Relevant News on the Renewable Energy Sector

On July 11th, 2019, Decree No. 476 (the “Decree”) of the National Executive was published in the Official Gazette, with relevant news regarding the renewable energy regime.

The Decree has partially amended Decree No. 531/2016 (regulating) Laws No. 26,190 and No. 27,191. Most relevant aspects of the Decree are summarized below:

  1. Simplification of the process to obtain the Inclusion Certificate

The Secretary of Government of Energy—in its capacity as enforcement authority of the renewable energy regime—is empowered to: (i) analyze and approve the renewable projects that may apply for the Inclusion Certificate; and (ii) grant, to each of the approved projects, amounts requested as tax benefits, without the prior intervention of the Secretary of Treasury. In addition, the Decree eliminates the Ministry of Treasury’s intervention which is now no longer required.

  1. Execution of Power Purchase Agreements (“PPAs”) with public-owned entities

The Decree entitles CAMMESA (Wholesale Electric Market Management Company) to enter into PPAs with public-owned entities (either national, provincial and/or City of Buenos Aires’ owned). Prior the Decree, such entities were allowed to execute PPAs with CAMMESA insofar they participated in public tender procedures. The Decree now allows them to execute PPAs without participating in those procedures, to the extent that the following requirements are met: (i) the generation facility is owned by such public entities; (ii) those projects are able to access better financing conditions in comparison with the ones that the Federal or Provincial State could access to; and (iii) the investment projects have a relevant impact in local development.

Assignment, transfer or subcontracting of the PPAs are forbidden.

The agreed price under the PPA must be in line with those arising from public tendering called by the Secretary of Government of Energy, which implies that these agreements must be entered on a market condition basis.

As of this measure, public-owned entities are now eligible to enter into PPAs: (i) within the term market (approved by Resolution No. 281/17), and/or (ii) directly with CAMMESA, either directly (based on the Decree) or after being selected as such after a competitive procedure is carried out.

  1. Expectations for the Round 4 of the RenovAr Program

Senior officers of the Secretary of Government of Energy have announced that they are working in the design of the future Round 4 of the RenovAr Program, which is expected to be officially launched on November 2019.

Unlike the other rounds of the RenovAr Program, this new round is believed to require the bidders, in addition to their generation projects, the execution of works for the extension of the transmission capacity of some main lines of the Argentine electricity sector.

For further information, please do not hesitate to contact either Nicolás Eliaschev, Javier Constanzó or Juan Pablo Filippini.

Vaca Muerta: The Contracting Process for the Construction of an Essential Natural Gas Pipeline has Begun

On July 10th, 2019, Decree No. 465 (the “Decree”), issued by President Macri, has been published in the Official Gazette. By means of the Decree, the Secretary of Government of Energy (the “SGE”) has been instructed to call a public national and international tender with the purpose of awarding a new natural gas transport license for a new facility. This new infrastructure project entails the design and construction of a natural gas pipeline that will connect the Neuquén’s Subzone with the cities of Salliqueló and San Nicolás, both located in the province of Buenos Aires.

Pursuant to the Decree, the new transport license shall include a special regime lasting 17 years as from commercial operation date. The main terms of this special regime are summarized below:

  1. The licensee’s remuneration shall be freely negotiated with the users of the gas pipeline;
  2. The licensee’s remuneration shall not impact in the natural gas residential end users’ rates;
  3. The terms and conditions of the tender to be called by the SGE shall provide a partial award of pipeline’s capacity. The remaining capacity shall be assigned through public tenders, in compliance with the applicable regulations.

Finally, the Decree provides that Law No. 24,076 -that rules natural gas’ transportation and distribution-, shall be the project’s legal framework, instead of the Law No. 17,319 -that recognizes the operating concessionaire’s right to transport its hydrocarbons-. However, as long as the special regime remains effective, Law No. 24,076, Title IX, Chapter I provisions to the extent they contradict the Decree, shall not be applicable.

For further information, please do not hesitate to contact either Nicolás Eliaschev, Javier Constanzó or Juan Pablo Filippini.

20 Minute Insight

📺 👉🏼 Our partner Nicolás Eliaschev was interviewed by Jamie Dowswell, Programme Director of AIREC, about the outlook for Argentina's Renewable Energy Sector for this year.

Regulatory Updates: New Terms and Conditions for Hydrocarbon Transport Concession's Public Tendering

On July 1st, 2019, Resolution No. 357 (the “Resolution”), issued by the Secretary of Government of Energy (the “SGE”), has been published in the Official Gazette, with important implications in regards to public tendering procedures which shall be carried out in order to grant concessions for hydrocarbon’s transportation. Tenders of this nature may rely on project’s submitted by private entities, as further described below.

Pursuant to Annex I of the Resolution, those tenders may comprise:

  1. Concessions for hydrocarbon’s transportation, which have been reverted from the former concessionaire to the pertaining governmental body or entity.
  2. Projects submitted by private entities, which shall contain minimum standards such as a general description of the project’s nature and aspects involved in its execution, land matters, etc.
  3. New hydrocarbon transportation projects required to satisfy demands of the users.

The Resolution also foresees that all public tenders launched by the SGE in order to grant a hydrocarbon transport concession shall contain a bid document containing main terms and conditions of such competitive procedure.

In addition the Resolution further stipulates requires that all projects submitted by any private entity to the relevant governmental authorities must clearly specify land matters-related issues involved in such project.

The Resolution also authorizes foreign corporations (not registered in Argentina’s registries of commerce as of the date on which the Resolution is issued) to submit proposals of this nature for purposes of being evaluated and subject to a public tendering thereafter. However, foreign entities are bound to register before the mentioned registries’, to the extent that their proposal is admitted and prior to the public tender being issued.

Furthermore, the Resolution indicates that the governmental authorities shall provide their ruling regarding project’s feasibility no later than thirty (30) business days from the project being submitted thereof.

Finally, the Resolution requires prior registration of the interested companies before the Hydrocarbon Transport Registry for their participation in the public tenders.

For further information, please do not hesitate to contact either Nicolás Eliaschev or Javier Constanzó.

Changes to the Fair Trading Act: extension of the unfair competition acts

On April 22th 2019, the necessary and urgent decree No. 274/2019 was published on the Official Gazette, by virtue of which Law No. 22,802 (the “Fair Trading Law”) was abrogated, and a new rule of law regarding fair trade was enacted (the “Decree”) which shall enter in force as from April 30th 2019.

The purpose of the Decree is to ensure fairness and transparency in commercial relationships and the access to essential information of products and services that are commercialized, through physical or digital means, extending the previous provisions contained in the Fair Trading Law.

The Decree is divided into a preliminary title and 8 titles which regulate: (i) unfair competition; (ii) advertising and promotions; (iii) trade information; (iv) enforcement authority, administrative procedures, as well as the remedies and sanctions; (v) legal actions; (vi) general provisions; (vii) consumer protection; and (viii) final provisions.

The main change that the Decree includes is the enumeration of acts that constitute an unfair competition,: (i) acts of deception; (ii) acts of confusion; (iii) breach of legal regulations; (iv) abuse of a depending economic situation; (v) Improperly obtaining of commercial conditions; (vi) sale below cost; (vii) improper exploitation of others’ reputation; (viii) acts of unfair imitation; (ix) acts of denigration; and (x) violation of secrets. The Decree defines in its article No. 10 unfair competition in a very broad way and systematically includes situations that shall constitute an unfair competition, such as acts of denigration, violation of secrets and the improper exploitation of others’ reputation. Such situations shall be deemed exhaustive, for the purposes of the imposition of sanctions by the Secretariat of Internal Commerce of the Ministry of Production and Labor, acting as the enforcement authority, and enunciative for the purpose of promoting legal actions by affected ones. With the Decree, the maximum amounts of the fines are substantially increased to an amount of 10,000,000 mobile units (approx. AR$ 264,000,000), the procedural rules for infringements are established and new legal actions are provided for those affected by unfair competitions acts.

Additionally, the requirements for the identification of products commercialized, the provisions for misleading advertising, and the regulations on sales promotions that contain pizers or gifts, among other issues, are maintained.

Regarding advertising as unfair competition, a definition of comparative advertising is incorporated, which states that advertising is to be considered comparative when explicitly or implicitly refers to a competitor, its brand or the products or services offered by it.

Additionally, the Decree incorporates to the Consumer Protection Law No. 26,993 (the "Consumer Protection Law"), article 1 bis, which provides the inclusion of the Electronic Dispute Resolution System, as a previous, optional and free procedure for users and consumers. for access to the Prior Reconciliation Service in Consumer Relations (COPREC for its acronym in Spanish), through which the individual or collective consumers and users’ claims shall be resolved, instructing the authority of the Consumer Protection Law to regulate its scope.

Finally, it should be noted that the provisions of the Decree are considered to be public policy rules, as stated in article 2; the principles of the national administrative proceedings law o No. 19,549 are applicable to the procedure provided in the Decree; and that the provisions of the National Civil and Commercial Code shall apply.

Any further information, please do not hesitate to contact Juan Pablo Bove, Federico Otero, Julián Razumny, or

Simplification of requirements for foreign companies

On April 3rd, 2019, the National Securities Commission (the "CNV") issued General Resolution Nº 789/2019. It amended prior CNV rules in order to facilitate the registration processes with this authority.

In such respect, CNV established that:

  • the attendance of an attorney in fact duly authorized will suffice for a foreign company to participate in a shareholder meeting. In this regard, an attorney in fact shall be considered duly authorized as follows:
    • the legal representative appointed for the Argentine Republic;
    • any person with a power granted by the legal representative in the Argentine Republic or by a person authorized in accordance with the rules of the country of origin under the terms of Section 239 of the Law Nº 19,550; and
    • any person with a power granted abroad by an authorized person in accordance with the legal requirements of the country of origin and with applicable rules for foreign documents in Argentina.
  • Furthermore, companies whose register of entry shares were issued in accordance with Section 208 of the General Corporations Law, may replace the Stock Registry Book and the Book of Assembly Attendance traditional paper format by a new computerized system by applying for an authorization before the CNV. The original documents must be kept in paper format at the registered office.

Any further information, please do not hesitate to contact Juan Pablo Bove, Federico Otero, Julián Razumny, or

New works and expansion of existing infrastructure – Neuquén basin gas pipeline and PPP Power transmission

On March 8, 2019, two resolutions issued by the Secretary of Government of Energy (the “SGE”), containing relevant rules in connection with infrastructure works of the electricity and gas industries, were published in the Official Gazette:

(1) Resolution SGE No. 81/2019 (“Resolution 81”), related to the construction and further operation of the 500-kV high-voltage line, the future substations Río Diamante and Charlone, and complementary works, under a public-private partnership structure (“PPP”). By means of this Resolution 81, call for bids set out in 2018 have been relaunched; and

(2) Resolution SGE No. 82/2019 (“Resolution 82”), related to the construction of a new gas pipeline or the significant expansion of existing transport capacity for the transportation of natural gas produced in the Neuquén basin towards the metropolitan area of the province of Buenos Aires.

The most relevant aspects of both resolutions are summarized below:

  • Resolution SGE No. 81/2019 – PPP Power transmission works

    Resolution 81 calls for a two-stage national and international tender procedure for the construction and further of the 500-kV high-voltage line, the future substations Río Diamante and Charlone, and complementary works.

    Such works also comprise the electrical interconnection in 500-kV of the future substations Río Diamante, Charlone, and complementary works, as well as operation and maintenance of these facilities.

    The tender’s terms and conditions and its annexes are published on the website of the Undersecretary of Public-Private Partnership, together with the rest of the preliminary tender documents.

    The most important dates to keep in mind are:

    Date and time Activity
    May 10, 2019 Public consultation period due date
    May 27, 2019 Deadline for bids
    June 27, 2019 Publication of the Prequalification Ruling (Dictamen de Evaluación de Precalificación)
    July 2, 2019 Opening of envelope no. 2
    July 10, 2019 Publication of the Economic Offers’ Evaluation Ruling (Dictamen de Evaluación de las Ofertas Económicas)
    July 12, 2019 Resolution awarding PPP Contract
    August 14, 2019 Due date for PPP Contract execution

  • Resolution SGE No. 82/2019 – Vaca Muerta gas pipeline

    Resolution 82 calls for expressions of interest in connection with: (i) the construction of a new gas pipeline; or (ii) the development of a significant expansion of the current transport capacity.

    Expressions of interests aim to enhance transportation of natural gas produced in the Neuquén basin towards the metropolitan area of the province of Buenos Aires and the littoral area.

    Interested parties in participating in this procedure shall submit their expressions of interest no later than April 8, 2019.

    1. Scope

      With respect to the construction of a new transport system, a public tender procedure for the construction, operation and maintenance of the new infrastructure shall be called on a later stage.

      Capacity expansions of one or all existing transport systems shall be authorized in accordance with section 16 of law No. 24.076. Expansions which generate an additional capacity of 10 MMm3/d shall be considered as “significant expansions”.

      In all scenarios a technical description of the proposed project shall be issued. Such description must include the necessary works, design, nominal transport capacity to be added and construction and launch dates. Moreover, information to evaluate the potential demand associated to the project shall be issued.

    2. Rate structure

      Interest parties may propose a rate scheme applicable for the new facilities.

      For expansions, criteria set forth in Resolution No. 1483 issued by the Ente Nacional Regulador del Gas (ENARGAS) shall be applicable (incremental cost criteria).

    3. Access to the facilities by third parties

      Open access and no third-party discrimination shall be applicable. Moreover, long-term agreements with parties acting as gas traders may be executed, in the event that the proposed rate scheme requires so.

Desde TRSyM, estamos siguiendo este proceso con mucha atención y estamos a disposición para ampliar cualquiera de los puntos aquí tratados.

RenovAr 2 Program: Extension of intermediate milestones and COD

On February 19, 2019, Resolution No. 52/19 (hereinafter, the “Resolution”), issued by the Secretary of Government of Energy, has been published in the Official Gazette, with significant relevance towards Power Purchase Agreements (“PPA”) awarded under RenovAr 2.

This Resolution states the goal to facilitate the construction and successful commercial operation date (“COD”) of all projects acting within RenovAr 2, and therefore allows for extension of dates committed under the PPA (intermediate milestones and COD) insofar certain conditions are met, as further detailed below.

In order to apply for an extension of intermediate milestones, pertaining filings before the relevant authorities must be performed no later than April 30, 2019. COD extension shall be requested 15 business days in advance as from the original date committed for such milestone.

Below you may find an outline of most relevant aspects set forth in the Resolution:
1) Extension of PPA intermediate milestones

Upon the issuance of this Resolution, owners of RenovAr 2 projects may require an extension of 180 days of each intermediate milestone under the PPA.

Said extension of time sets forth a mandatory prior increase of the PPA Compliance Bond in force at that time, on an amount equal to thirty percent (30%) of the guarantee’s original amount. Should prior increases have been performed, the guarantee may be reduced up to the original amount plus such thirty percent (30%).

The Resolution also foresees that if such intermediate milestone elapses (including 180 day-extension) the guarantee shall also be increased in a twenty percent (20%) per milestone, over the guaranteed amount at such time.

Filings in order to apply for these extensions must be performed no later than April 30, 2019, while the increase of the compliance bond shall be in place before the execution of the relevant addendum of the PPA.
2) Extension of COD

COD may also be extended pursuant to the terms of this Resolution, for a maximum term of three hundred and sixty-five (365) days further to the original date committed for such milestone. Two of the following three conditions shall be met in order to benefit from an extension in COD:

  1. Achieve thirty percent (30%) of Stated Local Content (“SLC”). This condition shall be considered as fulfilled for those projects that have already committed, at least, said percentage of SLC under their PPAs. Penalties equal to forty per cent (40%) of the monthly billing under the PPA shall be applied for each percentage point of deficiency in the compliance with the SLC. Additionally, a reduction of the PPA’s term and of the Incentive Factor, in accordance with the conditions settled below, shall apply.
  2. Reduction of the PPA tenor: accept a proportional reduction of the PPA tenor equal to six times the amount of days that COD is extended (e.g. if the new COD is 360 days after original COD was committed, PPA should be reduced in almost six years).
  3. Reduction of the Incentive Factor in accordance to the formula set out therein

If COD has yet not been achieved (as this date may be extended pursuant to the above), the PPA’s cure period of one hundred and eighty (180) days shall apply (notwithstanding the obligation of paying penalties under the PPA). In case the project does not achieve its COD within said cure period, an additional cure period of extra one hundred and eighty (180) days will be applicable in accordance to Resolution No. 285/18.

COD extension must be requested fifteen (15) business days in advance of the original COD before CAMMESA. For those projects which COD is on or before March 15 2019, the referred filing shall be performed no later than March 29, 2019.
3) Execution of pending PPAs

Finally, the Resolution foresees, for those RenovAr 2 projects that have not yet executed their PPAs, the possibility to do so. Two of the following three conditions must be selected:

  1. Achieve thirty percent (30%) of SLC. Penalties equal to fifty per cent (50%) of the monthly billing under the PPA shall applied for each percentage point of deficiency in the compliance with the SLC. Additionally, a reduction of the PPA’s term and of the Incentive Factor, in accordance with the conditions settled below, shall apply.
  2. Reduction of the PPA tenor: in six (6) years, resulting in a new tenor of fourteen (14) years.
  3. Elimination of the Incentive Factor in accordance to the form settled by the Resolution.

The PPA’s execution shall be done on or before April 30, 2019 and it shall be requested before CAMMESA ten (10) business days in advance.

For these PPAs, intermediate milestones shall be calculated since June 1, 2018, notwithstanding IPPs right to request for an extension of these dates as described above.

Finally, the Resolutions enables to change the Strategic Partner under the PPA. Said change shall be requested fifteen (15) days in advance to April 30, 2019.

New guidelines applicable to the Data Protection Act

On January 16, 2019, the Argentine Data Protection Agency (the “Agency”) enacted Regulation No. 4/2019 (the “Regulation”) which established new guidelines to be applied to the Personal Data Protection Law No. 25,326 (the “Data Protection Act”), in order to enhance its implementation.

In this sense, the main relevant provisions implemented by the Agency are as follow:

  • personal data owners may access to their data acquired through video surveillance, provided that, their identity is duly certified. If their request were rejected, they shall be noticed about the possibility to file a claim with the National Direction for the Personal Data Protection;
  • if the recorded image identifies any other third party, the data holder shall apply a decoupling technic in order to assure that only the data owner will be identifiable;
  • the data owner shall have the right to request a disclosure regarding the applicable logic in those cases in which negative legal effects, or if any other significative negative consequence, may emerge from decisions based on automatic treatment of personal data;
  • biometric data identifying a person shall be deemed sensible only if it may result discriminatory to the data owner;
  • data holder shall implement valid and effective identification mechanisms;
  • in relation to the assignment of personal data among public offices, certain scenarios were defined in which prior consent of the data owner shall not be necessary; and
  • underage may consent the treatment of their personal data, under certain conditions.

Any further information, please do not hesitate to contact Juan Pablo Bove, Federico Otero, Julián Razumny, or

Financial Statements´ reporting in constant currency

The enactment of Law N° 27,468 on November 15th, 2018 reestablished the effectiveness of previously abrogated Section 62 (in fine) of General Corporations Law N° 19,550 that sets forth that interim and annual financial statements are required to be reported in constant currency and delegated in the Public Registry of Commerce (“IGJ”) its effectiveness date.

In such respect, IGJ´s issuance of General Resolution N° 10/2018 (the “Resolution”) on December 28th, 2018 reestablished the effectiveness of such obligation and additionally amended General Resolution Nº 7/2015 in the following related matters:

  • financial statements must be filed in constant currency (except those issued by entities subject to special control regimes)
  • financial statements shall be restated in accordance with the regulations issued by the Argentine Federation of Professional Councils of Economic Sciences (FACPCE) and adopted by the Professional Council of Economic Sciences of the City of Buenos Aires (CPCECABA);
  • the decisions to be adopted by governance bodies must be taken with accounting information in constant currency;
  • all restatements must be expressed in their actual value;
  • companies subject to the Public Registry of Commerce’s control that are controlling, controlled or affiliated to other companies subject to oversight by the National Securities Commission may adopt specific regulations applicable to the latter, explaining the reasons in the financial statements.

Any further information, please do not hesitate to contact Juan Pablo Bove, Federico Otero, Julián Razumny, or