Diego Krischcautzky Barbara V. Ramperti July 6 2016 Major reforms likely to boost M&A activity Marval O'Farrell Mairal | Corporate Finance/M&A - Argentina Diego Krischcautzky, Barbara V. Ramperti Corporate Finance/M&A IntroductionEasing restrictionsCommentIntroductionArgentina is slowly, but decisively, leaving behind a decade of over-regulation. During the 2010s local and foreign economic agents in all sectors were directly or indirectly subject to a high level of legal and factual regulation, which significantly complicated and, in some cases, restricted the establishment and development of business. Further, foreign direct investment in Argentina lagged behind not only Brazil and Mexico, but also smaller economies such as Chile, Colombia and Peru. M&A activity suffered as a result.Easing restrictionsFollowing the 2015 presidential election and the resulting change of administration last December, some restrictions were lifted or eased, such as those relating to the foreign exchange control regime, which had effectively been an obstacle to international trade and the flow of dividends, interests, royalties and services. Earlier this year, the country stepped out of its 13-year default through an agreement with holdout bondholders, thus clearing the path for the return to public and private international capital markets and paving the way for a return of corporate finance.A relevant bill has already been approved by Congress. It contains a reform of the pension system and a tax amnesty, which is expected to be the final amnesty before Argentina begins exchanging tax information with other countries. The tax amnesty will include tax-free incentives for those investing in real estate and other productive activity-dedicated investment funds.A major reform of the antitrust legal framework is also expected, which will drastically reduce the two-and-half to three-year waiting time to obtain antitrust clearance and introduce a fast-track mechanism providing the relevant parties with greater certainty when closing a transaction. Further, the thresholds in place will be substantially increased. This will reduce the number of transactions subject to antitrust clearance.Other proposed changes include:easing the restrictions on foreign nationals owning property in Argentina;the creation of a new public-private association regime; andthe grant of incentives to renewable energy generators.CommentAs the country endeavours to make the transition from over-regulation to a private investment-friendly environment, expectations in the M&A sector are high. If the high-inflation and low-growth transition is overcome in the next few months, Argentina should regain significant attractiveness in the region and appeal to local and foreign investment.For further information on this topic please contact Diego Krischcautzky or Bárbara Ramperti at Marval, O'Farrell & Mairal by telephone (+54 11 4310 0100) or email ([email protected] or [email protected]). The Marval, O'Farrell & Mairal website can be accessed at www.marval.com.ar.