Introduction
Advanced import affidavits
Restrictions on payments of services abroad
Other developments
Comment
Argentina's foreign trade had a difficult year in 2012. Both importers and exporters suffered under a series of trade-restricting regulations enacted with one aim in mind: to obtain as much foreign exchange (mainly US dollars) as possible in order to pay for Argentina's ever-increasing energy imports bill. For example, according to the Federal Statistics Office, the sum of imports and exports for the period between January 2012 and October 2012 was 5.1% lower than for the equivalent period in 2011.(1) This fall is comparable only to that experienced by the European countries currently engulfed by the euro crisis.
A number of trade-restricting regulations enacted in 2012 will continue to hinder trade in 2013, as follows.
This non-automatic licence was introduced in February 2012 (for further information please see "Argentina keeps restricting imports" and "Argentina's foreign trade paralysis continues"). Any product imported into Argentina must obtain an affidavit before it is imported. One of the de facto requirements for obtaining such an affidavit (since this requirement is not envisaged in the regulations) is the obligation for importers to keep a balance in their foreign trade. Therefore, importers must either start exporting or enter into agreements with local exporters aimed at helping the latter to export (and obtaining, in exchange, the much needed affidavits).
Restrictions on payments of services abroad
In April 2012 the authorities introduced a system imposing restrictions on the payment of certain services abroad (eg, know-how and technology transfer, software licences and other professional and technical services and management fees) (for further information please see "Government restricts payments for foreign services"). When the service is rendered by a non-related foreign company, the Argentine importer must file certain documents and information with the commercial bank in order to be able to make the payment. If, on the other hand, the services are rendered by a related foreign company, payment of the services by the Argentine importer requires prior Central Bank authorisation. Such authorisation has proven almost impossible to obtain.
In April 2012 the government reduced the time period in which Argentine exporters must repatriate the foreign currency earned in an export transaction. In the case of transactions between related companies, this time period was reduced to 30 days as from the date of shipment. This regulation has particularly affected industries with long payment periods (eg, mining), which have seen a dramatic fall in their exports.
In August 2012 the tax authority announced an increase to 20% (from an original 10%) in the advanced value added tax rate applicable to imports of goods and an increase to 6% (from an original 3%) in the advanced income tax rate. This has resulted in an increase in the financial costs associated with imports (since both taxes may be compensated later on with tax payments).
No significant relaxation of these restrictions is expected for 2013. On the contrary, some of them may be even increased as a consequence of the continuing trade balance problems being suffered by the country and caused by the government's energy policy.
For further information on this topic please contact Esteban P Rópolo at Baker & McKenzie SC by telephone (+54 11 4310 2200), fax (+54 11 4310 2299) or email ([email protected]).
Endnotes
(1) Published by La Nación on December 9 2012.
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