPU that includes eligible assets; the allocation of eligible assets to a Dedicated Branch for its establishment, registration, and adherence to the RIGI may also be considered as eligible assets.

3) Introduction to RIGI

For an introduction to the RIGI, you can read the following article in our Legal Blog: New investments promotion in Argentina: the so-called “RIGI”.

If you would like to have a complimentary full report in PDF format specially prepared by our firm, please contact us upon request.

4) Introduction to the labor reform in Argentina

If you are interested in the significant labor reform in Argentina by the Ley Bases, you can find an introduction by reading the following article in our Legal Blog: Significant labor reform in Argentina: what can’t companies ignore about the Ley Bases?

You can also read about:

Regularization of labor relations in Argentina by the “Ley Bases”. Repeal of labor fines

and

Self-employed workers in the Ley Bases of Argentina: who is included, who is not, and which presumptions apply.

Mario E. Castro Sammartino

[1] You can find the Spanish text here: https://servicios.infoleg.gob.ar/infolegInternet/anexos/400000-404999/401266/norma.htm

[2] The National Executive Branch may establish different minimum amounts of investment in eligible assets per productive sector or sub-sector or per productive stage, equal to or greater than two hundred million United States dollars (USD 200,000,000). In no case may the minimum amount established by the National Executive Branch exceed the amount of nine hundred million US dollars (USD 900,000,000,000), regardless of the productive sector involved.

Projects that may result in the positioning of the Argentine Republic as a new long-term supplier in global markets in which it does not yet have relevant participation, in accordance with the requirements established by the regulations and that involve capital disbursements in successive stages whose minimum investment in eligible assets per stage is equal to or greater than one billion US dollars (USD 1,000,000,000,000), may be classified as Long-Term Strategic Exports by the implementing authority at the time of approval, and in such case shall enjoy additional benefits.

For additional information on these or any other issues related to doing business in Argentina, please, sign up for our Legal Blog or contact us at any time. Our publications exclusively express the author´s opinion and do not purport to be legal counsel on any case. Should you need it, you must consult with your trusted lawyer.​

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