HomeReportsBureau of Economic and Business Affairs2023 Investment Climate Statements...Argentina

# 					2023 Investment Climate Statements: Argentina			

 In this section										/

													EXECUTIVE SUMMARY											

                -  EXECUTIVE SUMMARY 
                -  1. Openness To, and Restrictions Upon, Foreign Investment                    -  Policies Towards Foreign Direct Investment 
                  -  Limits on Foreign Control and Right to Private Ownership and Establishment 
                  -  Other Investment Policy Reviews 
                  -  Business Facilitation  
                  -  Outward Investment 
                -  2. Bilateral Investment and Taxation Treaties 
                -  3. Legal Regime                    -  Transparency of the Regulatory System 
                  -  International Regulatory Considerations 
                  -  Legal System and Judicial Independence 
                  -  Laws and Regulations on Foreign Direct Investment 
                  -  Competition and Antitrust Laws 
                  -  Expropriation and Compensation 
                  -  Dispute Settlement                      -  ICSID Convention and New York Convention 
                    -  Investor-State Dispute Settlement 
                    -  International Commercial Arbitration and Foreign Courts 
                  -  Bankruptcy Regulations 
                -  4. Industrial Policies                    -  Investment Incentives 
                  -  Foreign Trade Zones/Free Ports/Trade Facilitation 
                  -  Performance and Data Localization Requirements 
                -  5. Protection of Property Rights                    -  Real Property 
                  -  Intellectual Property Rights 
                -  6. Financial Sector                    -  Capital Markets and Portfolio Investment 
                  -  Money and Banking System 
                  -  Foreign Exchange and Remittances                      -  Foreign Exchange 
                    -  Remittance Policies 
                  -  Sovereign Wealth Funds 
                -  7. State-Owned Enterprises                    -  Privatization Program 
                -  8. Responsible Business Conduct                    -  Additional Resources 
                  -  Climate Issues 
                -  9. Corruption                    -  Resources to Report Corruption 
                -  10. Political and Security Environment 
                -  11. Labor Policies and Practices 
                -  12. U.S. International Development Finance Corporation (DFC), and Other Investment Insurance or Development Finance Programs 
                -  13. Foreign Direct Investment Statistics 
                -  14. Contact for More Information 

## EXECUTIVE SUMMARY

Argentina presents investment and trade opportunities, particularly in agriculture, energy, health, infrastructure, information technology, and mining. However, economic uncertainty, interventionist policies, high inflation, and persistent economic stagnation have prevented the country from maximizing its potential.

The Government of Argentina identified its top economic priorities for 2022 as reaching an agreement with the IMF to renegotiate the 2018 Stand-By Arrangement, controlling inflation, and continuing the post-pandemic economic recovery. The government met some of these goals as Argentina finished 2022 with better-than-expected economic growth at 5.2 percent, but with high poverty (over 43 percent), high inflation at 95 percent (the highest rate in over 30 years), and mounting exchange rate pressure. On March 25, 2022, the IMF Executive Board approved an Extended Fund Facility (EFF) program for Argentina. The EFF contains quantitative targets for continued compliance with the program that include a reduction in the primary fiscal deficit, progress toward elimination of monetary financing of the deficit, and the accumulation of foreign reserves. Argentina has been able to meet the IMF program targets in the first four reviews despite its heterodox economic measures. However, meeting the targets has not helped to rebalance the economy or set it on a sustainable path. Macroeconomic imbalances persist, fueled by weak confidence, low policy credibility, high inflation, and uncertainty ahead of national elections in 2023.

In August 2022, in an effort to address the ongoing economic issues, President Fernandez combined the previous ministries of economy, productive development, and agriculture, along with the energy and mining secretariats, and relations with international financial institutions (IFIS) and bilateral and multilateral lenders into a more powerful Ministry of Economy. Former President of the Chamber of Deputies, Sergio Massa, assumed control of the expanded ministry.

Even as the pandemic receded and economic activity rebounded, the government cited increased poverty and high inflation as reasons to continue, and even expand, price controls, capital controls, and foreign trade controls. Agricultural and food exports such as beef, soy, and flour were frequent targets for government intervention. Beginning in May 2021, the government introduced bans and other limits on beef exports to address increasing domestic prices. The ongoing conflict in Ukraine disrupted some trade with Russia and higher natural gas prices negatively affected Argentina’s balance of payments due to the need to import natural gas for the austral winter. However, the conflict also opened new demand and higher prices for key Argentine agricultural exports.

The Argentine government offered preferential exchange rates to promote soy exports and eliminated export taxes for specific businesses and industries, including small and medium sized enterprises; auto and automotive parts exports over 2021 volumes; and information technology service exports from companies enrolled in the knowledge-based economy promotion regime. There were also investment promotion incentives in key export sectors such as agriculture, forestry, hydrocarbons, manufacturing, and mining.

The high cost of capital affected the level of investments in developing renewable energy projects, despite the potential for both wind and solar power. In an effort to expand production of oil and natural gas, the current administration provides benefits to the fossil fuel industry in an attempt to improve the cost-competitiveness of renewable energy technologies. The government has encouraged the use of biofuels and electric vehicles.

Both domestic and foreign companies frequently point to a high and unpredictable tax burden and rigid labor laws as obstacles to further investment in Argentina. In 2022, Argentina ranked 69 out of 132 countries evaluated in the Global Innovation Index, which is an indicator of a country’s ability to innovate, based on the premise that innovation is a driver of a nation’s economic growth and prosperity. In the latest Transparency International Corruption Perceptions Index (CPI), Argentina ranked 94 out of 180 countries in 2022, dropping 2 places compared to 2021.

As a Southern Common Market (MERCOSUR) member, Argentina signed a free trade and investment agreement with the European Union (EU) in June 2019. Argentina has not yet ratified the agreement. In 2022, Argentina and MERCOSUR concluded negotiations with Singapore. During 2022, there was little progress with ongoing trade negotiations with South Korea, Canada, and Indonesia. Argentina ratified the WTO Trade Facilitation Agreement on January 22, 2018. Argentina and the United States continue to expand bilateral commercial and economic cooperation to improve and facilitate public-private ties and communication on trade, investment, energy, and infrastructure issues, including market access and intellectual property rights. More than 265 U.S. companies operate in Argentina, and the United States continues to be the top investor in Argentina with more than USD $12.5 billion (stock) of foreign direct investment as of 2021

 

							1. Openness To, and Restrictions Upon, Foreign Investment					

### Policies Towards Foreign Direct Investment

The Ministry of Foreign Affairs, International Trade, and Worship is the lead governmental entity for investment promotion.  The Fernandez administration does not have a formal business roundtable or other dialogue established with international investors, although it does engage frequently with domestic and international companies.

Market regulations such as capital controls, trade restrictions, and price controls hinder the investment climate in Argentina.

Foreign and domestic investors generally compete under the same conditions in Argentina. However, foreign investment is prohibited in specific sectors such as aviation and media. Foreign ownership of rural productive lands, bodies of water, and areas along borders is also restricted.

Argentina has a National Investment and Trade Promotion Agency that provides information and consultation services to investors and traders on economic and financial conditions, investment opportunities, and Argentine laws and regulations. The agency also helps small and medium- sized companies (SMEs) export their products, provides matchmaking services, and organizes roadshows and trade delegations. In 2019, the government placed the Agency under the direction of the Ministry of Foreign Affairs (MFA) to improve coordination between the Agency and Argentina ́s foreign policy. The Under Secretary for Trade and Investment Promotion of the MFA works as a liaison between the Agency and provincial governments and regional organizations. The administration also created the National Directorate for Investment Promotion (NDIP) under the Under Secretary for Trade and Investment Promotion, making the Directorate responsible for promoting Argentina as an investment destination. The Directorate determined priority sectors and projects in agriculture, mining, energy, industry, health, technology, and tourism. Its mission includes helping Argentine companies expand internationally and/or attract international investment.

The agency’s web portal provides information on available services (https://www.inversionycomercio.org.ar/). The 23 provinces and the City of Buenos Aires also have their own provincial investment and trade promotion offices.

### Limits on Foreign Control and Right to Private Ownership and Establishment

There have been no significant changes since the last ICS. Foreign and domestic commercial entities in Argentina are regulated by the Commercial Partnerships Law (Law 19,550), the Argentina Civil and Commercial Code, and rules issued by the regulatory agencies. Foreign private entities can establish and own business enterprises and engage in all forms of remunerative activity in nearly all sectors.

Full foreign equity ownership of Argentine businesses is not restricted, for the most part, with exceptions in the air transportation and media industries. The share of foreign capital in companies that provide commercial passenger transportation within the Argentine territory is limited to 49 percent per the Aeronautic Code Law 17,285. The company must be incorporated according to Argentine law and domiciled in Buenos Aires. In the media sector, Law 25,750 limits foreign ownership in television, radio, newspapers, journals, magazines, and publishing companies to 30 percent.

Law 26,737 (Regime for Protection of National Domain over Ownership, Possession or Tenure of Rural Land) establishes that a foreigner cannot own land that allows for the extension of existing bodies of water or that are located near a Border Security Zone. In February 2012, the government issued Decree 274/2012 further restricting foreign land ownership to a maximum of 30 percent of national land and 15 percent of productive land. Foreign individual or foreign company ownership is limited to 1,000 hectares (2,470 acres) in the most productive farming areas. In June 2016, the Government of Argentina issued Decree 820 easing the requirements for foreign land ownership by changing the percentage that defines foreign ownership of a person or company, raising it from**25 percent to 51 percent of the social capital of a legal entity. Waivers are not available.

Argentina does not maintain an investment screening mechanism for inbound foreign investment. U.S. investors are not at a disadvantage to other foreign investors or singled out for discriminatory treatment.

### Other Investment Policy Reviews

Argentina was last subject to an investment policy review by the OECD in 1997 and the fifth trade policy review by the WTO in September 2021 (https://www.wto.org/english/tratop_e/tpr_e/tp512_e.htm). The United Nations Conference on Trade and Development (UNCTAD) has not done an investment policy review of Argentina.

In 2019, automotive sector representatives, including the Association of Automobile Manufacturers (ADEFA, or Asociación de Fábricas de Automotores) and the Asociación of Auto Parts Manufacturers (AFAC, or Asociación de Fábricas Argentinas de Componentes), published Plan 2030, a strategic plan for investment and development in the automotive sector (https://www.acara.org.ar/download/socios/A01V02-0919%20(7).pdf).

In 2022, the Industrial Union of Argentina (UIA, or Unión Industrial Argentina) published a White Book of recommendations to promote development and increase productivity in Argentina (https://www.uia.org.ar/general/3889/propuestas-para-un-desarrollo-productivo-federal-sustentable-e-inclusivo-libro-blanco/).The Rosario Board of Trade (BCR, or Bolsa de Comercio de Rosario) published regular reports and recommendations for agricultural trade and investment policies. (https://www.bcr.com.ar/es). In 2022, the Argentine Agroindustrial Council (CAA or, Consejo Agroindustrial Argentino) published its Federal Agroindustrial Plan 2023/2033, outlining recommendations for agroindustrial development (http://consejoagroindustrialargentino.org.ar/plan-federal-agroindustrial-2023-2033/ ).

### Business Facilitation 

In 2019, stemming from the country’s deteriorating financial and economic situation, the Argentine government re-imposed capital controls on businesses and consumers, limiting their access to foreign exchange.  The government updated and expanded capital controls, export taxes, and limits on imports throughout 2022, generating continued uncertainty in the business climate.

Trying to control headline inflation that reached 94.8 percent in 2022, the government increased market interventions, creating further market distortions that may deter investment. Argentina currently has a consumer goods price control program, *“**Precios****Justos**,**”* replacing the former “*Precios****Cuidados**”* program, a voluntary program established in November 2022 which includes products such as food, beverages, dairy products, personal hygiene, and cleaning. The prices of around 2,000 products are frozen, while another 50,000 products are subject to caps on price increases. During 2022, the health and energy sectors were also subject to limits on price increases under different voluntary agreements.

In 2020, the Argentine Congress passed the Shelves Law (No. 27,545), which regulates the supply, display, and distribution of products on supermarket shelves and virtual stores. Key articles of the Law are still pending implementing regulations. Private companies expressed concern over the final regulatory framework of the Law, which could affect their production, distribution, and marketing business models.

In August 2020, the government issued a decree freezing tariffs for telecommunication services (mobile and land), cable and satellite TV, and internet services until December 2020, later extending the measure.  Some telecommunication companies appealed through the courts and were granted partial protection from the decree. As a result, the companies have been able to increase tariffs, but the decree remains in effect, which is a continued source of uncertainty for the sector.

In March 2021, the Secretary of Domestic Trade issued Resolution 237/2021 establishing a national registry to monitor the production levels, distribution, and sales of private companies. If companies fail to comply, they could be subject to fines or closure. Although this law remains on the books, it has not been used by the government. The Ministry of Economy eased bureaucratic hurdles for foreign trade through the creation of a Single Window for Foreign Trade (“VUCE” for its Spanish acronym) in 2016. The VUCE centralizes the administration of all required paperwork for the import, export, and transit of goods (e.g., certificates, permits, licenses, and other authorizations and documents). However, the Argentine government has not fully implemented the VUCE. Tighter import controls imposed by the Fernandez administration have affected the business plans of private companies that need imported inputs for production. The private sector claimed there was increased discretion on the part of trade authorities responsible for both approving import licenses and obtaining access to the foreign exchange market to pay for imports.

In 2022, a key part of the government’s strategy to address foreign exchange shortages caused by higher energy import prices was to limit imports and tighten capital controls. On October 17, 2022, the government launched a new import licensing and tracking system known as SIRA (Sistema de Importación de la República Argentina) to replace the previous system known as SIMI (Sistema Integral de Monitoreo de Importaciones). The government claimed that the new system would provide more certainty and transparency, however industry groups have raised concerns about increased delays and perceived discretionary decision making on the part of authorities. During 2022, the number of non-automatic import licenses increased from 15 to 41 percent of total tariff lines. Approximately 4,100 of the 10,200 tariff lines are currently subject to non-automatic licensing. The new system includes verification that the importer’s request is consistent with its declared financial resources as well as other controls detailed in this link: https://www.afip.gob.ar/sira/operatoria/acceso-al-sistema.asp

Obtaining dollars from the Argentine Central Bank to pay for imports was also difficult for companies due to tightening capital controls to preserve rapidly dwindling foreign reserves by limiting importers’ access to hard currency (such as U.S. dollars) to pay for imports.

The Argentine Congress approved an Entrepreneurs’ Law in March 2017, which allows for the creation of a simplified joint-stock company (SAS, or Sociedad por Acciones Simplificada) online within 24 hours of registration. However, in March 2020, the Fernandez administration annulled the 24-hour registration system. Industry groups said this hindered the entrepreneurship ecosystem by revoking one of the pillars of the Entrepreneurs’ Law.

In December 2020, the government issued the regulatory framework for the Knowledge Based-Economy Law, which was passed in October 2020. The Law establishes tax benefits for entrepreneurs until December 2029. The complete list of activities included in the tax benefit can be found at: http://servicios.infoleg.gob.ar/infolegInternet/verNorma.do;jsessionid=56625A2FC5152F34ECE583158D581896?id=346218.

Foreign investors seeking to set up business operations in Argentina follow the same procedures as domestic entities without prior approval and under the same conditions as local investors. To open a local branch of a foreign company in Argentina, the parent company must be legally registered in Argentina. Argentine law requires at least two equity holders, with the minority equity holder maintaining at least a five percent interest. In addition to the procedures required of a domestic company, a foreign company establishing itself in Argentina must legalize the parent company’s documents, register the incoming foreign capital with the Argentine Central Bank, and obtain a trading license.

A company must register its name with the Office of Corporations (IGJ, or Inspección General de Justicia). The IGJ website describes the registration process, and some portions can be completed online (https://www.argentina.gob.ar/justicia/igj/guia-de-tramites). Once the IGJ registers the company, the company must request that the College of Public Notaries submit the company’s accounting books to be certified with the IGJ. The company’s legal representative must obtain a tax identification number from AFIP, register for social security, and obtain blank receipts from another agency. Companies can register with AFIP online at www.afip.gob.ar or by submitting the sworn affidavit form No. 885 to AFIP.

Details on how to register a company can be found at the Ministry of Productive Development’s website: https://www.argentina.gob.ar/produccion/crear-una-empresa. Instructions on how to obtain a tax identification code can be found at: https://www.argentina.gob.ar/obtener-el-cuit-por-internet.

The enterprise must also provide workers’ compensation insurance for its employees through the Workers’ Compensation Agency (ART, or Aseguradora de Riesgos del Trabajo). The company must register and certify its accounting of wages and salaries with the Secretariat of Labor, within the Ministry of Labor, Employment, and Social Security.

The Ministry of Productive Development offers attendance-based courses and online training for businesses. The training menu can be viewed at: https://www.argentina.gob.ar/produccion/capacitacion.

### Outward Investment

Argentina does not promote outward investment. There are no legal restrictions on foreign investment, either on the investor or on the destination of the investment.

							2. Bilateral Investment and Taxation Treaties					

Argentina has a Bilateral Investment Treaty (BIT) with the United States, which entered into force on October 20, 1994. The text of the Argentina-United States BIT is available at: http://2001-2009.state.gov/documents/organization/43475.pdf.

As of December 2022, Argentina has 48 BITs in force. Argentina has signed treaties that are not yet in force with six other countries: Greece (October 1999), New Zealand (August 1999), the Dominican Republic (March 2001), Qatar (November 2016), United Arab Emirates (April 2018), and Japan (December 2018).

During 2022, Argentina continued discussions to strengthen bilateral commercial, economic, and investment cooperation with several countries, including China, Russia, Japan, Spain, and the United States. Argentina and the United States established a bilateral Commercial Dialogue and a Trade and Investment Framework Agreement (TIFA) in 2016. Bilateral talks are ongoing through both mechanisms. Argentina does not have a Free Trade Agreement with the United States.

Argentina is a founding member of the Southern Common Market (MERCOSUR), which includes Brazil, Paraguay, Uruguay, and Venezuela (currently suspended). Through MERCOSUR, Argentina has signed Free Trade Agreements (FTA) with Egypt and Israel. MERCOSUR has Trade Framework Agreements with Morocco and Mexico, and Preferential Trade Agreements (PTA) with the Southern African Customs Union (SACU), India, Colombia, Chile, Mexico, and Ecuador.

In 2019, MERCOSUR signed an FTA with the European Union and another one with the European Free Trade Association (EFTA). However, Argentina has not ratified either agreement. In 2022, MERCOSUR and Singapore concluded negotiations on an FTA agreement which is now pending ratification. There are still ongoing trade liberalization talks with South Korea, Canada, Indonesia, and other partners.

Argentina has Economic Complementarity Agreements with Bolivia, Colombia, Ecuador, Mexico, Peru, and Chile that predate MERCOSUR and are therefore grandfathered into MERCOSUR. Argentina also has an Economic Association Agreement with Colombia signed in 2017. In 2019, the expanded Economic Complementation Agreement (ECA) between Chile and Argentina entered into effect. This agreement includes trade facilitation regulations and development programs directed to support SMEs, and adds chapters on e-commerce, trade in services, and government procurement. In 2019, Argentina also agreed to new provisions for automotive trade agreements with Brazil, Mexico and Paraguay. In the case of Mexico and Brazil, the zeroing of tariffs had been scheduled for 2019 and 2020, but was postponed to 2025 and 2029, respectively.

Argentina does not have a bilateral taxation treaty with the United States. In December 2016, Argentina signed a Tax Information Exchange Agreement (TIEA) with the United States, which increases the transparency of commercial transactions between the two countries to aid with combating tax and customs fraud. The Agreement entered into force on November 13, 2017. On December 5, 2022, the United States and Argentina signed an Intergovernmental Agreement (IGA) to facilitate implementation of the Foreign Account Tax Compliance Act (FATCA) which entered into force on January 1, 2023.

Since 1982, Argentina has participated in the substantive work of many of the OECD’s specialized committees. Argentina is a member of the OECD Inclusive Framework on Base Erosion and Profit Shifting and is a party to the Inclusive Framework’s October 2021 deal on the two-pillar solution to global tax challenges, including a global minimum corporate tax. Argentina is also part of the Principles of Corporate Governance which are international standard for corporate governance. On January 25, 2022, the OECD Council decided to invite Argentina to begin the accession process, but the Government of Argentina has not moved forward with that invitation.

In 2014, Argentina committed to implementing the OECD single global standard on automatic exchange of financial information.  In June 2018, AFIP and the OECD signed an MOU to establish the first Latin American Financial and Fiscal Crime Investigation Academy.

Argentina has signed 26 double taxation treaties, including with Germany, Canada, Russia, Switzerland, France, and the United Kingdom but only 21 of them are currently in force. In July 2017, Argentina updated a prior agreement with Brazil, which took effect in July 2018. Argentina also has customs agreements and cooperation treaties with numerous countries. A full listing is available at: https://www.afip.gob.ar/convenios-internacionales/materia/convenios-para-evitar-la-doble-imposicion.asp#tab-1.

In general, national taxation rules do not discriminate against foreigners or foreign firms (e.g., asset taxes are applied to equity possessed by both domestic and foreign entities).

							3. Legal Regime					

### Transparency of the Regulatory System

The Secretary of Strategic Affairs under the Cabinet is in charge of transparency policies and the digitalization of bureaucratic processes as of December 2019.

Argentine government authorities and a number of quasi-independent regulatory entities can issue regulations and norms within their mandates. There are no informal regulatory processes managed by non-governmental organizations or private sector associations. Rulemaking has traditionally been a top-down process in Argentina, unlike in the United States where industry organizations often lead in the development of standards and technical regulations.  The Constitution establishes a procedure that allows for citizens to draft or propose legislation, which is subject to Congressional and Executive approval before being passed into law.

Ministries, regulatory agencies, and Congress are not obligated to provide a list of anticipated regulatory changes or proposals, share draft regulations with the public, or establish a timeline for public comment. They are also not required to conduct impact assessments of the proposed legislation and regulations.

All final texts of laws, regulations, resolutions, dispositions, and administrative decisions must be published in the Official Gazette (https://www.boletinoficial.gob.ar), as well as in the newspapers and the websites of the Ministries and agencies. These texts can also be accessed through the official website Infoleg (http://www.infoleg.gob.ar/), overseen by the Ministry of Justice and Human Rights. Interested stakeholders can pursue judicial review of regulatory decisions.

In September 2016, Argentina enacted a Right to Access Public Information Law (27,275) that mandates all three governmental branches (legislative, judicial, and executive), political parties, universities, and unions that receive public funding are to provide non-classified information at the request of any citizen. The law also created the Agency for the Right to Access Public Information to oversee compliance.

During 2018, the government introduced new procurement standards including electronic procurement, formalization of procedures for costing-out projects, and transparent processes to renegotiate debts to suppliers. The government also introduced OECD recommendations on corporate governance for state-owned enterprises to promote transparency and accountability during the procurement process. In 2022, Resolution 206/2022 established best practices for the internal controls of these companies. The main regulation may be viewed at:http://servicios.infoleg.gob.ar/infolegInternet/verNorma.do?id=306769.

In November 2017, Argentina passed the Business Criminal Responsibility Law (27,041) and internalized it through the Decree 277/2018. This decree establishes an Anti-Corruption Office in charge of outlining and monitoring the transparency policies with which companies must comply to be eligible for public procurement.

The Argentine government has sought to increase public consultation in the rulemaking process; however, public consultation is non-binding and has been done in an ad-hoc fashion. In 2017, the Government of Argentina issued a series of legal instruments that seek to promote the use of tools to improve the quality of the regulatory framework. Amongst them, Decree 891/2017 for Good Practices in Simplification establishes a series of tools to improve the rulemaking process. The decree introduces tools on ex-ante and ex-post evaluation of regulation, stakeholder engagement, and administrative simplification, amongst others. Nevertheless, no formal oversight mechanism has been established to supervise the use of these tools across the line of ministries and government agencies.

Some ministries and agencies developed their own processes for public consultation by publishing drafts on their websites, directly distributing the draft to interested stakeholders for feedback, or holding public hearings.

In November 2017, the Government of Argentina launched a new website to communicate how the government spends public funds in a user-friendly format (https://www.argentina.gob.ar/economia/transparencia/presupuesto).

The Argentine government also made an effort to improve citizens’ understanding of the budget, through the citizen’s budget “Presupuesto Ciudadano” website: https://www.economia.gob.ar/onp/presupuesto_ciudadano/seccion6.php. The initiative aligns with the Global Initiative for Fiscal Transparency (GIFT) and UN Resolution 67/218 on promoting transparency, participation, and accountability in fiscal policy.

Argentina requires public companies to adhere to International Financial Reporting Standards (IFRS). Argentina is a member of UNCTAD’s international network of transparent investment procedures.

The government of Argentina does not promote or require environmental, social, and governance (ESG) disclosures to facilitate transparency and/or help investors and consumers distinguish between high and low-quality investments.

### International Regulatory Considerations

Argentina is a founding member of MERCOSUR and has been a member of the Latin American Integration Association (ALADI for Asociación Latinoamericana de Integración) since 1980.  Once any of the decision-making bodies within MERCOSUR agrees to apply a particular regulation, each of the member countries must incorporate it into its legislation according to its own legislative procedures. Once a regulation has been incorporated in a MERCOSUR member’s legislation, the country must notify the MERCOSUR headquarters.

Argentina has been a member of the WTO since 1995, and it ratified the Trade Facilitation Agreement in January 2018. Argentina notifies technical regulations, but not proposed drafts, to the WTO Committee on Technical Barriers to Trade.  Argentina submitted itself to an OECD regulatory policy review in March 2018, which was released in March 2019.  On January 1, 2022, the OECD decided to open accession discussions with Argentina for OECD membership. Argentina participates in all 23 OECD committees.  The Fernandez administration has not actively pursued OECD accession.

Additionally, the Argentine Institute for Standards and Certifications (IRAM) is a member of international and regional standards bodies including the International Standardization Organization (ISO), the International Electrotechnical Commission (IEC), the Pan-American Commission on Technical Standards (COPAM), the MERCOSUR Association of Standardization (AMN), the International Certification Network (i-Qnet), the System of Conformity Assessment for Electrotechnical Equipment and Components (IECEE), and the Global Good Agricultural Practice network (GLOBALG.A.P.).

### Legal System and Judicial Independence

Argentina follows a Civil Law system. In 2014, the Argentine government passed a new Civil and Commercial Code that has been in effect since August 2015. The Civil and Commercial Code provides regulations for civil and commercial liability, including ownership of real and intangible property claims. The current judicial process is lengthy and has significant backlogs. In the Argentine legal system, appeals may be brought from many rulings of the lower courts, including evidentiary decisions, not just final orders, which significantly slows all aspects of the system. The Justice Ministry reported in December 2018 that the expanded use of oral processes had reduced the duration of 68 percent of all civil matters to less than two years.

According to the Argentine constitution, the judiciary is a separate and equal branch of government. In practice, there are continuous instances of political interference in the judicial process. Companies have complained that courts lack transparency and reliability, and that the Argentine government has used the judicial system to pressure the private sector. Media revelations of judicial impropriety and corruption feed public perception and undermine confidence in the judiciary.

Many foreign investors prefer to rely on private or international arbitration when those options are available. Claims regarding labor practices are processed through a labor court, regulated by Law 18,345 and its subsequent amendments, and implementing regulations by Decree 106/98. Contracts often include clauses designating specific judicial or arbitral recourse for dispute settlement.

### Laws and Regulations on Foreign Direct Investment

According to the Foreign Direct Investment Law 21,382 and Decree 1853/93, foreign investors may invest in Argentina without prior governmental approval, under the same conditions as investors domiciled within the country. Foreign investors are free to enter into mergers, acquisitions, greenfield investments, or joint ventures. Foreign firms may also participate in publicly financed research and development programs on a national treatment basis. Incoming foreign currency must be identified by the participating bank to the Central Bank of Argentina (www.bcra.gob.ar).

All foreign and domestic commercial entities in Argentina are regulated by the Commercial Partnerships Law (Law No. 19,550) and the rules issued by the commercial regulatory agencies. Decree 27/2018 amended Law 19,550 to eliminate regulatory barriers and reduce bureaucratic burdens, expedite and simplify processes in the public domain, and deploy existing technological tools to better focus on transparency. Full text of the decree can be found at: http://servicios.infoleg.gob.ar/infolegInternet/anexos/305000-309999/305736/norma.htm. All other laws and norms concerning commercial entities are established in the Argentina Civil and Commercial Code, which can be found at: http://servicios.infoleg.gob.ar/infolegInternet/anexos/235000-239999/235975/norma.htm

Further information about Argentina’s investment policies can be found at the following websites:Secretary of Industry and Productive Development (https://www.argentina.gob.ar/produccion)Ministry of Economy (https://www.argentina.gob.ar/economia)The Central Bank of the Argentine Republic (http://www.bcra.gob.ar/)The National Securities Exchange Commission (https://www.argentina.gob.ar/cnv)The National Investment and Trade Promotion Agency (https://www.inversionycomercio.org.ar/)Investors can download Argentina’s investor guide through this link: https://www.investargentina.org.ar/

### Competition and Antitrust Laws

The National Commission for the Defense of Competition and the Secretariat of Trade, both within the Ministry of Economy, have enforcement authority of the Competition Law (Law 25,156). The law aims to promote a culture of competition in all sectors of the national economy. In May 2018, the Argentine Congress approved a Defense of Competition Law (Law 27,442), which would have, among other things, established an independent competition agency and tribunal. The law incorporates anti-competitive conduct regulations and a leniency program to facilitate cartel investigation. The full text of the law can be viewed at: http://servicios.infoleg.gob.ar/infolegInternet/verNorma.do?id=310241.

The Ministry of Economy, through Resolution No. 68/2022, requested the National Commission for the Defense of Competition to initiate proceedings for alleged anticompetitive practices through abuse of dominant market position under Law No. 27,442 against companies involved in the production and commercialization of mass consumer products that increased prices during 2022.

In September 2014, Argentina amended the 1974 National Supply Law to expand the ability of the government to regulate private enterprises by setting minimum and maximum prices and profit margins for goods and services at any stage of economic activity. Private companies may be subject to fines and temporary closure if the government determines they are not complying with the law. Although the law is still in effect, the U.S. Government has not received any reports of it being applied since December 2015.  However, the Fernandez administration has expressed its potential use when companies resisted compliance with price control programs, even if the program was supposed to be voluntary.In March 2020, the Government of Argentina enacted the Supermarket Shelves Law (Law 27,545) that states that any single manufacturer and its associated brands cannot occupy more than 30 percent of a retailer’s shelf space devoted to any one product category.  The law’s proponents claim it will allow more space for domestic SME-produced products, encourage competition, and reduce shortages. In 2021, several resolutions established regulations regarding the allocation of shelf space for virtual retailers. U.S. companies have expressed concern over the pending regulations, seeking clarification about issues such as whether display space percentages would be considered per brand or per production company, as it could potentially affect a company’s production, distribution, and marketing business model.

### Expropriation and Compensation

Section 17 of the Argentine Constitution affirms the right of private property and states that any expropriation must be authorized by law and compensation must be provided. The United States-Argentina BIT states that investments shall not be expropriated or nationalized except for public purposes upon prompt payment of the fair market value in compensation.

### Dispute Settlement

#### ICSID Convention and New York Convention

Argentina is a signatory to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitration Awards, which the country ratified in 1989. Argentina is also a party to the International Center for Settlement of Investment Disputes (ICSID) Convention since 1994.

There is neither specific domestic legislation providing for enforcement under the 1958 New York Convention nor legislation for the enforcement of awards under the ICSID Convention. Companies that seek recourse through Argentine courts may not simultaneously pursue recourse through international arbitration.

#### Investor-State Dispute Settlement

The Argentine government officially accepts the principle of international arbitration. The United States-Argentina BIT includes a chapter on Investor-State Dispute Settlement for U.S. investors.

In the past ten years, Argentina has been brought before the ICSID in 7 cases involving U.S. or other foreign investors. Argentina currently has six pending arbitration cases, two of them filed against it by U.S. investors. For more information on the cases brought by U.S. claimants against Argentina, go to: https://icsid.worldbank.org/en/Pages/cases/AdvancedSearch.aspx#.

Local courts cannot enforce arbitral awards issued against the government based on the public policy clause. There is no history of extrajudicial action against foreign investors.

Argentina is a member of the United Nations Commission on International Trade Law (UNCITRAL) and the World Bank’s Multilateral Investment Guarantee Agency (MIGA).

Argentina is also a party to several bilateral and multilateral treaties and conventions for the enforcement and recognition of foreign judgments, which provide requirements for the enforcement of foreign judgments in Argentina, including:

Treaty of International Procedural Law, approved in the South American Congress of Private International Law held in Montevideo in 1898, ratified by Argentina by law No. 3,192.

Treaty of International Procedural Law, approved in the South American Congress of Private International Law held in Montevideo in 1939-1940, ratified by Dec. Ley 7771/56 (1956).

Panama Convention of 1975, CIDIP I: Inter-American Convention on International Commercial Arbitration, adopted within the Private International Law Conferences – Organization of American States, ratified by law No. 24,322 (1995).

Montevideo Convention of 1979, CIDIP II: Inter-American Convention on Extraterritorial Validity of Foreign Judgments and Arbitral Awards, adopted within the Private International Law Conferences – Organization of American States, ratified by law No. 22,921 (1983).

#### International Commercial Arbitration and Foreign Courts

Alternative dispute resolution (ADR) mechanisms can be stipulated in contracts. Argentina also has ADR mechanisms available such as the Center for Mediation and Arbitrage (CEMARC) of the Argentine Chamber of Trade. More information can be found at: http://www.intracen.org.

Argentina does not have a specific law governing arbitration, but it has adopted a mediation law (Law 24.573/1995), which makes mediation mandatory prior to litigation. Some arbitration provisions are scattered throughout the Civil Code, the National Code of Civil and Commercial Procedure, the Commercial Code, and three other laws. The following methods of concluding an arbitration agreement are non-binding under Argentine law: electronic communication, fax, oral agreement, and conduct on the part of one party. Generally, all commercial matters are subject to arbitration. There are no legal restrictions on the identity and professional qualifications of arbitrators. Parties must be represented in arbitration proceedings in Argentina by attorneys who are licensed to practice locally. The grounds for annulment of arbitration awards are limited to substantial procedural violations, an ultra petita award (award outside the scope of the arbitration agreement), an award rendered after the agreed-upon time limit, and a public order violation that is not yet settled by jurisprudence when related to the merits of the award. On average, it takes around 21 weeks to enforce an arbitration award rendered in Argentina, from filing an application to a writ of execution attaching assets (assuming there is no appeal). It takes roughly 18 weeks to enforce a foreign award. The requirements for the enforcement of foreign judgments are set out in section 517 of the National Procedural Code.

No information is available as to whether the domestic courts frequently rule in cases in favor of state-owned enterprises (SOE) when SOEs are party to a dispute.

### Bankruptcy Regulations

**Argentina’s bankruptcy law was codified in 1995 in Law 24,522. The full text can be found at: http://www.infoleg.gov.ar/infolegInternet/anexos/25000-29999/25379/texact.htm.**Under the law, debtors are generally able to begin insolvency proceedings when they are no longer able to pay their debts as they mature. Debtors may file for both liquidation and reorganization. Creditors may file for insolvency of the debtor for liquidation only. The insolvency framework does not require approval by the creditors for the selection or appointment of the insolvency representative or for the sale of substantial assets of the debtor. The insolvency framework does not provide rights to the creditor to request information from the insolvency representative, but the creditor has the right to object to decisions by the debtor to accept or reject creditors’ claims. Bankruptcy is not criminalized; however, convictions for fraudulent bankruptcy can carry two to six years of prison time.

Financial institutions regulated by the Central Bank of Argentina (BCRA) publish monthly outstanding credit balances of their debtors; the BCRA National Center of Debtors (Central de Deudores) compiles and publishes this information. The database is available for use of financial institutions that comply with legal requirements concerning protection of personal data. The credit monitoring system only includes negative information, and the information remains on file through the person’s life.

							4. Industrial Policies					

### Investment Incentives

Government incentives do not make any distinction between foreign and domestic investors.

The Argentine government offers several investment promotion programs at the federal, provincial, and municipal levels to attract investments to specific sectors of the economy such as capital goods and infrastructure, innovation and technological development, and energy, without discrimination between national and foreign-owned companies. Some of the investment promotion programs require investment in a specific region or locality, industry, or economic activity. Some programs offer value-added tax (VAT) refunds or other tax incentives for local production of capital goods. The Investment and International Trade Promotion Agency provides free evaluation and information to investors to facilitate operations in the country. Argentina’s investment promotion programs and regimes can be found at: https://www.inversionycomercio.ar/invertirArgentina, and https://www.argentina.gob.ar/produccion.

The Secretary of Industry offers micro, small, and medium enterprises (MSME) a low- cost credit program for investment projects, labor, capital, and energy efficiency improvement with no distinction between national or foreign-owned enterprises. The Secretary of Industry also offers grants, called “non-reimbursable contribution” to finance productive transformation or export projects for MSME covering a maximum of 80% of these projects.

More information can be found at: https://www.argentina.gob.ar/produccion/financiamiento

The Ministry of Productive Development supports employment training programs that are frequently free to the participants and do not differentiate based on nationality.

### Foreign Trade Zones/Free Ports/Trade Facilitation

Argentina has two types of tax-exempt trading areas: Free Trade Zones (FTZ), which are located throughout the country, and the more comprehensive Special Customs Area (SCA), which covers the entire province of Tierra del Fuego Province and is scheduled to expire at the end of 2038 after being extended for 15 years in 2021 by Decree 727.

Argentine law defines a FTZ as a territory outside the “general customs area” (GCA, i.e., the rest of Argentina) where neither the inflows nor outflows of exported final merchandise are subject to tariffs, non-tariff barriers, or other taxes on goods. Goods produced within a FTZ generally cannot be shipped to the GCA unless they are capital goods not produced in the rest of the country. The labor, sanitary, ecological, safety, criminal, and financial regulations within FTZs are the same as those that prevail in the GCA. Foreign firms receive national treatment in FTZs.

Merchandise shipped from the GCA to a FTZ may receive export incentive benefits, if applicable, only after the goods are exported from the FTZ to a third country destination. Merchandise shipped from the GCA to a FTZ and later exported to another country is not exempt from export taxes. Any value added in a FTZ or re-export from a FTZ is exempt from export taxes. For more information on FTZ in Argentina see: http://www.afip.gob.ar/zonasFrancas/.

Products manufactured in the SCA may enter the GCA free from taxes or tariffs. In addition, the government may enact special regulations that exempt products shipped through the SCA (but not manufactured therein) from all forms of taxation except excise taxes. The SCA program provides benefits for established companies that meet specific production and employment objectives.

### Performance and Data Localization Requirements

The Argentine national government does not have local employment mandates, nor does it apply such schemes to senior management or boards of directors. However, certain provincial governments do require employers to hire a certain percentage of their workforce from the provincial population. There are no excessively onerous visa, residence, work permit, or similar requirements inhibiting mobility of foreign investors and their employees. Under Argentine law, conditions to invest are equal for national and foreign investors. As of March 2018, citizens of MERCOSUR countries can obtain legal residence within five months at little cost, which grants permission to work. Argentina suspended its method for expediting this process in early 2018.

Argentina has local content requirements for specific sectors. Requirements are applicable to domestic and foreign investors equally. Argentine law establishes a national preference for local industry for most government procurement if the domestic supplier’s tender is no more than five to seven percent higher than the foreign tender. The amount by which the domestic bid may exceed a foreign bid depends on the size of the domestic company making the bid. In May 2018, Argentina issued Law 27,437, giving additional priority to Argentine small and medium-sized enterprises and, separately, requiring that foreign companies that win a tender must subcontract domestic companies to cover 20 percent of the value of the work. The preference applies to procurement by all government agencies, public utilities, and concessionaires.  There is similar legislation at the sub-national (provincial) level.

In November 2016, the government passed a public-private partnership (PPP) law (27,328) that regulates public-private contracts. The law lowered regulatory barriers to foreign investment in public infrastructure projects with the aim of attracting more foreign direct investment. Several projects under the PPP initiative have been canceled or put on hold due to an ongoing investigation on corruption in public works projects during the last administration. The PPP law contains a “Buy Argentina” clause that mandates at least 33 percent local content for every public project.

Argentina is not a signatory to the WTO Agreement on Government Procurement (GPA), but it became an observer to the GPA in February 1997.

In July 2016, the Ministry of Production and Labor and the Ministry of Energy and Mining issued Joint Resolutions 123 and 313, which allow companies to obtain tax benefits on purchases of solar or wind energy equipment for use in investment projects that incorporate at least 60 percent local content in their electromechanical installations.  In cases where local supply is insufficient to reach the 60 percent threshold, the threshold can be reduced to 30 percent.  The resolutions also provide tax exemptions for imports of capital and intermediate goods that are not locally produced for use in the investment projects.

In 2022, Argentina passed the law 27,686 to promote investments in the automotive and auto parts industry and its value chain with benefits in VAT, income tax and export duties reductions. This law also created an Institute for Mobility, composed of the GOA, labor unions, and scientific and technological institutions.

Passed in 2016, Law 27,263 remains in effect and already provided tax credits to automotive manufacturers for the purchase of locally produced automotive parts and accessories incorporated into specific types of vehicles. The tax credits ranged from 4 percent to 15 percent of the value of the purchased parts.  The list of vehicle types included in the regime can be found here: http://servicios.infoleg.gob.ar/infolegInternet/anexos/260000-264999/263955/norma.htm.

The Resolution 28/2018 simplified the procedure for obtaining these tax credits by dropping the national content below the minimum required in 2016. Exchange rate fluctuations, inflation, and other macroeconomic concerns have been considered by the GOA to meet the regime’s requirements so that the automotive manufacturers will not be considered non-compliant.

The Media Law, enacted in 2009 and amended in 2015, requires companies to produce advertising and publicity materials locally or to include 60 percent local content. The Media Law also establishes a 70 percent local production content requirement for companies with radio licenses. Additionally, the Media Law requires that 50 percent of the news and 30 percent of the music that is broadcast on the radio be of Argentine origin. In the case of private television operators, at least 60 percent of broadcast content must be of Argentine origin. Of that 60 percent, 30 percent must be local news and 10 to 30 percent must be local independent content.

Argentina establishes percentages of local content in the production process for manufacturers of mobile and cellular radio communication equipment operating in Tierra del Fuego province.  Resolution 66/2018 maintains the local content requirement for products such as technical manuals, packaging, and labeling. The percentage of local content required ranges from 10 percent to 100 percent depending on the process or item. In cases where local supply is insufficient to meet local content requirements, companies may apply for an exemption that is subject to review every six months. A detailed description of local content percentage requirements can be found at: http://servicios.infoleg.gob.ar/infolegInternet/verNorma.do;jsessionid=0CA1B74C2D7EC353E66F1CC6CFD8B41D?id=255494.

There are no requirements for foreign IT providers to turn over source code and/or provide access to encryption, nor does the government prevent companies from freely transmitting customer or other business-related data outside the country’s territory.

Argentina does not have forced localization of content in technology or requirements of data storage in country.

There is no discrimination between domestic and foreign investors in investment incentives. There are no performance requirements. A complete guide of incentives for investors in Argentina can be found at: https://img.inversionycomercio.org.ar/pdf/Guia-para-el-inversor.pdf

							5. Protection of Property Rights					

### Real Property

Secured interests in property, including mortgages, are recognized in Argentina. Such interests can be easily and effectively registered. They also can be readily bought and sold. Argentina manages a national registry of real estate ownership (Registro de la Propiedad Inmueble) at http://www.dnrpi.jus.gov.ar/. No data is available on the percent of all land that does not have clear title. There are no specific regulations regarding land lease and acquisition of residential and commercial real estate by foreign investors. Law 26,737 (Regime for Protection of National Domain over Ownership, Possession or Tenure of Rural Land) establishes the restrictions of foreign ownership on rural and productive lands, including water bodies. Foreign ownership is also restricted on land located near borders.

Legal claims may be brought to evict persons unlawfully occupying real property, even if the property is unoccupied by the lawful owner. However, these legal proceedings can be quite lengthy, and until the legal proceedings are complete, evicting squatters is problematic. The title and actual conditions of real property interests under consideration should be carefully reviewed before acquisition.

Argentine Law 26.160 prevents the eviction and confiscation of land traditionally occupied by indigenous communities in Argentina or encumbered with an indigenous land claim. Indigenous land claims can be found in the land registry. Enforcement is carried out by the National Institute of Indigenous Affairs, under the Ministry of Justice and Human Rights.

### Intellectual Property Rights

The U.S. Trade Representative (USTR)’s 2023 Special 301 Report listed Argentina on the Priority Watch List. Trading partners on the Priority Watch List present the most significant concerns regarding inadequate or ineffective IP protection or enforcement or actions that otherwise limit market access for persons relying on IP protection. For a complete version of the 2023 Report, see: https://ustr.gov/sites/default/files/2023-04/2023%20Special%20301%20Report.pdf

The Government of Argentina adheres to some treaties and international agreements on intellectual property (IP) and belongs to the World Intellectual Property Organization and the World Trade Organization. The Argentine Congress ratified the Uruguay Round agreements, including the provisions on intellectual property, in Law 24425 in 1995.

Argentina continues to present long-standing and well-known challenges to intellectual property (IP)-intensive industries, including those from the United States.  A key deficiency in the legal framework for patents is the unduly broad limitations on patent eligible subject matter.  Pursuant to the 2012 Joint Resolution establishing guidelines for the examination of patents, Argentina rejects patent applications for categories of pharmaceutical inventions that are eligible for patentability in other jurisdictions, including in the United States.  Additionally, to be patentable, Argentina requires that processes for the manufacture of active compounds disclosed in a specification be reproducible and applicable on an industrial scale.  Stakeholders assert that Resolution 283/2015, introduced in September 2015, also limits the ability to patent biotechnological innovations based on living matter and natural substances.  These measures have interfered with the ability of companies investing in Argentina to protect their IP and may be inconsistent with international norms.

Another ongoing challenge to the innovative agricultural chemical and pharmaceutical sectors is inadequate protection against the unfair commercial use, as well as unauthorized disclosure, of undisclosed test or other data generated to obtain marketing approval for products in those sectors.  Argentina made progress on eliminating the patent application backlog, however, this did not include the backlog for pharmaceutical or biotechnology innovations. During 2022, the examination of patent and trademark applications and the registration of copyrights were improved through technological updates leading to reductions of the corresponding backlogs.

Enforcement of IP rights in Argentina continues to be a challenge, and stakeholders report widespread unfair competition from sellers of counterfeit and pirated goods and services.  *La**Salada***in Buenos Aires remains the largest counterfeit market in Latin America and is cited in USTR’s 2022 Review of Notorious Markets for Piracy and Counterfeiting. During 2022, there was an increase in the number of small markets selling counterfeit goods (colloquially known as saladas or saladitas) as well as illegal street vendors (colloquially known as manteros) located in main avenues of commercial neighborhoods. Argentine police generally do not take ex officio actions, prosecutions can stall and languish in excessive formalities, and, when a criminal case does reach final judgment, criminal infringers rarely receive deterrent sentences. Hard goods counterfeiting and optical disc piracy are widespread, and online piracy continues to grow due to nearly nonexistent criminal enforcement against such piracy.  As a result, IP enforcement online in Argentina consists mainly of right holders trying to convince Argentine internet service providers to agree to take down specific infringing works, as well as attempting to seek injunctions in civil cases, both of which can be time-consuming and ineffective.

During 2022, INPI finalized an electronic patent and trademark filing system begun during the pandemic and implemented a complete online system with electronic payments for all services it provides.  The agency has published process manuals for patents, trademarks, and technology transfers in order to improve transparency.  INPI welcomes collaboration with the United States for 2023, especially in areas such as women in intellectual property rights (the 2023 theme for World IP Day) and working with small and medium size enterprises.

In December 2022, Argentina and the United States held a bilateral meeting under the Innovation and Creativity Forum for Economic Development, part of the U.S.-Argentina Trade and Investment Framework Agreement, to continue discussions and collaboration on IP topics of mutual interest.  The United States intends to monitor all the outstanding issues for progress and urges Argentina to continue its efforts to create a more attractive environment for investment and innovation.

For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/

							6. Financial Sector					

### Capital Markets and Portfolio Investment

The Argentine Constitution sets as a general principle that foreign investors have the same status and the same rights as local investors. Foreign investors have free access to domestic and international financing.

After a multi-year recession (2018-2020) exacerbated by the COVID-19 pandemic, the Argentine economy expanded 5.2 percent in 2022 following a rebound of 10.3 percent in 2021. However, the government did not ease the capital controls introduced in September 2019 to slow the outflow of dollars. Central Bank capital controls prohibiting transfers and payments are likely in conflict with IMF Article VIII. The government has maintained trade restrictions, price controls, distortive taxes, and high spending. Unable to access international capital markets (despite restructuring private debt in 2020) and with a shallow and saturated domestic market, the government relied on Central Bank direct and indirect monetary financing of the deficit. The excess liquidity resulted in high inflation (94.8 percent in 2022) and deteriorating social conditions, with the poverty rate reaching 39.2 percent in the second half of 2022.

In August 2020, the government of Argentina formally notified the International Monetary Fund (IMF) of its intent to renegotiate $45 billion due to the Fund from the 2018 Stand-By Arrangement. On March 25, 2022, the IMF Executive Board approved an Extended Fund Facility (EFF) program for Argentina. In broad terms, the program targets of the EFF include a reduction in the primary fiscal deficit, a gradual elimination of monetary financing of the deficit, and the accumulation of foreign reserves. Argentina has been able to meet the IMF program targets in the first four reviews despite its heterodox economic measures. However, meeting the targets has not helped to rebalance the economy or set it on a sustainable path. Macroeconomic imbalances persist, fueled by weak confidence, low policy credibility, high inflation, and uncertainty ahead of national elections in 2023.

The Argentine Securities and Exchange Commission (CNV, Comisión Nacional de Valores) is the federal agency that regulates securities markets offerings. Securities and accounting standards are transparent and consistent with international norms. Foreign investors have access to a variety of options on the local market to obtain credit. Nevertheless, the domestic credit market is small – credit is 9 percent of GDP. Private sector credit gained some following the reopening of the economy after the pandemic and government support measures such as subsidized credit lines for businesses. Nevertheless, the stock of credit shrank in real terms as the nominal credit growth increased by 65 percent in 2022, below the inflation rate of 94.8 percent. The Buenos Aires Stock Exchange is the organization responsible for the operation of Argentina’s primary stock exchange, located in Buenos Aires city. The most important index of the Buenos Aires Stock Exchange is the MERVAL (Mercado de Valores).

U.S. banks, securities firms, and investment funds are well-represented in Argentina and are dynamic players in local capital markets. In 2003, the government began requiring foreign banks to disclose to the public the nature and extent to which their foreign parent banks guarantee their branches or subsidiaries in Argentina.

### Money and Banking System

Argentina has a relatively sound banking sector based on diversified revenues, well-contained operating costs, and a high liquidity level. Argentina’s banking sector was resilient in the face of the most recent multi-year economic recession (2018-2020). The strong post-Covid recovery of the economy generated dynamism for many sectors of the economy but has not translated into increased credit to the private sector. The operating environment is challenging, given political and policy uncertainties, continued domestic economic weakness (falling real income) and rising volatility on global capital markets. Limited financial intermediation combined with high inflation and interventionist interest rate regulations (mainly for small businesses) dented bank profitability in 2022. Banks compensated for this by controlling expenses and increasing digitalization of the sector. Private sector credit has started to falter in the face of monetary tightening (interest rates increased 38 percentage points). Banks have sought to protect their balance sheets by increasing their exposure to the public sector; total credit to the public sector amounted to 50 percent of banking system assets in 2022. Non-performing private sector loans constitute 3.1 percent of banks’ portfolios. During 2022, financial entities maintained adequate solvency indicators. The banking sector is well positioned due to macro and micro-prudential policies introduced since 2002 that have helped to reduce asset-liability mismatches. The sector is highly liquid and its provisions for bad debts are adequate.

Private banks have total assets of approximately ARS 17.9 trillion (USD $90.7 billion). Total financial system assets are approximately ARS 29.6 trillion (USD $150 billion). The Central Bank of Argentina acts as the country’s financial agent and is the main regulatory body for the banking system.

Foreign banks and branches can establish operations in Argentina. They are subject to the same regulation as local banks. Argentina’s Central Bank has many correspondent banking relationships, none of which are known to have been lost in the past three years.

In November 2020, the Central Bank launched a new payment system, “Transfers 3.0,” seeking to reduce the use of cash. This system will boost digital payments and further financial inclusion in Argentina, expanding the reach of instant transfers to build an open and universal digital payment ecosystem. The government has expressed support for the process of digitization of payments to improve efficiency, reduce costs, and safeguard financial stability. Technological improvements coupled with Central Bank promoting regulation contributed to an increase in the use of electronic payments to a level of 100 percent of GDP (up 6 percentage points) in 2022.

The Central Bank has enacted a resolution recognizing cryptocurrencies and requiring that they comply with local banking and tax laws. No implementing regulations have been adopted. Block chain developers report that several companies in the financial services sector are exploring or considering using block chain-based programs externally and are using some such programs internally.

### Foreign Exchange and Remittances

#### Foreign Exchange

Beginning in September 2019, the Argentine government and Central Bank issued a series of decrees and norms to extend or amend the government’s ability to regulate and restrict access to foreign exchange markets.

As of October 2019, the Central Bank (Notice A6815) limits cash withdrawals made abroad with local debit cards to foreign currency bank accounts owned by the client in Argentina. Pursuant to Notice A6823, cash advances made abroad using local credit cards are limited to a maximum of USD $50 per transaction.

As of September 2020, and pursuant to Notice A7106, Argentine individuals must limit purchases of foreign currency (or of goods and services denominated in foreign currency) to no more than USD $200 per month on a rolling monthly basis. Individuals must receive Central Bank approval to purchase foreign currency in excess of the $200 quota. Purchases of goods and services abroad with credit and debit cards issued by Argentine banks count against the USD $200 per month quota. Although no limit on credit or debit card purchases is imposed, if monthly expenditures surpass the USD $200 limit, the card owner will be prevented from purchasing foreign currency in Argentina for the number of months needed to cover the amount of excess spending. Also, the regulation prohibits individuals who receive government assistance and high-ranking federal government officials from purchasing foreign exchange.

Pursuant to Public Emergency Law 27,541, issued December 23, 2019, all dollar purchases and individual expenses incurred abroad, in person or online, including international online purchases from Argentina, paid with credit or with debit cards will be subject to a 30 percent tax. Pursuant to AFIP Resolution 4815 a 35 percent withholding tax in advance of the payment of income and/or wealth tax is also applied. Pursuant to AFIP Resolution 5272 a 25 percent withholding tax in advance of the payment of the wealth tax is applied on top of the previous tax rates.

Non-Argentine residents are required to obtain prior Central Bank approval to purchase more than USD $100 per month, except for certain bilateral or international organizations, institutions and agencies, diplomatic representation, and foreign tribunals.

Companies and individuals need to obtain prior clearance from the Central Bank before transferring funds abroad. In the case of individuals, if transfers are made from their own foreign currency accounts in Argentina to their own accounts abroad, they do not need to obtain Central Bank approval.

Per Notice A6869 issued by the Central Bank in January 2020, companies will be able to repatriate dividends without Central Bank authorization equivalent to a maximum of 30 percent of new foreign direct investment made by the company in the country. To promote foreign direct investment the Central Bank announced in October 2020 (Notice A7123) that it will allow free access to the official foreign exchange market to repatriate investments as long as the capital contribution was transferred and sold in Argentine Pesos through the foreign exchange market as of October 2, 2020, and the repatriation takes place at least two years after the transfer and settlement of those funds. Per notice A7626 issued by the Central Bank in October 2022, access to foreign exchange is not subject to Central Bank approval or to the 30 percent distribution limit whenever profits are generated as a result of direct foreign investment that financed projects under the Plan for the Promotion of Natural Gas Production, and the access to the foreign exchange market is requested after two years from the date of the contribution. Access to the foreign exchange market is also allowed for clients that increased exports of goods in 2021 or 2022, for an amount equal to the profits and dividends to be paid.

Exporters of goods are required to transfer their proceeds from exports to Argentina and settle in pesos in the foreign currency market. Exporters must settle according to the following terms: exporters with affiliates (irrespective of the type of good exported) and exporters of certain goods (including cereals, seeds, minerals, and precious metals, among others) must convert their foreign currency proceeds to pesos within 15 days (or 30 days for some products) after the issuance of the permit for shipment; other exporters have between 180 to 365 days to settle in pesos, depending on the product and the relation with the importer. Outside these deadlines, exporters must transfer the funds to Argentina and settle in pesos within five business days from the actual collection of funds.

Argentine residents are required to transfer to Argentina and settle in pesos the proceeds from services exports rendered to non-Argentine residents that are paid in foreign currency either in Argentina or abroad, within five business days from collection of funds. In June 2022, the Central Bank issued Notice A7518 which exempts individuals and legal entities that perform certain activities (including IT services, telecommunications services, charges for the use of intellectual property) from settling in the official foreign exchange market a portion of the proceeds from exports of services, if certain requirements are met. For individuals, up to $12,000 per calendar year is exempt provided the individual files a sworn statement with the local financial institution stating that they did not engage in blue chip swap market exchanges during the previous 90 days and committing not to use it during the next 90 days. For companies or legal entities, they must obtain a “Certification of increase in the collection of funds from export of services in 2022” from a local financial institution. To obtain this the legal entity must meet several requirements, including: demonstrating an increase in exports in 2022 compared to the previous year; the exporter settled the foreign currency in the official market during 2022; the exporter did not use the blue-chip swap market during the previous 90 days and commits not to use it for the next 90 days.

In October 2022, the government issued Decree 679 establishing an investment promotion regime for exports from knowledge-based economy activities. Companies may adhere to the regime by presenting one or more investment projects in infrastructure, capital goods, or working capital aimed at increasing the exports from knowledge-based activities and make a direct investment of more than $3 million. Beneficiaries of the regime will be exempt from settling in the official market up to 20 percent of the foreign currency received as foreign direct investment. These funds must be deposited in a special account in Argentina and may be applied to the payment of principal and interest of commercial or financial liabilities abroad, dividends, and/or repatriation of foreign currency for non-residents. The decree also established that companies will have access to foreign currency equal to 30 percent of the foreign currency brought into Argentina from the net incremental exports on a quarterly basis, taking as comparative base period the same quarter of 2021. The foreign currency must be deposited in a special bank account in Argentina and shall only be applied to the payment of employees working in the promoted activities.

Payment of imports of goods and services from third parties and affiliates require Central Bank approval if the company needs to purchase foreign currency. Since May 2020, the Central Bank requires importers to submit an affidavit stating that the total amount of payments associated with the import of goods made during the year (including the payment that is being requested). The total amount of payments for importation of goods should also include the payments for amortizations of lines of credit and/or commercial guarantees.

In September 2020, the Central Bank limited companies’ ability to purchase foreign currency to cancel any external financial debt (including other intercompany debt) and dollar denominated local securities offerings. Companies were granted access to foreign currency for up to 40 percent of the principal amount coming due from through December 31, 2020. This was extended multiple times, and in October 2022 extended again to include debt up through December 31, 2023. For the remaining 60 percent of the debt, companies had to file a refinancing plan with the Central Bank. Indebtedness with international organizations or their associated agencies or guaranteed by them and indebtedness granted by official credit agencies or guaranteed by them are exempted from this restriction.

The Central Bank (Notice A7001) prohibited access to the foreign exchange market to pay for external indebtedness, imports of goods and services, and saving purposes for individuals and companies that have made sales of securities with settlement in foreign currency or transfers of these to foreign depositary entities within the last 90 days. They also should not make any of these transactions for the following 90 days.

Pre-cancellation of debt coming due abroad in more than three business days requires Central Bank approval to purchase dollars.

Per Resolution 36,162 of October 2011, locally registered insurance companies are mandated to maintain all investments and cash equivalents in the country. The Central Bank limits banks’ dollar-denominated asset holdings to 5 percent of their net worth.

In January 2022, the Central Bank presented its monetary, financial, lending, and foreign exchange program. On monetary policy, the Central Bank committed to 1) safeguard availability of savings instruments with positive returns compared to both inflation and exchange rate depreciation with the intention to anchor foreign exchange expectations, and favor the disinflation process; and 2) to maintain a prudential management of the monetary aggregates, by sterilizing a potential liquidity surplus to preserve equilibrium in the monetary market. On foreign exchange, the Central Bank will gradually maintain the crawling peg of the exchange rate consistent with the pace of inflation. As long as macroeconomic conditions allow, the Central Bank will relax capital control regulations in the medium- and long-term. To support economic activity, the Central Bank will boost both the financial intermediation and inclusion of individuals and companies to meet financing and production and consumption needs. Credit assistance channeled to the sectors most affected by the pandemic will be gradually reduced as long as they consolidate their recovery process.

#### Remittance Policies

In response to the economic crisis in Argentina, the government introduced capital controls in September 2019 and tightened them in 2020.  Under these restrictions, companies in Argentina (including local affiliates of foreign parent companies) must obtain prior approval from the Central Bank to access the foreign exchange market to purchase foreign currency and to transfer funds abroad for the payment of dividends and profits.  In January 2020, the Central Bank amended the regime for the payment of dividends abroad to non-residents. The new regime allows companies to access the foreign exchange market to transfer profits and dividends abroad without prior authorization of the Central Bank, provided the following conditions are met:

(1) Profits and dividends are to be declared in closed and audited financial statements.(2) The dividends in foreign currency should not exceed the dividends determined by the shareholders’ meeting in local currency.(3) The total amount of dividends to be transferred cannot exceed 30 percent of the amount of new capital contributions made by non-residents into local companies since January 2020.(4) The resident entity must be in compliance with filing the Central Bank Survey of External Assets and Liabilities.

### Sovereign Wealth Funds

The Argentine government does not maintain a Sovereign Wealth Fund.

							7. State-Owned Enterprises					

The Argentine government has state-owned enterprises (SOEs) or significant stakes in mixed-capital companies in the following sectors: civil commercial aviation, water and sanitation, oil and gas, electricity generation, transport, paper production, satellite, banking, railway, shipyard, defense and aircraft ground handling services.

By Argentine law, a company is considered a public enterprise if the state owns 100 percent of the company’s shares. The state has majority control over a company if the state owns 51 percent of the company’s shares. The state has minority participation in a company if the state owns less than 51 percent of the company’s shares. Laws regulating SOEs and enterprises with state participation can be found at http://www.saij.gob.ar/13653-nacional-regimen-empresas-estado-lns0001871-1955-03-23/123456789-0abc-defg-g17-81000scanyel.

Through the government’s social security agency (ANSES), the Argentine government owns stakes ranging from one to 31 percent in 46 publicly listed companies. U.S. investors also own shares in some of these companies. As part of the ANSES takeover of Argentina’s private pension system in 2008, the government agreed to commit itself to being a passive investor in the companies and limit the exercise of its voting rights to 5 percent, regardless of the equity stake the social security agency owned. A list of such enterprises can be found at: http://fgs.anses.gob.ar/participacion.

State-owned enterprises purchase and supply goods and services from the private sector and foreign firms. Private enterprises may compete with SOEs under the same terms and conditions with respect to market share, products/services, and incentives. Private enterprises also have access to financing terms and conditions similar to SOEs. SOEs are subject to the same tax burden and tax rebate policies as their private sector competitors. SOEs are not currently subject to firm budget constraints under the law and have been subsidized by the central government in the past. During 2020 subsidies increased to maintain a tariff freeze on public services given the COVID-19 pandemic. Since 2022, the Government of Argentina has sought to reduce energy subsidies in an effort to contain spending and meet the targets set in the Extended Fund Facility (EFF) agreement with the IMF.. Argentina does not have regulations that differentiate treatment of SOEs and private enterprises. Argentina has observer status under the WTO Agreement on Government Procurement and, as such, SOEs are subject to the conditions of Argentina’s observance.

Argentina does not have a specified ownership policy, guideline, or governance code for how the government exercises ownership of SOEs. The country generally adheres to the OECD Guidelines on Corporate Governance of SOEs. The practices for SOEs are mainly in compliance with the policies and practices for transparency and accountability in the OECD Guidelines. In 2018, the OECD released a report evaluating the corporate governance framework for the Argentine SOE sector relative to the OECD Guidelines, which can be viewed here: http://www.oecd.org/countries/argentina/oecd-review-corporate-governance-soe-argentina.htm.

Argentina does not have a centralized ownership entity that exercises ownership rights for each of the SOEs. The general rule in Argentina is that requirements that apply to all listed companies also apply to publicly listed SOEs.

### Privatization Program

The current administration has not developed a privatization program.

							8. Responsible Business Conduct					

There is an increasing awareness of corporate social responsibility (CSR) and responsible business conduct (RBC) among both producers and consumers in Argentina. RBC and CSR practices are welcomed by beneficiary communities throughout Argentina. There are many institutes that promote RBC and CSR in Argentina, the most prominent being the Argentine Institute for Business Social Responsibility (http://www.iarse.org/), which has been working in the country for 20 years and includes among its members many of the most important companies in Argentina.

Argentina is a member of the United Nation’s Global Compact. Established in April 2004, the Global Compact Network Argentina is a business-led network with a multi-stakeholder governing body elected for two-year terms by active participants. The network is supported by the United Nations Development Program (UNDP) Argentina in close collaboration with other UN Agencies. The Global Compact Network Argentina is the most important RBC/CSR initiative in the country with a presence in more than 20 provinces. More information on the initiative can be found at: http://pactoglobal.org.ar.

Foreign and local enterprises tend to follow generally accepted CSR/RBC principles. Argentina subscribed to the Declaration on the OECD Guidelines for Multinational Enterprises in April 1997.

Many provinces, such as Mendoza and Neuquén, have or are in the process of enacting a provincial CSR/RBC law. There have been many previously unsuccessful attempts to pass a CSR/RBC law. Distrust over the State’s role in private companies had been the main concern for legislators opposed to these bills.

In February 2019, the Argentine government joined the Extractive Industries Transparency Initiative (EITI).  EITI published the Argentina 2022 Validation Report where Argentina has successfully established company EITI reporting practices in the mining sector.

https://eiti.org/documents/argentina-2022-validation-report

### Additional Resources

Department of State

- Country Reports on Human Rights Practices ( https://www.state.gov/reports-bureau-of-democracy-human-rights-and-labor/country-reports-on-human-rights-practices/ )
- Trafficking in Persons Report ( https://www.state.gov/trafficking-in-persons-report/ )
- Guidance on Implementing the “UN Guiding Principles” for Transactions Linked to Foreign Government End-Users for Products or Services with Surveillance Capabilities ( https://www.state.gov/key-topics-bureau-of-democracy-human-rights-and-labor/due-diligence-guidance/ )
- U.S. National Contact Point for the OECD Guidelines for Multinational Enterprises ( https://www.state.gov/u-s-national-contact-point-for-the-oecd-guidelines-for-multinational-enterprises/ )
- Xinjiang Supply Chain Business Advisory ( https://www.state.gov/xinjiang-supply-chain-business-advisory/ )

Department of the Treasury

- OFAC Recent Actions ( https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions )

Department of Labor

- Findings on the Worst Forms of Child Labor Report ( https://www.dol.gov/agencies/ilab/resources/reports/child-labor/findings  )
- List of Goods Produced by Child Labor or Forced Labor ( https://www.dol.gov/agencies/ilab/reports/child-labor/list-of-goods )
- Sweat & Toil: Child Labor, Forced Labor, and Human Trafficking Around the World ( https://www.dol.gov/general/apps/ilab )
- Comply Chain ( https://www.dol.gov/ilab/complychain/ )

### Climate Issues

The Government of Argentina created its national climate strategy, the National Plan for Adaptation and Mitigation (PANyMCC), to implement its Nationally Determined Contribution (NDC). This plan calls for developing a long-term strategy under the Paris Agreement Agreement (which Argentina submitted at COP27 in Egypt) as well as delineating the revision, improvement, and monitoring of the Sector Action Plans for the main emissions sectors. Multiple laws exist to control water and air pollution and to protect natural ecosystems. Despite the existing strategy and monitoring framework, stakeholders note limited transparency around both climate-related and energy sector planning and policymaking. Challenges in the business and investment climate impact the country’s attractiveness for developing renewable energy projects, despite the potential for both wind and solar power. The fossil fuel industry is strongly supported by the government through public subsidies, which impair the cost-competitiveness of renewable energy technologies.

Renewable energy development is still a focus for the government. Law 27,191 set a goal that 20 percent of the energy matrix needed to come from renewable sources by 2025, this was later updated in the energy sector’s action plan under PANyMCC to 25 percent by 2030. The 2021 updated NDC submitted at COP26 set a goal of 30 percent by 2030. Several tax benefits exist to support renewable energy projects through Law 27,191. No new projects have been approved since the previous administration through the RenovAr program, which offered IFC funding and World Bank guarantees. The RenovAr program has faced multiple hurdles such as increased capital costs, currency volatility, and the impact of capital controls. Given the current state of energy transmission infrastructure in the country, smaller scale projects for on-site energy consumption are more likely to succeed.

Argentina joined the Net Zero World Initiative, a program run by the U.S. Department of Energy to help countries decarbonize their energy sectors. Argentina and the United States are working closely on energy efficiency cooperation.

The Government of Argentina has historically focused on the transportation sector by encouraging the use of biofuels and electric vehicles. The country requires all gasoline to be a mixture between petroleum products and biofuels. In 2021, the Biofuels Regulatory Framework extended tax exemptions and benefits for biofuel producers but at the same time reduced the quantity of biofuels that are required to be used. The reduction in biofuel use is inconsistent with the climate change mitigation commitments Argentina has made.

While still not approved, the draft Law for the Promotion of Sustainable Mobility includes incentives and objectives to promote the use of technologies with less environmental impact for mobility. The proposed scheme would be temporary but offers fiscal benefits over 20 years for the production and importation of electric vehicles and parts.

There are regulatory requirements for labelling of products according to energy efficiency standards. Products including home construction supplies, vehicles, gas powered appliances, and domestic electronics are required to be labeled, some with minimum efficiency standards. Additionally, incandescent light bulbs are no longer permitted to be produced or imported into the country to encourage the use of more energy-efficient lighting sources. More information on labeling standards can be found here: https://www.argentina.gob.ar/economia/energia/eficiencia-energetica/etiquetado-en-eficiencia-energetica

							9. Corruption					

Argentina’s legal system incorporates several measures to address public sector corruption. The foundational law is the 1999 Public Ethics Law (Law 25,188), the full text of which can be found at: http://servicios.infoleg.gob.ar/infolegInternet/verNorma.do?id=60847. A March 2019 report by the OECD’s Directorate for Public Governance underscored, however, that the law is heterogeneously implemented across branches of the government and that the legislative branch has not designated an application authority, approved an implementing regulation, or specified sanctions. It also noted that Argentina has a regulation on lobbying, but that it only applies to the executive branch, and only requires officials to disclose meetings with lobbyists. With regards to political parties, the report noted anonymous campaign donations are banned, but 90 percent of all donations in Argentina are made in cash, making it impossible to identify donors. Furthermore, the existing regulations have insufficient controls and sanctions, and leave gaps with provincial regulations that could be exploited.

Within the executive branch, the government institutions tasked with combatting corruption include the Anti-Corruption Office (ACO), the National Auditor General, and the General Comptroller’s Office. Public officials are subject to financial disclosure laws, and the Ministry of Justice’s ACO is responsible for analyzing and investigating federal executive branch officials based on their financial disclosure forms—which require the disclosure of assets directly owned by immediate family members. The ACO is also responsible for investigating corruption within the federal executive branch or in matters involving federal funds, except for funds transferred to the provinces. While the ACO does not have authority to independently prosecute cases, it can refer cases to other agencies or serve as the plaintiff and request that a judge initiate a case.

Argentina enacted a Corporate Criminal Liability Law in November 2017 following the advice of the OECD to comply with its Anti-Bribery Convention. The full text of Law 27,401 can be found at: http://servicios.infoleg.gob.ar/infolegInternet/anexos/295000-299999/296846/norma.htm . The law entered into force in early 2018. It extends anti-bribery criminal sanctions to corporations, whereas previously they only applied to individuals; expands the definition of prohibited conduct, including illegal enrichment of public officials; and allows Argentina to hold Argentines responsible for foreign bribery. Sanctions include fines and blacklisting from public contracts. Argentina also enacted an express prohibition on the tax deductibility of bribes.

Official corruption remains a serious challenge in Argentina. In its June 2019 report, the OECD Working Group on Bribery in International Business Transactions found that Argentina remained seriously non-compliant with key articles of the Convention. Among the most significant legislative deficiencies were problems with the foreign bribery offence, the absence of corporate liability for foreign bribery, and jurisdiction to prosecute this offence. According to the World Bank’s worldwide governance indicators, corruption remains an area of concern in Argentina. In the latest Transparency International Corruption Perceptions Index (CPI), Argentina ranked 94 out of 180 countries in 2022, maintaining the same transparency score compared to 2021. Allegations of corruption in provincial as well as federal courts remained frequent. Few Argentine companies have implemented anti-foreign bribery measures beyond limited codes of ethics.

In September 2016, Congress passed a law on public access to information. The law explicitly applies to all three branches of the federal government, the public justice offices, and entities such as businesses, political parties, universities, and trade associations that receive public funding. It requires these institutions to respond to citizen requests for public information within 15 days, with an additional 15-day extension available for “exceptional” circumstances. Sanctions apply for noncompliance. As mandated by the law, the executive branch created the Agency for Access to Public Information in 2017, an autonomous office that oversees access to information. In early 2016, the Argentine government reaffirmed its commitment to the Open Government Partnership (OGP), became a founding member of the Global Anti-Corruption Coalition, and reengaged the OECD Working Group on Bribery.

Argentina is a party to the Organization of American States’ Inter-American Convention against Corruption. It ratified in 2001 the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (Anti-Bribery Convention). Argentina also signed and ratified the UN Convention against Corruption (UNCAC) and participates in UNCAC’s Conference of State Parties. Argentina also participates in the Mechanism for Follow-up on the Implementation of the Inter-American Convention against Corruption (MESICIC).

Since Argentina became a party to the OECD Anti-Bribery Convention, allegations of Argentine individuals or companies bribing foreign officials have surfaced. A March 2017 report by the OECD Working Group on Bribery indicated there were 13 known foreign bribery allegations involving Argentine companies and individuals as of that date.

### Resources to Report Corruption

Contact at the government agency or agencies that are responsible for combating corruption:Veronica GomezDirectorGovernment of Argentina Anti-Corruption OfficeOficina Anticorrupción, 25 de Mayo 544, C1002ABL, Ciudad Autónoma de Buenos Aires.Phone: +54 11 5300 4100Email: anticorrupcion@jus.gov.ar and http://denuncias.anticorrupcion.gob.ar/

Contact at a “watchdog” organization:German EmanuelePrograma de Asistencia Legal Anticorrupciòn (ALAC) Poder CiudadanoPiedras 547, C1070AAK, Ciudad Autónoma de Buenos AiresPhone: +54 11 4331 4925 ext. 225Fax: +54 11 4331 4925Email: coordinador@centroalac.org.arWebsite: http://www.poderciudadano.org

							10. Political and Security Environment					

Demonstrations are common in metropolitan Buenos Aires and in other major cities and rural areas. Nevertheless, political violence is not widely considered a hindrance to the investment climate in Argentina.

Protesters regularly block streets, highways, and major intersections, causing traffic jams and delaying travel. While demonstrations are usually non-violent, individuals sometimes seek confrontation with the police and vandalize private property. Groups occasionally protest in front of the U.S. Embassy or U.S.-affiliated businesses. In March 2022, thousands protested in front of Congress against a bill approving a new agreement with the IMF.

Union disputes and politicized worker movements are common in CABA and the Provinces. On August 17, 2022, labor unions, social movements and left-wing political parties marched through the center of the city of Buenos Aires to protest against the economic crisis and the increase in poverty. On August 19, 2022, the Front of Organizations in Struggle (FOL) organized a funeral march for wages across Buenos Aires. As yearly inflation in 2022 started to near 100 percent at the end of 2022 and the government undertook measures to regulate its social welfare programs, social organizations and protesters have taken to the streets to demand more support to counter the impact of inflation.

							11. Labor Policies and Practices					

Argentine workers are among the most highly educated and skilled in Latin America. Foreign investors often cite Argentina’s skilled workforce as a key factor in their decision to invest in Argentina. Argentina has relatively high social security, health, and other labor taxes, however, high labor costs are among foreign investors’ most often cited operational challenges. The unemployment rate dropped to 7.1 percent at the end of 2022, according to official statistics. The government estimated unemployment for workers below 29 years old as more than double the national rate. Analysts estimate labor informality between 20 to 40 percent.

The Teleworking Contracts Regime, Law 27,555, passed by Congress on July 30, 2020, and ratified by President Fernandez on August 14, 2020 entered into force on April 1, 2021. This law provides the legal framework for teleworking in employment settings that allow it.

Labor laws are comparatively protective of workers in Argentina, and investors cite labor-related litigation as an important factor increasing labor costs in Argentina. There are no special laws or exemptions from regular labor laws in the Foreign Trade Zones. Organized labor plays an important role in labor-management relations and in Argentine politics. Under Argentine law, the Ministry of Labor recognizes one union per sector per geographic unit (e.g., nationwide, a single province, or a major city) with the right to negotiate a collective bargaining agreement for that sector and geographic area. Roughly 40 percent of Argentina’s formal workforce is unionized. The Ministry of Labor ratifies collective bargaining agreements. Collective bargaining agreements cover workers in a given sector and geographic area whether they are union members or not, so roughly 70 percent of the workforce was covered by an agreement. While negotiations between unions and industry are generally independent, the Ministry of Labor often serves as a mediator. Argentine law also offers recourse to mediation and arbitration of labor disputes.

Tensions between management and unions occur. Many managers of foreign companies say they have good relations with their unions. Others say the challenges posed by strong unions can hinder further investment by their international headquarters. Depending on how sectors are defined, some activities such as oil and gas production or aviation involve multiple unions, which can lead to inter-union power disputes that can impede the companies’ operations. Labor-related demonstrations in Argentina occurred periodically in 2022. Reasons for strikes include job losses, high taxes, loss of purchasing power, and wage negotiations. Labor demonstrations may involve tens of thousands of protestors. Past demonstrations have essentially closed sections of a city for a few hours or impeded traffic. A September 2022 strike by workers in tire manufacturing demanding higher salaries disrupted not only those factories, but also slowed or shut down automobile production.

The Fernandez government does not intend to pursue a broad labor reform bill, preferring instead to allow firms and workers to negotiate any adjustments to labor conditions through the collective bargaining process. The Ministry of Labor has indicated interest in proposing a “gig economy” bill (ley de plataformas) that would extend basic labor rights to, e.g., delivery workers coordinated through information technology applications.

The Ministry of Labor has hotlines and an online website to report labor abuses, including child labor, forced labor, and labor trafficking. The Superintendent of Labor Risk (Superintendencia de Riesgos del Trabajo) has oversight of health and safety standards. Unions also play a key role in monitoring labor conditions, reporting abuses and filing complaints with the authorities. Argentina has a Service of Mandatory Labor Conciliation (SECLO), which falls within the Ministry of Labor. Provincial governments and the city government of Buenos Aires are also responsible for labor law enforcement.

The minimum age for employment is 16. Children between the ages of 16 and 18 may work in a limited number of job categories and for limited hours if they have completed compulsory schooling, which normally ends at age 18. The law requires employers to provide adequate care for workers’ children during work hours to discourage child labor. The Department of Labor’s 2021 Worst Form of Child Labor for Argentina can be accessed here:https://www.dol.gov/agencies/ilab/resources/reports/child-labor/argentina

The Department of State’s 2021 Human Rights Report for Argentina can be accessed here:https://www.state.gov/reports/2021-country-reports-on-human-rights-practices/argentina/

Argentine law prohibits discrimination on the grounds of sex, race, nationality, religion, political opinion, union affiliation, or age. The law also prohibits employers, either during recruitment or time of employment, from asking about a worker’s political, religious, labor, and cultural views or sexual orientation. These national anti-discrimination laws also apply to labor relations and other social relations.

Argentina has been a member of the International Labor Organization since 1919.

							12. U.S. International Development Finance Corporation (DFC), and Other Investment Insurance or Development Finance Programs					

The Argentine government signed a comprehensive agreement with the Overseas Private Investment Corporation (OPIC) in 1989. The agreement allows OPIC, now the U.S. International Development Finance Corporation (DFC), to insure U.S. investments against risks resulting from expropriation, inconvertibility, war, or other conflicts affecting public order. In 2018, OPIC and the Government of Argentina signed six letters of interest.  Five additional award letters were signed in 2019 to advance key projects in support of Argentina’s economic growth.  The agreements support the****logistics and value chains, transportation infrastructure and energy sectors.

Argentina is also a member of the World Bank’s Multilateral Investment Guarantee Agency (MIGA).

							13. Foreign Direct Investment Statistics