Investigations by the Commerce Secretariat
Legality of affidavits
On January 10 2012 the Argentine tax authorities passed General Resolution 3252/2012, requiring importers to file an advance import affidavit before the definitive import of any type of goods. The affidavit is analysed by the tax authorities and by any other relevant government agency; only once approval has been granted may the import be carried out (for further details please see "Argentina keeps restricting imports"). The resolution applies to all types of product definitively imported into the country as from February 1 2012.
Under the resolution, importers must file an affidavit (through the tax authority's website) before issuing a purchase order or similar document. The authority will inform importers (through its online application) of any news regarding the status of their petition and, if applicable, the reasons for any objections made and the government agencies where importers can remedy those objections. Importers must enter the affidavit number in the authority's María Information System when the goods enter customs clearance. The customs clearance process will be automatically stopped if this number is not entered.
On January 23 2012 the authority issued General Resolution 3255/2012 further regulating the affidavit process.
The agencies that have adhered to the system have a 72-hour period (from the date on which the affidavit is filed by the importer) to make any comments. This time period may be extended by up to 10 calendar days in "those cases in which the specific activities of the agency in charge so requests". Once the above periods have elapsed with no comments being made, the import operation may continue. Otherwise, the comments should be dealt with by the importer with the agency that raised them. The Commerce Secretariat (the first agency to implement the system) has set itself a limit of 15 working days in which to commence an investigation resulting from any comments (through Resolution SCI 1/12). This period may be deemed abrogated by Resolution 3255/2012; however, this issue has not yet been settled.
Import operations that already have an open irrevocable letter of credit (or similar document) or that have been prepaid (in both cases dating from before February 1 2012) are exempt from the obligation to obtain an affidavit. However, there are some contradictions in the text of the resolution that may create problems at the time of applying this exemption. The following import operations, among others, are exempt from the obligation to obtain an affidavit:
- imports made under the courier or sample regimes;
- imports that relate to turnkey projects (provided that they were approved before February 1 2012); or
- imports that are sent in different shipments (provided that they were approved before February 1 2012).
The following data must be supplied by the importer when filing the corresponding import declaration:
- the unique tax identification number;
- the free on board (FOB) value and foreign currency involved;
- the tariff item number of the goods to be imported;
- the type and quantity of the goods;
- the condition of the goods;
- the country of origin; and
- the country of provenance.
The affidavit will be valid for 180 days from the date of issuance; this period may be extended.
When filing the affidavit request, the importer will be informed of the agencies that will be taking part in the approval process.
This system has been in place for just over one month. Based on market rumours, around 40% to 50% of all imports have been investigated by the Commerce Secretariat (although others talk of just 20% of imports being investigated). The process for dealing with these investigations has not yet been regulated, giving rise to complaints by the importers affected. This is the latest protectionist measure to be taken by the government. Companies and industry associations are following the situation on a daily basis, but there is no clear path to resolve any investigations resulting from comments made by the secretariat. Those imports that have not been investigated have been processed as usual, with only the minor delay mentioned above.
Investigations by the Commerce Secretariat
The regulations are clear that if no comments are made within 10 calendar days, the import clearance process should continue. However, the regulations are unclear as to the procedure to be followed when a comment is received from one of the intervening agencies.
The most notable case relates to investigations by the Commerce Secretariat, one of the agencies that has so far implemented the system.(1)
The Commerce Secretariat has not published regulations on the procedure to be followed by an importer whose request for an affidavit has been investigated by the secretariat.
Expected unregulated procedure
According to information published in the press and other sources, the unregulated procedure would be as follows.
Once an importer has been informed, through the María Information System, that an investigation has been commenced by the Commerce Secretariat, the importer must file a letter addressed to the secretariat containing the following information:
- a forecast of imports and exports (from their FOB value) for 2012 and, if the balance of the forecast is negative (ie, imports are expected to be higher than exports), the reasons for such negative balance;
- a price list of all products sold by the importer as of December 2010, December 2011 and January 2012;
- a chart comparing the evolution of the prices throughout the above period, including the percentage price increases from one period to another;
- the personal business card of the importer's contact person; and
- a compact disc containing the information detailed above.
This documentation must be filed with the Fair Trade Practices Directorate, which reports to the secretariat. The above presentation must be followed up by sending an email addressed to the secretariat,(2) informing that the above presentation has taken place and requesting that the affidavit be authorised. Furthermore, companies with a negative trade balance should contact the secretary to the Commerce Secretariat by email,(3) attaching a copy of the presentation.
Based on the information available, there is no clear timetable for obtaining an answer from the secretariat to the presentation outlined above, nor on the parameters that will be taken into consideration by the secretariat to resolve any investigations. According to market rumours, the secretariat will remove any comments attached to the affidavits of a particular importer only if the importer commits to:
- achieve an even trade balance (by means of either an increase of exports, a reduction of imports, a combination of both or any other measure with similar effects); or
- reduce its trade deficit substantially.
Based on the World Trade Organisation (WTO) agreements and on international and local case law, certain preliminary conclusions may be reached with respect to the legality of the affidavits. Although affidavits are not illegal per se under the WTO agreements, any import licensing regime must be administered in a transparent and non-discriminatory way, so as to avoid erecting a new trade barrier. As the regulations establishing the affidavits are drafted, there are already grounds to argue that they are in breach of the WTO agreements (eg, the lack of transparency of the investigative procedure).
However, in spite of this, and based on the experience of the prior litigation in Argentina against non-automatic import licences (which in practice have a similar procedure and effect to the affidavits), the courts may prefer to have a sense of how the system works in practice before declaring it unconstitutional. In general, courts are reluctant to declare a regulation unconstitutional, preferring to deal with specific factual circumstances on a case-by-case basis.
For the reasons mentioned above, importers are attempting to comply with the requirements of the Commerce Secretariat. This means that importers with a negative trade balance are submitting proposals to the secretariat in order to remedy this situation. As explained, there is no formal regulation establishing that importers must have an even trade balance or that every import must be matched by an export of equal value. This is something that has been requested by the secretariat on an informal basis as a precondition for resolving investigations.
At present, the foreign trade sector of Argentina is almost paralysed, with no clear sense of direction. Only time will tell whether the affidavit system starts processing requests relatively smoothly, or if the paralysis will result in an increase in litigation by desperate importers.
For further information on this topic please contact Esteban P Rópolo at Baker & McKenzie SC by telephone (+54 11 4310 2200), fax (+54 11 4310 2299) or email ([email protected]).
(1) The others include the National Administration of Drugs, Food and Technology and the National Animal Health Service, plus other administrative agencies with jurisdiction over certain types of import.
(2) Emails should be sent to [email protected].
(3) Emails should be sent to Ana Gonzalez at [email protected].