In August 2005 the federal government enacted two decrees creating investment programmes in order to encourage private investment in public works. Through Decree 966/2005 the National Private Initiative Regime was adapted to meet the real needs of the government and private investors. The National Public and Private Association Regime was established through Decree 967/2005.
Most of the major electricity generation companies have accepted the government's offer to finance the construction of two new steam power plants. The companies will swap their present and future credits against the Wholesale Electric Market Administrator Company for shares in the new plants.
The government has created trust funds to finance gas and electricity investments, especially for transportation and distribution. The government passed a resolution structuing a financial trust and creating a global programme for the issue of securities representing debt and/or certificates of participation in financial trusts up to a maximum of $3 billion.
The Argentine government recently enacted the Trust Law which, for the first time, permits trusts to be used as security over assets - a useful tool in project financings. However, certain provisions of the law conflict with other legislation so as to throw the validity of guarantee trusts into doubt.
Including: Contractual Aspects; Guarantees