FOREIGN INVESTMENT - ARGENTINA
1. Are there any restrictions on foreign investments?
In general, foreign investors wishing to invest in Argentina, either by starting up a new business or by acquiring an existing business or company, do not require prior government approval. There are exceptions, however, for certain regulated areas.
Foreign investments are protected by the Argentine Foreign Investments Law (the “FIL”) which, as a general principle, states that foreigners investing in economic activities in Argentina enjoy the same status and have the same rights that the Argentine Constitution affords to local investors.
2. Which are the forms and vehicles under which a foreign investor may invest in your country?
The main types of investment vehicle utilized by non-resident individuals and foreign companies seeking to conduct a business in Argentina on a permanent basis are the branch, the corporation (sociedad anónima - “SA”), and the limited liability company (sociedad de responsabilidad limitada - “SRL”). Incorporation procedures of the three vehicles are comparable.
3. How long does it take to create such forms and vehicles and what are the minimum costs?
Formation proceedings and registration of any of the vehicles referred to in section 2 take approximately thirty days, although can only be started after the completion of the registration process of the foreign entities that will be the shareholders or partners of the local company.
An approximate range of the minimum administrative costs (excluding translation of documents and fees) to register the referred vehicles is between US$ 800 and 1,000 (plus Value Added Tax at 21%).
As a general principle, foreigners investing in economic activities in Argentina enjoy the same status and have the same rights that the Argentine Constitution grants to local investors.
In addition, in recent years Argentina has entered into several treaties for the promotion and protection of foreign investments with a number of countries, including China. The main purpose of these treaties has been to enhance foreign investment protection and provide investors with additional safeguards.
With regard to repatriation of investments and dividends, capital repatriation by non-Argentine residents is generally permitted though certain conditions need to be complied with.
5. Are there any exchange control or currency regulations?
The Argentine government imposes certain restrictions aimed at avoiding economic fluctuations due to significant capital flight of certain speculative sectors. As a result thereof, there is a profuse and complex foreign exchange regulation system currently in force which changes continuously.
6. Are there any subsidies, public aid, or any other foreign investment promotion plans?
No, there are no specific subsidies, public aid or promotion plans aimed at supporting specifically foreign investment. We point out, however, that on November 15, 1990 Argentina and China entered into an agreement to promote the formation of binational companies in the territory of any of the signatory parties. Through this agreement the governments of both countries committed to, among other actions, facilitate credit support to such companies and encourage the generation of commercial contacts among the representatives of the relevant organizations and companies. In 1992 Argentina and China also entered into a treaty for the promotion and protection of investments.
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