The Incentive Regime for Large Investments (“RIGI”), created with the aim of attracting investments exceeding USD 200 million, also promotes the active participation of local Small and Medium-Sized Enterprises (“SMEs”) in the value chain of Single Project Vehicles (“SPVs”) enrolled in the regime.
Pursuant to Decree No. 749/2024, which regulates Title VII – Incentive Regime for Large Investments of Law No. 27,742 (the “Decree”), SPVs are required, for the development of their projects, to allocate at least twenty percent (20%) of the total investment amount earmarked for the payment of suppliers of goods and works to local suppliers.
Under the applicable regulations, a “local supplier” is defined as: (i) individuals with tax domicile in Argentina, and (ii) legal entities incorporated and domiciled in Argentina, provided that at least 51% of their share capital or controlling voting rights are held by individuals and/or legal entities with tax domicile in Argentina, and whose corporate purpose is to provide services or supply goods to one or more SPVs under the RIGI.
The Decree establishes a restriction regarding goods or works supplied by companies affiliated with the acquiring SPV, except where such companies are the only ones capable of meeting the demand for the required goods or services.
The benefits extend to suppliers of goods that need to import inputs and intermediate goods for industrial transformation resulting in the production of Capital Goods (“CG”) and/or IT and Telecommunications Goods (“ITG”).
In the case of service providers, the regime covers those that need to import finished CG/ITG goods for the provision of their services.
The regulations do not allow the supply of imported inputs or intermediate goods without an industrial transformation process that grants the product a new form.
The benefits available to suppliers of SPVs under the RIGI include:
- Exemption from import duties on inputs, parts, and capital goods.
- Exemption from statistical fees and destination verification charges.
- Exemption from other tax collection and withholding regimes on imports (VAT, additional VAT, Income Tax on imports) and Gross Turnover Tax (where the relevant province adheres to the RIGI and incorporates it as a benefit).
To access the benefits regime, applications must be submitted through the “Remote Procedures” (Tramites A Distancia: “TAD”) platform, including: supplier identification, evidence of legal status, identification of the SPVs, contractual relationship (agreement or letter of intent), a report issued by a certified industrial engineer, and detailed schedules of the goods to be imported.
Currently, there is no requirement for a “special enrollment,” as participation is formalized through the execution of a contract by one or more SPVs with a company that qualifies as a local supplier.
