The legal framework for foreign investments in Argentina is provided by Sections No. 14 and No. 20 of the National Constitution (the NC), the Foreign Investment Law No. 21,382 as amended (the FIL), and the international treaties to which Argentina is a party. These international treaties, among other matters, regulate the promotion and protection of investments, avoid double taxation, and establish social security reciprocity[1].

Foreigners enjoy the same rights as Argentine citizens for doing business in Argentina. Regarding investments, the FIL ratifies the equal constitutional treatment (Section No. 1), defines certain concepts such as foreign capital investment[2]and foreign investor[3], and specifies some forms of foreign investment[4].

The FIL recognizes that foreign investors may use any of the legal forms of organization provided by domestic law (Section No. 6), transfer abroad the net and realized profits from their businesses, and repatriate their investment (Section No. 5).

It is important to note that the rights to remit dividends to parent companies and repatriate investments are currently restricted by foreign exchange regulations that limit access to the foreign exchange market for purchasing foreign currency.

Notwithstanding the full equality of treatment enshrined in the regulations, foreign investments in rural land, border areas, broadcasting media, and domestic air transport services are subject to certain restrictions.

No prior approval is required for foreigners to invest in Argentina, except when antitrust law applies to a transaction.

Complementing the rules of domestic law, Argentina has entered into several international treaties with effect on aspects of foreign investments and doing business in Argentina (e.g., treaties to avoid double taxation and reciprocity treaties on social security matters).

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[1] Under Section No. 75, Sub Section No. 22 of the NC, international treaties have a higher hierarchy than laws.

[2] By Section No. 2, 1, the FIL defines foreign capital investment as:

“(a) Any capital contribution belonging to foreign investors applied to activities of an economic nature carried out in the country.

b) The acquisition of shares in the capital of an existing local company by foreign investors“.

[3] A foreign investor is: “Any individual or legal entity domiciled outside the national territory, holder of an investment of foreign capital” (FIL, Section No. 2, 2). According to Decree No. 1,853/93, the concept of foreign investors includes individuals of Argentine nationality but residing outside the national territory (Section No. 3).

[4] “Foreign investment may be made in:

1. Freely convertible foreign currency.
2. Capital goods, spare parts, and accessories thereof.
3. Profits or capital in local currency belonging to foreign investors as long as those assets may be legally transferred abroad.
4. Capitalization of foreign credits in foreign currency of free convertibility.
5. Intangible assets, in accordance with specific legislation.
6. Other forms of contribution contemplated in special or promotional regimes” (Section No. 3).