05 Ene 24 Antitrust Law No. 27,442: modifications provided for in the Bill

Agustín Cerolini, Matías Ferrari, Natalia Artmann and Dana König

On December 27, 2023 the Bill for Bases and Starting Points for the Freedom of Argentines (the “Bill”) was introduced to the Argentine National Congress by the Executive Power (the “PEN” for its acronym in Spanish). Among the topics presented, the Bill proposes to repeal the current Antitrust Law No. 27,442 (the “Law”) and proposes a new version in Annex III to replace it.

In this sense, we detail below the most relevant modifications introduced by the Bill.

(i) Prohibited acts: prohibits agreements between competitors and unilateral acts, practices or conduct that have the object or effect of limiting, restricting, falsifying or distorting competition or access to the market in a way that may be harmful to the general economic interest. In this way, economic concentrations that present competitive problems, contemplated in this article by the Law, are not included in the general prohibition.

(ii) Absolutely restrictive collusive practices: includes a new practice, focused on demand: “Arranging directly or indirectly the refusal to satisfy purchase or sale of goods demands or the provision or contracting of services to one or more third parties”.

(iii) Dominant position: these practices are contemplated only in cases where the company enjoys a dominant position. Subsections (b) and (j) of the current Law are eliminated and a new subsection is included “Abusively initiate judicial, administrative or disciplinary proceedings against a competitor – current or potential – with the purpose of expelling it or preventing its access to a market, dissuade it from implementing alternative competitive strategies, or undermine its business or professional reputation”.

(iv) Economic concentration: it is expanded and clarified that – in terms of economic concentrations – a company is defined as any entity or part of it that is in a position to offer or demand goods or services, regardless of its legal organization and even with no legal personality.

(v) Prohibited economic concentration operations: those whose object or effect is or may be to constitute, protect or strengthen a dominant position, in contrast to the current Law that refers to the general economic interest.

(vi) Creation of the “Agencia de Mercados y Competencia”: the Agencia de Mercados y Competencia (the “Agency”) is created as decentralized and autonomous entity within the scope of the PEN in order to preserve and promote the correct functioning, transparency and the existence of effective competition.

(vii) Suspensive system: establishes a suspensive system for the notification of economic concentration operations before the Agency. Transactions must be notified prior to: (i) the date of execution of the act; (ii) the materialization of the takeover; or (iii) the acquisition of substantial influence, whichever occurs first.

(viii) Increase in the thresholds for notification: involves economic concentrations whose total turnover of the affected companies in the country exceeds 500,000,000 “Unidades Móviles”, as opposed to the current 100,000,000. The Bill does not establish an initial value of the “Unidades Móviles”.

(ix) Voluntary notification: voluntary notification for those concentrations that are not included in article 9 of the Bill is created, which may be carried out in advance or up to 15 days as from its implementation.

(x) Notification of transactions that do not comply with the notification thresholds: the Agency may request the notification of concentrations that do not exceed the requirements included in article 9 in advance or within 180 days if it determines that there are reasonable indicators to believe that the economic concentration operation can constitute, protect or strengthen a dominant position.

(xi) Advisory opinion: eliminates the reference to decisions in this regard being final.

(xii) Deadline: the deadline within which the Secretary of the Agency must rule is 60 days after being notified, if the information and background provided are correct and complete.

(xiii) Economic concentration operations. Challenge: economic concentration operations that have been notified and authorized cannot be challenged at administrative courts, whether those included in article 9 of the Bill and those voluntary notifications (in the latter case, after 180 days as from its implementation.

(xiv) Creation of the Competition Defense Court (the “Court”): the Court is created as a decentralized and autonomous body within the scope of the PEN, made up of 5 members appointed by the PEN. Likewise, the Court will select 15 external associate members to provide their opinion on certain actions planned by the Bill. Each member of the Court will serve for 5 years. The renewal of its members will be staggered, partially, and they may be re-elected only once. Among the functions of the Court will be the imposition of sanctions for anti-competitive conduct, as well as to settle appeals filed by notifying companies in cases of rejection or conditioning of economic concentrations.