Anneliese Moritz

Argentina on the right path

As Argentina prepares for assuming the presidency of the G20, Mrs. Merkel’s recent visit to the country last month is a milestone in a path that Argentina has taken in a very positive direction.

Together with representatives of 60 German companies already established in Argentina as well as 10 German executives active in the areas of energy, transportation, infrastructure and environment, Mrs. Merkel had a productive exchange with local authorities. Several challenges were presented by the German companies and discussed, such as the bureaucracy within the public institutions, the lack of transparency in relation to import licenses which are not granted automatically, the lack of diversification of the energy sources and the need for improvement in the infrastructure of the country.

Argentina is concerned about responding to the needs of foreign investors and, among the measures to enable Argentina’s return to the international scene, which requires a strong local economy, the legislator has taken the initiative to create a more investor-friendly legal environment.

The changes started timidly in 2015, as the one-shareholder company was implemented.

Last April, the law for the support of the entrepreneurial capital (Ley de Apoyo al Capital Emprendedor) was enacted. Such law provides for a frame to facilitate investments in general, which comprises tax benefits and specific finance sources to start-ups. The law also contains a special chapter dedicated to the creation of a new corporate type, the Sociedad por Acciones Simplificadas(SAS), with the purpose of facilitating the incorporation, promotion and development of small companies and start-ups within the country.

Furthermore, the new law establishes that the registration process of the company with the Commercial Registry, the opening of a bank account and the obtaining of the tax ID (the so called CUIT) shall be concluded within 24 hours. However, until a regulatory decree to implement such changes is not enacted, there is still some uncertainty on which means will be put in place in order to ensure that such short deadlines are respected.

Such deadline only concerns the incorporation of the company. The deadline for the company to become operative may be longer, depending on its corporate scope and whether licenses are required to operate. In this context, the debureaucratisation and the transparency of the proceedings with public institutions are key issues to enable foreign investors to feel more secure about making investments in the country.

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