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Legal Newsletter - October 2020

Relevant News

  • Exchange and purchase control of foreign currency
  • Securities trading
  • Health Emergency (COVI-19). Deferral and exceptions
  • Emergency Assistance Program to Work and Production
  • Economy of Knowledge Promotion Regime
  • Minimum Wage
  • Tax on Liquid Fuels and Biodiesel and Bioethanol Prices

LEGISLATION

Communication “A” Nº 7123/20 – Foreign Exchange Controls

By means of Communication “A” Nº 7123/2020 (the “Communication”) the Central Bank of the Argentine Republic (“BCRA”) admits the application of collections of foreign currency resulting from export operations of goods and services to: (i) payment of capital and interest on financial indebtedness with foreign whose average life is not less than one year, and (ii) repatriation of non-resident’s direct investments in companies which are not controllers of local financial entities. The Communication also increases the amount for which importers may access the exchange market (“MULC”) according to BCRA Communication “A” 7030. Moreover, the Communication provides that BCRA’s prior authorization shall not be required for access to MULC for the repatriation of non-resident’s direct investments in companies which are not controllers of local financial entities. Finally, Communication sets forth that BCRA’s prior authorization shall not be required for access to MULC for the payment at maturity of the capital of foreign financial indebtedness of the non-financial private sector when creditor is a related party of debtor, given the funds have been entered and settled in the MULC as from October 2, 2020, and the indebtedness has an average life of no less than 2 years.

Communication “A” Nº 7133/20 – Foreign Exchange Controls on Pre-Payment of Foreign Financial Indebtedness

By means of Communication “A” Nº 7133/2020 (the, “Communication”), BCRA sets forth some regulations applicable to the access to the foreign exchange market for paying foreign financial indebtedness. Among other aspects, the Communication allows the pre-payment of foreign indebtedness being re-financed under section 7 of Communication Nº7106 within 30 days before financing’s maturity date, provided the conditions required in the Communication are met. The Communication also allows to access the foreign exchange market in order to prepay the interests of foreign financial indebtedness or local securities undertaken in foreign currency, when said prepayment was structured as a bond swap and the other conditions provided under the Communication were met. Finally, the BCRA sets forth that the obligation to submit a re-financing plan in accordance with Section 7 of Communication Nº7106, shall be considered complied with if (i) as of October 2019, debtor registers new settlements in the exchange market for an amount equivalent or superior to the exceeding of the 40% limit set forth under Communication Nº7106 in concept of: foreign financial indebtedness or security bonds issued abroad or in Argentina in foreign currency; (ii) regarding security bonds issued in Argentina or abroad as of October 2020, said bond’s average duration is of 2 years or more and its delivery to creditors allows to comply with the parameters of the corresponding re-financing plan.

Communication “A” Nº 7138/20 – Foreign Exchange Controls on Imports. Informative Regime

By means of Communication “A” Nº 7138/2020 the Central Bank of the Argentine Republic (“BCRA”) set forth new requirements for the access to MULC for payment of imports, such as importer’s compliance with the SIMI affidavit (in “exit” status) in relation with the imported goods, importer’s prohibition to pay in advance for the import of goods while having delays with the entry of previously imported goods, and importer’s compliance with the corresponding informative regime for operations involving access to MULC for a daily amount equal or higher than USD 50,000 The Communication also incorporates new operations admitted for the application of collections of foreign currency resulting from export operations of goods and services under BCRA Communication “A” Nº 7123/2020.

Communication “A” Nº 7142/20 – Securities Trading

By means of Communication “A” Nº 7142/2020 the Central Bank of the Argentine Republic (“BCRA”) modifies sections 5 and 6 of BCRA Communication “A” Nº 7106/2020 and therefore relaxes certain restrictions provided therein regarding security trading.

Communication “A” Nº 7151/20 – Foreign Exchange Control Applicable to Imports

By means of Communication “A” Nº 7151/2020 the Central Bank of the Argentine Republic (“BCRA”) sets forth that in order to authorize importers to make payments abroad under Communication A Nº7030, the financial institutions shall verify the information submitted by the importer in its sworn statements with BCRA’s information. The Communication also extends Communication Nº7030 points 2 and 3 and complementary communications’ validity until December 31st, 2020.

General Resolution Nº 862/20 – Parking Period for Securities Trading

By means of General Resolution Nº 862/2020, the National Securities Commission (“CNV”), among others, reduce the minimum term of holding of securities (“parking period”) for certain operations to 3 business days.

Decrees Nº 792/20 and Nº 814/20 – Social, Preventive and Mandatory Isolation

By means of Decrees N° 792/2020 and Nº 814/2020 (the “Decrees”), the Executive Branch provided the deferral until November 8th, 2020 of both the “Obligatory Social, Preventive and Mandatory Distance” (the “DSPO”) and “Social, Preventive and Mandatory Isolation” (the “ASPO”), as set forth in the Decree, closure of national borders and the prohibition of suspending phone and internet services in case of lack of payment. Public transportation shall continue to be limited for essential workers.

Decree Nº 823/20 and Resolution Nº 1954/20 - Emergency Assistance Program to Work and Production

By means of Decree N° 823/2020 (the “Decree”), the Executive Branch provides the deferral until December 31st, 2020 of the Emergency Assistance Program to Work and Production (“ATP”). In addition, by Resolution Nº 1954/2020, Chief of Staff incorporated the recommendations issued by the Evaluation Committee of the Program to Work and Production which include, among others, the extension of the ATP Program regarding complementary salary, and deferral and reduction of payments of contributions to social security system and subsidized rate credits regarding October 2020 salaries.

Law 27.570 – Economy of Knowledge Promotion Regime

Law Nº 27.570 (the “Law”) modifies Law Nº 27.506 which created the Economy of Knowledge Promotion Regime (the “Regime”). The Law aims to encourage new projects and optimization of the services provided by companies of the technology sector. The Law sets forth the tax benefits included under the Regime which include the possibility to transform part of employer’s contributions to the social security system in a fiscal certificate, a reduction in income tax and the elimination of export rights, among others. The Regime shall be valid as from January 2020 for companies which had adhered under Law Nº25,922 and as from october 2020 for new companies and will remain in effect until December 31st, 2029. In addition, the Law determines that beneficiaries of the software industry regime shall inform their will to continue under the Regime. Finally, the fulfillment of the requirements set forth under article 4 of the Law can be deferred until the finalization of the health emergency declared due to the coronavirus pandemic.

Decrees Nº 794/20 and 815/20 - Resolutions Nº4385/20 and Nº 4840/20 – Deferral of Suspension of Deadlines within Administrative Proceedings and Tax Recess

By means of Decree N° 794/2020 and Nº 815/2020, the Executive Branch suspends until November 8th, 2020, the course of administrative deadlines within administrative proceedings. In addition, Resolutions Nº4835/2020 and Nº 4840/2020 issued by Tax Enforcement Authority, determines a new period of the tax recess applicable to the terms of the proceedings for the application, collection and inspection of taxes until November 8th, 2020.

Resolution Nº 4/20 – New Value for the Minimum Wage

By means of Resolution Nº 4/2020, the National Council of Employment, Productivity and Minimum Wage, sets forth the followings new values for the minimum wage: (i) ARS $18.900 payable as of October 1st, 2020; (ii) ARS $$20,587.50 payable as of December 1st, 2020; and (iii) ARS $ 21,600 payable as of March 1st, 2021. The Resolution also ratifies the increase of unemployment benefits (ARS $6,000 to ARS $10,000) provided under Decree 376/20.

Resolution Nº221/20 – Resumption of Local Air Transport Service

Resolution Nº 221/2020 issued by the Ministry of Transportation, abrogates Article 3 of Resolution Nº 64/2020 and allows the resumption of the commercial and general local flight transport system. Passengers who intend to take a local flight shall obtain the “Unique and Enabling Certificate for purposes of Circulation - COVID 19 Emergency”.

Decrees Nº785/20 and 812/20 – Reference Values Applicable to Exports

By means of Decree N° 785/2020, the Executive Branch sets forth until December 31st, 2021, an export duty of 8% applicable to exports of certain products provided therein (includes rocks, granite, gold, among others).

Resolution Nº551/20 – Assistance Program for Strategic Companies Undergoing a Debt Restructuring Process

Resolution Nº 551/2020 issued by the Ministry of Labor, creates a program to provide economic assistance to companies which submit a debt restructuring project and comply with the requirements set forth under the resolution, e.g.: the company must have 500 or more employees, sell goods or services of high technological content or exports with high added value.

General Resolution Nº 4847/20 – Precautionary Measures Against PyMES

By means of General Resolution N° 4847/2020, Tax Enforcement Authority (“AFIP”) defers until November 30, 2020 the suspension of application of precautionary measures against small and medium companies (“PyMES”).

Resolution Nº 4848/20 – Tax Procedures

By means of Resolution Nº 4848/2020, Tax Enforcement Authority (“AFIP”) defers until November 30th, 2020 the use of the service “Digital Submissions” for purposes of certain tax presentations and the relief of registering biometric data required to comply with certain digital transactions.

Resolution Nº 473/20 – Maximum Prices

By means of Resolution Nº 473/2020, the Secretary of Internal Commerce defers until January 31st, 2021 the maximum sale prices for certain goods set forth by Resolution Nº 100/2020. In addition, the companies that produce such goods are requested to increase the production and ensure transportation and supply.

Resolution Nº 43/20 – New Regulations for “SAS” Companies

The Superintendence of Corporations issued Resolution Nº43/2020 applicable to simplified corporate companies (“SAS” for their acronym in Spanish), which among other aspects, sets forth that SAS companies must comply with or update the information of its final beneficiary in accordance with Resolution nº7/2015 and that corporate acts must be executed by means of digital signature. The Resolution shall become effective fifteen days after its publication in the official gazette (October 28, 2020).

LATEST NEWS IN THE HYDROCARBON SECTOR

Decree N°783/20 – Deferral of Tax on Liquid Fuels

By means of Decree Nº783/2020 (the “Decree”), the Executive Branch defers until October 16, 2020 the increase of tax on liquid fuels determined by Decree Nº501/2018 regarding unleaded gasoline, raw gasoline and diesel. The Decree also suspends further revisions until December 1st, 2020.

Disposition N°173/20 – New Canon for Use and Exploitation of Public Waters in Neuquén

By means of Disposition Nº 173/2020, the Undersecretary of Water Resources of the Province of Neuquén, exceptionally sets forth the value for the use of public waters for the year 2020.

Resolution Nº 5/20 – New Price per Ton of Biodiesel

By means of Resolution Nº 5/2020, the Secretary of Energy sets at AR$48.533 the price per ton of biodiesel purchased for mandatory blending with diesel (under Law 26.093).

Resolution Nº 4/20 – New Price per Liter of Bioethanol

By means of Resolution Nº 4/2020, the Secretary of Energy sets at AR$32,789 the price per liter of bioethanol made from sugar cane and corn purchased for mandatory blending with petrol (under Law 26.093).

Resolution Nº 61/20 – New Category of Service Stations

By means of Resolution Nº61/2020, the Secretary of Energy incorporates into the "Liquid Fuel Stations, Self Consumption, Storage, Distributors and Traders of Fuels and Hydrocarbons in Bulk and Compressed Natural Gas Registry" any natural person or company which expends liquid natural gas (LNG) in stations or self-consumption. The Resolution adopts the regulation ISO 16924:2016 regarding LNG stations. The Resolution also sets forth that those who decide to provide LNG must register with the Under-Secretary of Hydrocarbons and comply with Resolution Nº1102/04 and hire an external service of safety audit on an annual basis, among other obligations regarding safety.

Please, do not hesitate to contact us in case you have any further questions or comments:

María Victoria Tiscornia
Senior Associate
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+54 11 4326-7777

Leandro Martin Orts
Senior Associate
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+54 11 4326-7777