Incentive Regime for Large Investments (RIGI)
1. Large Investment Incentive Regime (RIGI):
Law No. 27,742, in its article 164, introduces the RIGI, which offers key incentives to legal vehicles that manage investment projects that meet the criteria established by law. This regime seeks to provide certainty, legal security, and an efficient system of protection of acquired rights, with the aim of encouraging large investments and guaranteeing the economic prosperity of the country.
2. Main Objectives of RIGI:
RIGI’s priority objectives include:
- Promote large national and foreign investments for the economic development and prosperity of the country.
- Strengthen the competitiveness of various economic sectors and increase exports.
- Create jobs and ensure conditions of predictability and stability for large investments.
- Promote collaboration between the National State and the provinces, as well as the development of local production chains.
3. Single Project Vehicles (VPU):
In accordance with article 169 of the law, Single Project Vehicles (VPU) can join the RIGI, which must be dedicated exclusively to a single investment project. These vehicles must not carry out activities or possess assets not related to the project, except for temporary working capital investments.
4. Dedicated Branches:
Article 170 of Law No. 27,742 allows the creation of Dedicated Branches to manage activities not directly linked to the investment project. These branches must comply with specific requirements, such as registration in the public registry, obtaining a Unique Tax Identification Code (CUIT), and separate accounting from the parent company.
5. Regulations of Decree No. 749/2024:
Decree No. 749/2024 regulates aspects related to Dedicated Branches, establishing additional requirements, such as capital accreditation and accounting separation. The procedures for registering these branches must follow the regulations stipulated in the decree.
The assigned capital can be in pesos or dollars, and must be accredited with the corresponding documents. The assets and liabilities used must be strictly linked to the investment project registered under the RIGI, preventing them from being mixed with other activities of the parent company.
Companies that take advantage of this regime will enjoy guaranteed legal protection, protected against possible non-compliance by the State and benefited from a particular tax regime that promotes long-term investments.
Dedicated Branches must comply with their own tax obligation, separate from the parent company, which ensures greater clarity in their financial transactions. In addition, it is necessary to obtain a Unique Tax Identification Code (CUIT) and register for the taxes relevant to the activities carried out by the company.
6. Requirements for the Registration of Dedicated Branches:
Companies and branches that wish to establish a Dedicated Branch in the Autonomous City of Buenos Aires must present key documentation, including:
Present testimony of a public deed or original private instrument that contains the decision to open the branch for the purposes of joining the RIGI and that contains:
- The headquarters of the Dedicated or Special branch.
- Designation of representative in charge who expressly accepts the position and establishes domicile within CABA.
- Amount of capital assigned for the investment project.
- Description of the unique object of the investment project.
- Accounting opinion issued by a Public Accountant, issued on the affected assets assigned to the capital.
- Present authentic proof of registration in the Public Registry corresponding to your jurisdiction, which certifies the validity of the social registration. Failing that, the professional prequalification opinion must state that the author has verified said point, reporting the registration data with the Public Registry of the jurisdiction in which the company to which the dedicated or Special Branch belongs is registered.
7. Declaration of non-distortion of the local market:
The application for joining the RIGI must contain, in addition to the investment plan and the requirements established by art. 47, a sworn declaration of non-distortion of the local market and a technical study, through which an analysis of the positive and negative effects that the projected investment could have among the actors of the relevant market must be presented, under warning of rejection in limine.
The Enforcement Authority may give intervention to the National Commission for the Defense of Competition to issue a non-binding opinion.
Without prejudice to this, it is expressly ratified that joining the RIGI does not exempt compliance with Law No. 27,442 on the Defense of Competition.
8. Modifications and Cancellation:
Companies may modify or cancel the registration of the Dedicated Branch after the completion of the project or by decision not to continue with it. Foreign branches have the option of becoming branches according to Law No. 19,550.
9. Invitation to Replicate:
A call is made to the provincial Public Registries to replicate the established procedures and regulations, facilitating the implementation of the RIGI at the national level and thus promoting investments in large-scale projects that add value to the Argentine economy.
10. Conclusions:
The Large Investment Incentive Regime (RIGI), established by Law No. 27,742, represents a significant measure to attract and secure large investments, both national and foreign, in the Argentine Republic. Through this legal framework, the possibilities of attracting both national and foreign capital are enabled, offering an environment of certainty and legal security, in order to stimulate economic development, job creation and strengthening competitiveness in various sectors. .
Key aspects of the RIGI include the need for Single Project Vehicles (SPV) to be dedicated exclusively to specific investment projects, and the introduction of a mechanism for the creation of Dedicated Branches. These branches must comply with rigorous requirements, such as separate accounting and capital accreditation, to ensure that assets and liabilities are effectively allocated to the investment project.
Companies covered by the regime could enjoy solid legal protection, which would guarantee respect for their acquired rights and protect them against possible non-compliance by the State. Together with the planned tax benefits, the RIGI would emerge as an attractive instrument to encourage long-term investments.
An aspect that is relevant is the requirement to present an affidavit of non-distortion of the local market, accompanied by a technical analysis of the effects of the investment in the relevant market. This mechanism would help ensure that investments, in addition to promoting development, do not generate adverse impacts on competition.
In short, the RIGI is presented as a strategic opportunity for large investors, offering a robust legal framework guaranteeing stability, transparency and state support, thus promoting growth and productive development in Argentina.
Furthermore, if the provinces decided to replicate its implementation, this regime could facilitate the expansion of large-scale investments throughout the national territory, contributing to more equitable economic development.