Dear Sir or Madam,
Under Argentina’s Competition Act N°27,442 (the “ACA”), the obligation to notify a transaction for merger control has a limited number of exceptions. The exception that is applied most often in practice is the so called “first landing” exception.
Section 11 par c) of the ACA establishes that this exception applies when a single foreign entity that does not own shares of Argentine companies or Argentine assets and has not made frequent and significant sales in Argentina during the previous 36 months, acquires a single Argentine entity. Recent case law, however, has extended the scope of application of this exception.
Advisory Opinion N°221 (OPI 296), of October 7th, 2017, establishes that the use of an Argentine entity -an “Argentine Company”- controlled by a foreign purchaser as a vehicle for the purposes of the transaction does not prevent the application of the first landing exception; as long as the vehicle does not have activity or own Argentine assets.
Advisory Opinion N°240 (OPI 295), of October 30th, 2017, goes one step further. It establishes that the use of an Argentine vehicle incorporated for the purposes of making an investment does not prevent the application of the first landing exception irrespective of whether it was incorporated for the purposes of the transaction or not, or whether it was incorporated some time before the transaction (also as long as the vehicle does not have activity or own Argentine assets).
Advisory Opinion N°312 (OPI 312), of December 14th, 2018, finally, accepts that the first landing exception applies even if the buyer uses a local vehicle that owns some assets that are not significant (in the case reviewed, the vehicle had three employees that rendered services for foreign affiliates); as long as it does not have any activities in Argentina.
Should you require any further information on this matter, please do not hesitate to contact us.