RURAL LANDS Law 26.737
Regime for the Protection of National Sovereignty over the Ownership, Possession or Tenure of Rural Lands.
Enacted: December 22, 2011, Promulgated: December 27, 2011, The Senate and Chamber of Deputies of the Argentine Nation, meeting in Congress, etc., enact with the force of law:
REGIME FOR THE PROTECTION OF NATIONAL SOCIETY OVER THE OWNERSHIP, POSSESSION OR TENURE OF RURAL LANDS
CHAPTER I – Territorial and Personal Scope of Application of the Law
ARTICLE 1 — This law is in force throughout the territory of the Argentine Nation, with the character of public order. This law must be observed, according to the respective jurisdictions, by federal, provincial, and municipal government authorities, and will apply to all natural and legal persons who, directly or indirectly, possess rural lands, whether for agricultural, forestry, tourism, or other uses or production. For the purposes of this law, rural lands shall be understood to mean any property located outside the urban area, regardless of its location or intended use.
CHAPTER II – Purpose
ARTICLE 2 — The purpose of this law is: a) To determine the ownership, cadastral and legal status, of the possession of rural lands, under any title or de facto situation, and to establish the obligations arising from the ownership or possession of said lands, in accordance with the provisions of this law; b) To regulate, with respect to foreign natural and legal persons, the limits on the ownership and possession of rural lands, whatever their intended use or production.
CHAPTER III – On the limits to foreign ownership or possession of rural lands
ARTICLE 3 — For the purposes of this law, foreign ownership or possession of rural lands shall be understood as any acquisition, transfer, or assignment of possessory rights, whatever the form, name given to it by the parties, and its duration, in favor of: a) Natural persons of foreign nationality, whether or not they have their actual domicile in the territory of the Argentine Nation, with the exceptions established in Article 4 of this law; b) Legal persons, according to the framework provided in Article 32 of the Civil Code, constituted in accordance with the corporate laws of the Argentine Nation or of a foreign country, whose share capital, in a proportion greater than fifty-one percent (51%), or in the proportion necessary to form a majority social will regardless of the percentage of shares, is owned by natural or legal persons of foreign nationality, under the conditions described in the preceding paragraph. Any modification of the shareholding structure, whether by public or private instrument, must be reported by the legal entity to the National Registry of Rural Lands within thirty (30) days of the transaction, for the purpose of verifying compliance with the provisions of this law. This provision also includes: 1. Legal entities, regardless of their corporate structure, that are controlled by any foreign corporate or cooperative entity, as defined in this law, with a percentage greater than twenty-five percent (25%), or that hold the necessary votes to form a majority decision, regardless of their shareholding percentage. 2. Foreign natural or legal persons who, without formally demonstrating their status as shareholders, act in a company as if they were. 3. Companies that have issued negotiable bonds or debentures, allowing their legitimate holder to increase their shareholdings or convert them into shares by a percentage exceeding twenty-five percent (25%), or allowing them to form a majority corporate will regardless of their shareholding percentage, and are foreign natural or legal persons, in accordance with the definitions established in this law. 4. When ownership is transferred, under any of the forms provided for in current laws, by virtue of a trust agreement, and whose beneficiaries are foreign natural or legal persons in a percentage greater than that authorized in the preceding paragraph. 5. Joint ventures, collaborative groups, and temporary business associations, as regulated by the Companies Law, and any other form of business collaboration of an accidental and provisional nature that may be regulated in the future, when foreign natural or legal persons participate in them in a percentage greater than that authorized in this law; c) Public legal persons of foreign nationality; d) Simple associations as defined in Article 46 of the Civil Code or de facto companies, under the same conditions regarding their share capital as those provided for in subsection b) of this article.
ARTICLE 4 — The following foreign nationals are exempt from the application of this law: a) Those with ten (10) years of continuous, permanent, and verifiable residence in the country; b) Those who have Argentine children and demonstrate five (5) years of continuous, permanent, and verifiable residence in the country; c) Those who have been married to an Argentine citizen for five (5) years prior to the establishment or transfer of the relevant rights and demonstrate continuous, permanent, and verifiable residence in the country for the same period.
ARTICLE 5 — The regulations will determine the requirements that foreign nationals and legal entities must meet to demonstrate compliance with the provisions of this law, and the implementing authority will be responsible for its control and enforcement.
ARTICLE 6 — The use of Argentine citizens or legal entities incorporated in Argentina as intermediaries to create a fictitious Argentine ownership structure to circumvent the provisions of this law is prohibited. This shall be considered an unlawful and fraudulent simulation.
ARTICLE 7 — All legal acts executed in violation of the provisions of this law shall be null and void, without any right to compensation for the benefit of the perpetrators and accomplices of the unlawful act. For the purposes of this provision, accomplices shall be considered to be those who transfer the land or execute public or private instruments that constitute the unlawful act, and they shall be jointly and severally liable with their assets for the harmful consequences of these acts. The enforcement authority is empowered to examine legal acts according to their true nature, without being bound by the name given to them by the parties executing them.
ARTICLE 8 — A limit of fifteen percent (15%) is established for all ownership or possession of rural lands within the national territory, with respect to the persons and situations regulated by this chapter. This percentage shall also be calculated on the territory of the province, municipality, or equivalent administrative entity in which the rural property is located.
ARTICLE 9 — In no case may natural or legal persons of the same foreign nationality exceed thirty percent (30%) of the percentage assigned in the preceding article to foreign ownership or possession of rural lands.
ARTICLE 10 — Rural lands belonging to a single foreign owner may not exceed one thousand hectares (1,000 ha) in the core zone, or an equivalent area, depending on the territorial location. This equivalent area shall be determined by the Interministerial Council for Rural Lands provided for in Article 16 of this law, taking into account the following parameters: a) The location of the rural lands and their proportion with respect to the municipality, department, and province they comprise; b) The capacity and quality of rural lands for their use and exploitation. For the purposes of granting the authorization certificate, the implementing authority shall verify the amount of rural land owned or held by the acquiring person. Furthermore, the ownership or possession of the following properties by foreign persons, as defined in Article 3 of this law, is prohibited: 1. Properties that contain or border significant and permanent bodies of water. 2. Properties located in border security zones, with the exceptions and procedures established by Decree-Law 15,385/44, as amended by Law 23,554.
ARTICLE 11 — For the purposes of this law and taking into account the Bilateral Investment Treaties (BITs) signed by the Argentine Republic and in force on the date of entry into force of this law, the acquisition of rural lands shall not be considered an investment, as it is a non-renewable natural resource provided by the receiving country.
ARTICLE 12 — Owners or possessors of rural lands, whether natural or legal persons, who are foreign nationals, must, within one hundred and eighty (180) days from the date the regulations of this law enter into force, report the existence of such ownership or possession to the National Registry of Rural Lands, as provided for in Article 14.
ARTICLE 13 — The acquisition of rural property located in a security zone by a person covered by this law requires the prior consent of the Ministry of the Interior.
CHAPTER IV On the National Registry of Rural Lands
ARTICLE 14 — The National Registry of Rural Lands is hereby created within the Ministry of Justice and Human Rights, with the participation of the Ministry of Agriculture, Livestock and Fisheries, which shall be the implementing authority with the following specific functions: a) To maintain the registry of data concerning rural lands owned or possessed by foreigners, as defined in this law; b) To request from the competent provincial agencies responsible for registration, cadastral surveys, and the registration of legal entities, the information necessary for the performance of its functions; c) To issue certificates authorizing any act by which ownership or possession rights over rural lands are transferred in the cases covered by this law. The certificates authorizing such acts shall be regulated by the regulations implementing this law and shall be processed by the notary public or intervening judicial authority. d) To exercise control over compliance with this law, with standing to prevent, in administrative proceedings, or to claim the nullity in judicial proceedings, of acts prohibited by this law.
ARTICLE 15 — A cadastral, ownership, and legal entity registry survey shall be carried out to determine the ownership and possession of rural lands, in accordance with the provisions of this law, which shall be carried out within one hundred and eighty (180) days of the creation and implementation of the National Registry of Rural Lands.
CHAPTER V On the Interministerial Council for Rural Lands
ARTICLE 16 — The Interministerial Council for Rural Lands is hereby created. It shall be chaired by the Ministry of Justice and Human Rights and composed of the Ministry of Agriculture, Livestock and Fisheries, the Secretariat of Environment and Sustainable Development of the Chief of the Cabinet of Ministers, the Ministry of Defense, and the Ministry of the Interior, with representatives from the provinces. Its functions shall be: a) To direct actions for the implementation of this law; b) To implement the national policy on rural lands; c) To seek the collaboration of agencies of the centralized and decentralized administration of the national government and the provinces; d) To determine the equivalence of areas of the national territory referred to in Article 10 of this law, based on technical instruments prepared by the competent official agencies.
ARTICLE 17 — This law does not affect acquired rights, and its provisions shall enter into force on the day following its publication.
ARTICLE 18 — Transitional Clause: Any acquisition, transfer, or assignment of possessory rights, regardless of the form, name, or duration imposed by the parties, in favor of foreign natural or legal persons, as defined in Article 3, carried out during the period between the entry into force of this law and its regulation by the National Executive Branch, shall be subject to the provisions of this law and the consequences set forth in Article 7.
ARTICLE 19 — Let it be communicated to the National Executive Branch.
GIVEN IN THE SESSION HALL OF THE ARGENTINE CONGRESS, IN BUENOS AIRES, ON THE TWENTY-SECOND DAY OF DECEMBER OF THE YEAR TWO THOUSAND ELEVEN. — REGISTERED UNDER No. 26,737 — AMADO BOUDOU. — JULIAN A. DOMINGUEZ. — Gervasio Bozzano. — Juan H. Estrada.
Translated by Sebastian Limeres, Abogado in Argentina.
Email: sebastian@limeres.com
WhatsApp: +54911-41620021