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Overseas Judgments and the Australian Jurisdiction – Enforcement & Recovery of Debts

Dealings by Australian businesses with international clients, suppliers and developers are increasing at a rapid rate.

One result of that trend is the need to take into consideration the enforcement of claims brought against overseas-based companies or individuals. Regardless of where one’s business is based, the enforcement of claims brought against overseas-based parties can be difficult, lengthy, expensive and ultimately deeply unsatisfying.  Consideration of such issues, and of the steps that may be taken to improve the prospects of a successful recovery process, is highly recommended as a proactive measure to be taken when setting up dealings with international parties.

When seeking to enforce an Australian judgment in a foreign jurisdiction, the foreign jurisdiction’s laws on the enforceability of foreign judgments will govern the viability of the process. This article aims to provide a general background regarding the enforcement of Australian judgments in foreign jurisdictions, and the issues that typically arise.


Reciprocal Enforcement Arrangements

Australia is a party to reciprocal enforcement arrangements with many countries in respect of the enforcement of judgments obtained in Australian Courts. The Foreign Judgments Regulations (Cth) 1992, identifies those countries with which Australia reciprocal enforcement arrangements, including New Zealand, Germany, Japan and France. A notable exception is theUnited States, which situation persists despite the introduction of the Australia-United States Free Trade Agreement.

The terms of reciprocal enforcement arrangements differ from country to country. Reference must be had to the legislation of the relevant country in order to identify which Australian Courts (and, therefore, the judgments of those Courts) are recognised in that country, and to identify the applicable enforcement process.  A major benefit of there being an applicable reciprocal enforcement arrangement is the enforcing court will be unlikely to require that the merits of the Australian Court’s decision be re-visited.

Typically, when seeking to enforce an Australian judgment in a foreign jurisdiction with which Australia has a reciprocal enforcement arrangement, the judgment must:

• be final and conclusive – it is worth noting that in some foreign jurisdictions, even if an appeal of the Australian judgment is pending, the judgment may be viewed as ‘final and conclusive’ for purposes of seeking enforcement in those foreign jurisdictions.  Special rules may apply to default judgments;
• concern a matter regarding which the Australian Court held the jurisdiction to hear;
not conflict with local public policy in the jurisdiction in which enforcement of the judgment is sought – i.e. the terms of the Australian judgment, or the claim(s) determined by that judgment concern matters must not offend the public policy of the jurisdiction in which enforcement of the judgment is sought.  For example, judgments awarding exemplary damages are not recognised in some countries, and statutory interest attaching to Australian judgments may not be enforceable in countries that follow Sharia Law, which is often the case in Middle Eastern countries such as the United Arab Emirates;
– be a money judgment – i.e. the judgment cannot be an equitable order for an injunction or for specific performance;
– be made in respect of proceedings for which proper notice had been given – i.e. notice had been properly served on the overseas-based debtor pursuant to the procedural rules of the Australian Court that issued the judgment; and
– be given by a Court that is recognised as a court of sufficient standing by the foreign jurisdiction – i.e. whilst judgments given by the superior courts (e.g. the Supreme and Federal Courts) are generally recognised, reciprocal enforcement arrangements do not always provide that all Australian Courts will be recognised.

Access to the enforcement processes in a foreign jurisdiction is entirely dependant upon the laws of that country. Generally, a verified copy of the original Australian judgment, together with a translation of the judgment into the official language of the foreign country, should be provided to the applicable judicial body, together with:

– an affidavit setting out the particulars of the debt that is the subject of the Australian judgment and identifying the location of the overseas debtor; and
– written submissions confirming that the Australian judgment meets the substantive requirements of the relevant reciprocal enforcement agreement.

Non-Reciprocal Enforcement Arrangement Jurisdictions 

In foreign jurisdictions for which reciprocal enforcement arrangements are not in effect, generally the judicial authorities will not recognise Australian judgments as being the final determination on the merits of the claims raised in the Australian proceedings.  It is highly likely the merits of the Australian judgment will be re-examined by the judicial authorities of the foreign jurisdiction, potentially requiring a complete re-prosecution of the original claim.

In addition to any factual defences the overseas debtor might raise against the claim, the debtor may also be entitled to raise defences such as lack of jurisdiction, fraud, public policy considerations that are local to the foreign jurisdiction in which proceedings have been commenced, and denial of natural justice.

International Arbitration – an Alternative 

For cross-border commercial dealings, private arbitral proceedings are a commonly accepted alternative to the prosecution of claims through the court systems.  A prerequisite to taking a matter in dispute to arbitration is the parties’ agreement to accept arbitration.  Generally, the parties will make such an agreement when they enter into the contract that governs their commercial dealings.  Contracts that contain provisions to resolve disputes by arbitration typically set out the terms by which the rules governing the arbitration are selected, the body of law governing both the contract and the arbitral proceedings, the arbitral venue, the language in which the proceedings will be conducted, and perhaps most importantly, the parties’ agreement that arbitral awards will be binding on the parties and may be enforced in any courts that have jurisdiction over the party against which enforcement is sought.  That the parties did not agree at the time of contracting to accept arbitration does not preclude their later agreeing to do so, but this may lessen the likelihood of the parties agreeing to accept arbitration when a dispute arises.  Acceptance of arbitration as an alternative to pursuing claims through the courts is also becoming more common in purely domestic commercial dealings.

The election to resolve matters in dispute through arbitration proceedings often yields a number of benefits to the parties such as; the dispute may be heard by an industry specialist, the proceedings are frequently implemented much more quickly and then heard in less time, the avenues of appeal are limited, and the cost of arbitration often works out to be a fraction of the cost of proceedings conducted through the courts.

The Convention on the Recognition and Enforcement of Foreign Arbitral Award (“New York Convention”) and the UNCITRAL Model Law on International Commercial Arbitration (“UNCITRAL Model Law”)obligates courts from participating countries to recognise and enforce private arbitral awards made in a country that is a party to the New York Convention. At the time of writing, more than 140 countries are parties to the New York Convention. By contrast, there are only some 30 countries that have reciprocal enforcement arrangements with Australia.

The New York Convention identifies a range of grounds upon which a party against whom an arbitral award has been made, may seek to persuade a foreign court not to enforce the award.  These include; the party was subject to some incapacity, recognition and enforcement of the award is contrary to the public policy of the country in which enforcement is sought, or the award dealt with matters that fell outside the matters submitted for arbitration.

Given the wide acceptance of the New York Convention and its relatively straightforward operation, providing for resolution of disputes by arbitration in international commercial dealings is certainly worth considering, particularly where the counterparty is domiciled in a country, such as the United States, that does not have a reciprocal enforcement agreement with Australia.

Our top lawyers in Buenos Aires Argentina can advise parties both in respect of debt recovery and claims enforcement options available when dealing with a overseas-based parties as well as when negotiating appropriate terms of agreements to frame your commercial dealings with parties situated outside Australia.

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The proven Buenos Aires – Argentina lawyer professionals at the Kier Joffe law firm have experience working with foreign clients involved in all kind of cases in Argentina. Buenos Aires Argentina attorney professionals are knowledgeable in almost all the practice areas of law, to service its international cases in Buenos Aires Argentina. International clients will have the confidence of knowing that the case is being handled by an experienced and knowledgeable Buenos Aires  lawyer in Argentina.


Criminal Lawyer Buenos Aires – Argentina Attorney Law Firm

The proven Buenos Aires – Argentina criminal lawyer professionals at the Kier Joffe Law Offices law firm have experience working with foreign clients involved in a criminal claim in Argentina. Buenos Aires criminal attorney professionals are knowledgeable in all areas of general criminal law, including but not limited to burglary, homicide and forgery cases in Buenos Aires Argentina. International clients will have the confidence of knowing that the case is being handled by an experienced and knowledgeable Buenos Aires criminal lawyer.

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Argentina criminal law underlines the rules of law established by state and federal governments to set a standard of conduct for people to obey. Any action or failure to act in violation of a law commanding or forbidding it is classified a “crime”. A crime is defined as conduct that threatens, harms or endangers the safety of people and is split into four major sub-categories: fatal offenses, personal offenses, property offenses and participatory offenses.

Fatal offenses typically revolve around homicide and manslaughter, while personal offenses deal with instances of assault and battery, rape and sexual abuse. Property offenses in Argentina include breaking and entering, burglary and theft. Aiding in a criminal act would result in a participatory offense.

In Criminal Defense Law, the suit is initiated by the province or federal government through a prosecutor rather than being initiated by the victim. Plaintiffs in a civil law suit only need to show by a preponderance of the evidence that a defendant is liable (responsible) for the damages. But, the prosecutor in a criminal defense law case has to prove to the judge “beyond a reasonable doubt” that the defendant is guilty of the crime charged.

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The proven Buenos Aires – Argentina lawyer professionals at the Kier Joffe law firm have experience working with foreign clients involved in all kind of cases in Argentina. Buenos Aires Argentina attorney professionals are knowledgeable in almost all the practice areas of law, to service its international cases in Buenos Aires Argentina. International clients will have the confidence of knowing that the case is being handled by an experienced and knowledgeable Buenos Aires  lawyer in Argentina.


Wills, probate and inheritance in Argentina


Tax year and payment dates

1. When does the official tax year start and finish in your jurisdiction and what are the tax payment dates/deadlines?

For income tax purposes, the official tax year for individuals starts on 1 January and ends on 31 December.

Domicile and residence

2. What concepts determine tax liability in your jurisdiction (for example, domicile and residence)? In what context(s) are they relevant and how do they impact on a taxpayer?


For individuals, the domicile is the individual’s principal place of residence and business (Argentine Civil Code). When the principal place of residence differs from the principal place of business, the tax regulations provided that the domicile for tax purposes will be the principal place of business. For tax purposes, the domicile is relevant for receiving notices from the tax authority but is not used to determine tax liability.


Residence determines the manner in which an individual is taxed in Argentina. Whenever an individual, under the relevant rules of each tax (in particular, income tax and tax on personal assets), is deemed to be a resident of Argentina, the tax is levied on a worldwide basis (either on worldwide sourced income or the assets owned worldwide by the taxpayer) rather than on an exclusively Argentine basis. Resident individuals must file tax returns with the Argentine Tax Authority. Non-resident individuals are solely taxed on their Argentine-sourced income (through withholding) and on their Argentine-based assets.

Under Argentine income tax law, the following are considered Argentine residents for tax purposes:

– Argentinean individuals, whether native or naturalised, except for those that no longer hold a “permanent resident” status either because:

i. they became permanent residents of another country under that company’s immigration rules; or

ii. due to a continued residence abroad for a continuous period of 12 months. Short trips to Argentina are deemed not to interrupt the 12-month continuous residence period if they do not cumulatively exceed 90 days in a 12-month period.
Foreign individuals that have a permanent resident visa or individuals who have remained in Argentina for 12 months while holding temporary visas. If absences from Argentina do not cumulatively exceed 90 days in the 12-month period, the permanent residence period is deemed to be uninterrupted. However, foreigners who must remain in Argentina by reason of their employment for a period not exceeding five years (as well as their relatives) will not be considered to be Argentinean residents.

Under certain circumstances, individuals re-entering Argentina with the intention of residing permanently in Argentina will be considered to be Argentinean residents. This will even apply if they had previously lost their residence status in Argentina or if they acquired status as a permanent resident elsewhere.

Taxation on exit

3. Does your jurisdiction impose any tax when a person leaves (for example, an exit tax)? Are there any other consequences of leaving (particularly with regard to individuals domiciled in your jurisdiction)?

There are no exit taxes in Argentina. There are no other consequences of leaving, except that it is necessary to file a special tax return for the irregular period closing the date in which the individual leaves the country. Once an individual is no longer an Argentine resident, he:

– No longer has to pay income tax on a worldwide source basis and is only taxed, through withholding, on his Argentine-sourced income.
– Is no longer subject to personal assets tax on his worldwide assets but solely on his Argentine-based assets.

Citizenship does not necessarily determine tax liability. For example, an individual that resigns Argentinean citizenship but remains a resident of Argentina is still subject to tax in Argentina on his worldwide assets and income.

Temporary residents

4. Does your jurisdiction have any particular tax rules affecting temporary residents?

Foreigners who must remain in Argentina by reason of their employment for a period not exceeding five years (as well as their relatives) will not be considered to be Argentinean residents (see Question 2, Residence). Certain treaties to avoid double taxation also address the issue of temporary residents (see Question 14).

Taxes on the gains and income of foreign nationals

5. How are gains on real estate or other assets owned by a foreign national taxed? What are the relevant tax rates?

There is no capital gains tax on individuals in Argentina. Therefore, in principle, tax is not charged on the sale of real estate or other assets when the seller is a foreign individual.

However, if the foreign individual is usually engaged in buying and selling assets, he will be deemed an individual “enterprise” (which is not expressly defined in the Income Tax Law) and income tax is withheld on the total amount received by the seller on the sale of real estate at an effective rate of 17.5%. Alternatively, the foreign seller can file a special tax return with the tax authority to evidence the actual profit derived from the sale, and apply income tax at the rate of 35% on the net proceeds (see Question 6).

When the sale of real estate is not subject to income tax (whether made by an Argentine individual or a foreign individual), the seller is subject to a special tax on the transfer of real estate at the rate of 1.5% of the amount of sale.

Certain stamp taxes apply on the instrument (that is, public deed (escritura)) evidencing the sale. The buyer and seller customarily pay one-half each of those stamp taxes, which can be up to 4% of the sale price.

6. How is income received by a foreign national taxed? Is there a withholding tax? What are the income tax rates?

Generally, any income or profit obtained by foreign beneficiaries (as non-Argentine resident individuals are referred to under income tax regulations), which is deemed to be Argentine-sourced, is subject to withholding tax. Withholding tax does not apply on dividends paid by Argentine companies or to profits obtained from permanent establishments in Argentina.

For resident individuals, the income tax charged on a sliding scale that starts at 9% for individuals making up to ARS10,000, and goes up to 35% for individuals making more than ARS120,000. For any other taxpayer (including foreign beneficiaries) the rate of the tax is 35%.

To determine the tax liability of a foreign beneficiary, the Income Tax Law establishes a series of non-rebuttable presumptions of net income on the gross amounts paid, that varies depending on the kind of payment made by the local resident (who must act as withholding agent), including:

– 60% of the amounts paid for technical, engineering or consulting services that are not obtainable in Argentina and fulfil the requirements established by the Transfer of Technology Law (as the tax rate is 35% this amounts to an effective tax rate of 21% on the income).
– 80% of other amounts paid under the Transfer of Technology Law (effective rate: 28%).
– 35% of the royalties paid for the exploitation of copyright in Argentina (effective rate: 12.25%).

-100% in the case of interest. However, 43% (effective rate: 14%) is deemed to be the net income of Argentine source where the:

i. borrower is a financial institution;
ii. lender is a bank or financial institution located in a non-tax haven jurisdiction;
iii. interest relates to certain bonds that are registered in countries with which Argentina has concluded investment protection agreements.
– 40% of the amounts paid for renting movables goods in Argentina (effective rate: 14%).
– 60% of the amounts paid for renting real estate in Argentina (effective rate: 21%).

Finally, if the concept of the income is not expressly set out in the Income Tax Law, 90% is deemed net income of Argentine source (effective rate: 31.5%).

Argentina has entered into treaties to avoid double taxation with various countries (see Question 14).

Inheritance tax and lifetime gifts

7. What is the basis of the inheritance tax or gift tax regime (or alternative regime if relevant)?

There are no federal inheritance or gift taxes in Argentina. Only one jurisdiction (the province of Buenos Aires) has imposed an inheritance and gift tax on the amount received by the beneficiary. This tax is applicable as from January 2010, and is charged on assets:

– Located in the province (even if the owner is not domiciled there).
– Transferred to individuals or legal entities domiciled in the province.

The tax rate will depend on the amount received by the beneficiary and his relationship with the deceased.

8. What are the inheritance tax or gift tax rates (or alternative rates if relevant)?

Tax rates

Tax is payable on the amount received, at progressive rates from 4% to 21.92%.

Tax free allowance

There is a tax-free allowance of ARS50,000 on the aggregate of the lifetime gifts of an individual and the gifts at the time of death. This amount is increased to ARS200,000 when the receiving party is the spouse, child or parent of the transferor.

In addition, in relation to inheritance tax, the debts of the deceased existing at the time of his death, and funeral expenses, are deductible from the amount transferred to the beneficiary.


The following are exempt from inheritance or gift tax:

– Any transfers in favour of the national government, the provinces or the City of Buenos Aires or any municipality or any body of these institutions.
– Gifts to religious, public health, social assistance, cultural or public welfare institutions, provided those institutions comply with certain conditions.
– Transfer of art or other objects that have a historic, scientific or cultural value, as long as the deceased has transferred the property on the basis that the art or object is to be used for instruction or public exhibition purposes.
– Transfer of collections of books, newspapers, magazines or other periodic publications.

– Transfer on death of the household registered under the Family Household Protection Act (Law N° 14,934) when:

i. the transfer is made in favour of the spouse, descendants, ascendants or collateral relatives up to the third degree of relationship with the deceased;
ii. they lived with the deceased;
iii. the registration of the property under the Family Household Protection Act is maintained for at least five years after the death.

– Transfer on death of urban real estate that is used as the household, when the:

i. transfer is made in favour of the spouse, ascendants or descendants (including adopted children);
ii. property does not exceed a certain valuation, established by the province on an annual basis.

– Transfer on death of an enterprise when the:

i. aggregate gross income of the fiscal year before the year of death exceeds a certain figure established annually;
ii. transfer is made in favour of the spouse, ascendants or descendants (including adopted children);
iii. acquiring parties maintain the enterprise in activity for five-year period following the deceased’s death.

Techniques to reduce liability

The simplest way to avoid inheritance or gift tax liability is to avoid being domiciled in the province of Buenos Aires, and to own assets through a company domiciled outside of the province of Buenos Aires.


Not applicable.

9. Does the inheritance tax or gift tax regime apply to foreign owners of real estate and other assets?

If the assets are located in the province of Buenos Aires, the tax applies even if the owner does not reside in Argentina.

10. Are there any other taxes on death or on lifetime gifts?

There are no other taxes on death or on lifetime gifts.

Taxes on buying real estate and other assets

11. Are there any other taxes that a foreign national must consider when buying real estate and other assets in your jurisdiction?

Purchase and gift taxes

The provinces impose stamp tax on the public deed required to transfer real property (see Question 5). The rate varies depending on the province, and ranges from 2% to 4% of the price paid for the property being transferred.

In addition, there is a special tax on the transfer of real estate that applies when the sale is not subject to income tax (that is, when the sale is made by an individual rather than an enterprise). The rate of the tax is 1.5% applicable of the price paid.

Wealth taxes

The Personal Assets Tax applies to foreign individuals holding property (whether real estate, movable property or intangible property) in Argentina. The rate of the tax is 1.25% and it is levied on an annual basis. When the owner of the real estate is a foreigner, there are certain methods of substitution that impose the obligation to pay the tax on the local resident that has the administration of the asset.


Each of the provinces and the city of Buenos Aires (which has an autonomous status, as if it were a province) levy a tax on real estate. The tax is imposed on the fiscal valuation of the real estate and the rate varies depending on the valuation of the property.

12. What tax-advantageous real estate holding structures are available in your jurisdiction for non-resident individuals?

The simplest holding structure is to have a special purpose foreign company to own the real estate in Argentina. This company must be set up in a country that does not tax capital gains (or at least does not tax the capital gains stemming from the sale of equity instruments). There are no local rules that deem the sale of this special purpose company a sale of real estate in Argentina.

Taxes on overseas real estate and other assets

13. How are residents in your jurisdiction with real estate or other assets overseas taxed?

Local residents are taxed on their worldwide income; however, capital gains are not subject to tax, except when the individual usually trades in selling and buying real estate or assets (see Question 5).

International tax treaties

14. Is your jurisdiction a party to many double tax treaties with other jurisdictions?

Argentina has entered into double taxation treaties, although some have been recently cancelled or repealed (such as the ones entered into with Spain and Austria). Current treaties include treaties with: Australia, Belgium, Bolivia, Brazil, Canada, Denmark, Finland, France, Germany, Italy, The Netherlands, Norway, United Kingdom, Sweden and Switzerland.

Wills and estate administration

Governing law and formalities

15. Is it essential for an owner of assets in your jurisdiction to make a will in your jurisdiction? Does the will have to be governed by the laws of your jurisdiction?

It is not essential for an owner of assets in Argentina to make a will in Argentina. Where no will is present, forced heirship and intestacy rules apply (see Questions 24 to 29). In Argentina, it is not usual to have wills or testaments, except for certain wealthy individuals. There is no requirement for the will to be governed by the laws of Argentina, although the provisions of a foreign law are only applied where they do not violate Argentine public policy (for example, forced heirship rules).

16. What are the formalities for making a will in your jurisdiction? Do they vary depending on the nationality, residence and/or domicile of the testator?

The formalities for making a will in Argentina are the same, regardless of the nationality, residence and/or domicile of the testator.

There are three different ways in which wills can be made (Argentine Civil Code):

1. Handwritten testament (testamento ológrafo). This must be completely handwritten, signed and dated by the testator.
2. Public deed testament (testamento por acto public). This must be notarised by a public notary, with three witnesses that insert their signature in the public deed.
3. Closed testament (testamento cerrado). This does not have to be completely handwritten by the testator, although it must bear the testator’s signature. In addition:it must be given in a closed
i. envelope to a public notary in the presence of five witnesses;
ii. the testator must say aloud that the closed envelope contains his will.

Redirecting entitlements

17. What rules apply if beneficiaries redirect their entitlements?

Beneficiaries are not entitled to redirect their entitlements.

Validity of foreign wills and foreign grants of probate

18. To what extent are wills made in another jurisdiction recognised as valid/enforced in your jurisdiction? Does your jurisdiction recognise a foreign grant of probate (or its equivalent) or are further formalities required?

Validity of foreign wills

Wills made in a foreign jurisdiction are recognised as valid, as long as they comply with the law of the place in which the wills were made. Substantive provisions, however, must comply with Argentine law (in particular, forced heirship) to be enforceable in Argentina. The law will also enforce wills made by foreigners outside of Argentina if the will complies with the formalities of the place of residence of the testator, his country of nationality, or those of Argentina.

Validity of foreign grants of probate

As with foreign wills, foreign grants of probate will be recognised in Argentina if they comply either with Argentinean laws or the relevant foreign law (see above, Validity of foreign wills). No further formalities are required.

Death of foreign nationals

19. Are there any relevant practical estate administration issues if foreign nationals die in your jurisdiction?

The issues depend on whether the foreign national’s last domicile was in Argentina or not and whether he had any assets in Argentina. If he was domiciled in Argentina, Argentine rules apply and a court-based procedure (sucesión) must be followed. This also applies if he has assets in Argentina.

Administering the estate

20. Who is responsible for administering the estate and in whom does it initially vest?

Responsibility for administering

The court appoints an administrator of the estate (usually, the surviving spouse or an heir or a group of heirs) that has limited authority to carry on acts that are:

  • Necessary to preserve the estate.
  • Ordinary, considering the nature of the goods and assets that are being administered.

The administrator, in principle, has no authority to sell, mortgage, pledge or otherwise dispose of or encumber the goods and assets.


A court procedure must be followed to finally declare the legitimate heirs of the deceased. When the court makes that declaration, the estate is deemed to have vested directly and immediately from the deceased to each of its heirs.

21. What is the procedure on death in your jurisdiction for tax and other purposes in relation to:
  • Establishing title and gathering in assets (including any particular considerations for non-resident executors)?
  • Paying taxes?
  • Distributing?

Establishing title and gathering in assets

Any and all heirs are entitled to establish title and gather in assets. However, everything must be done through the court procedure and with the control of the judge. There are no particular considerations for non-resident executors in this aspect, since court participation is mandatory. If a non-resident executor has been appointed, the court will probably require from him a local address for service of process.

Procedure for paying taxes

Until the court procedure is ended, the administrator is responsible for filing tax returns and paying taxes on behalf of the estate. Failure to do so could make the administrator jointly and severally liable for any unpaid taxes.

Distributing the estate

The court distributes the estate in the court procedure (see above, Establishing title and gathering in assets). The court decides how the distribution is to be made or grants authority to distribute the estate to the testator or the executor.

22. Are there any time limits/restrictions/valuation issues that are particularly relevant to an estate with an element in another jurisdiction?

In principle, there are no time limits, restrictions or valuation issues that are particularly relevant to an estate with an element in another jurisdiction.

When the estate involves elements in different jurisdictions, certain “offset” provisions of the Argentine Civil Code might be relevant, depending on the facts. Heirs of the deceased that reside in Argentina would be entitled to a larger portion of the assets that are located in Argentina if, due to the application of foreign law, they were deprived of assets located abroad (or a portion of those assets) that should have, under Argentine Law, been allocated to them under the forced heirship regime (see Question 24). Therefore, if a foreign resident dies leaving assets in both Argentina and in his home country, and through a will deprives an heir who resides in Argentina of his statutory reserved portion under Argentine Law, that heir is entitled to the additional portion of the Argentine assets, equal to the value ascribed to the deprived portion (see Question 24).

23. Is it possible for a beneficiary to challenge a will/the executors/the administrators?

A beneficiary is entitled to challenge the:

i. Will, when it affects the portion that Argentine Law mandatorily reserves for forced heirs.
ii. Executors, when their acts affect the portion that Argentine Law mandatorily reserves for forced heirs or when they depart from the instructions contained in the will.
iii. Administrators, when they perform their duties in excess of their authority or without fulfilling the “good businessman” standard.

Succession regimes

24. What is the succession regime in your jurisdiction (for example, is there a forced heirship regime)?

Argentina has a forced heirship regime that is deemed part of public policy. Any provisions of the parties (either by the deceased or the heirs) against it are invalid and of no force and effect. There are precedents in Argentine courts in which forced heirship claims have been admitted against trust assets.

Forced heirs (ascendants, descendants, spouses and others) cannot be deprived of a certain portion of the deceased’s estate (except where one of the few statutory causes for disinheritance are present and invoked by the decedent in the will). These portions are:

  • i. Children and their issue: four-fifths of the total assets of the deceased.
  • ii. Ascendants (where there are no children): two-thirds of the assets of the deceased.
  • iii. Spouse (where there are no ascendants or descendants): one-half of the assets of the deceased.

In relation to the intestacy rules, see Question 28.

Forced heirship regimes

25. What are the main characteristics of the forced heirship regime, if any, in your jurisdiction?

Avoiding the regime

There are no ways to avoid the regime and judges are reluctant to admit structures that defeat the forced heirship rules.

Assets received by beneficiaries in other jurisdictions

Assets received by beneficiaries in other jurisdictions are taken into account (see Question 22).

Mandatory or variable

Any agreement entered into between future beneficiaries during the deceased’s life is null and void. Argentine law forbids any agreement regarding the future estate.

Real estate or other assets owned by foreign nationals

26. Are real estate or other assets owned by a foreign national subject to your succession laws or the laws of the foreign national’s original country?

Title to real property located in Argentina may only be passed in accordance with Argentine law. It is unclear, however, if this applies solely to transfers between living persons or if it should also apply in the case of transfer by death. However, most Argentinean court decisions have held that it applies to both.


27. Do your courts apply the doctrine of renvoi in relation to succession to immovable property?

The Argentine courts may, where the case concerns immovable property located in Argentina, accept a reference back to their jurisdiction; however, this is a complex area of law.


28. What different succession rules, if any, apply to the intestate?

The intestacy succession rules depend on the surviving relatives.

i. There are surviving descendants but there is no surviving spouse. The children are entitled to the entire estate. If any of the children have predeceased but have surviving issue, the share that would have been allocated to that child goes to his or her issue per stirpes (in equal proportions).
ii. There is a surviving spouse and surviving descendants. One-half of the deceased’s “marital” property is distributed to the surviving spouse and the other half is transferred entirely to the children (in relation to marital property, see Question 37). The deceased’s “own” property is distributed in equal portions among all of the children and the surviving spouse.
iii. There are surviving ascendants but no surviving descendants or a surviving spouse. The whole estate passes to the surviving ascendants. In this case, the closer generations exclude the inheritance rights of the further generations (for example, the grandfather is excluded if the father survived).
iv. There is a surviving spouse and surviving ascendants but no descendants. The surviving spouse is entitled to one-half of the marital and one-half of the own property of the deceased. The other half goes to the ascendants.
v. There is a surviving spouse but no surviving ascendants or descendants. The surviving spouse is entitled to the whole estate.
 vi. There are no surviving ascendants or descendants, and there is not a surviving spouse. The collaterals (until the fourth degree of relationship) are entitled to the estate.

29. Is it possible for beneficiaries to challenge the adequacy of their provision under the intestacy rules?

It is not possible for beneficiaries to challenge the adequacy of their provision under the intestacy rules.


30. Are trusts (or an alternative structure) recognised in your jurisdiction?

Type of trust and taxation

Law No. 24,441 (Trust Act), enacted in December 1994, established the regulation for trusts in Argentina. Trusts under the Trust Act depend on the concept of revocable property (dominio revocable) and have certain differences with the common law concept of trust.

Generally, the Trust Act considers two types of trusts, a financial trust and an ordinary trust. The difference between the two depends on the person acting as trustee. If it is a financial trust, the trustee must be a financial entity or a corporation specifically authorised by the Argentine Securities Commission to act as financial trustee.

Residence of trusts

In general terms, if the trust is set up under Argentine law, it is deemed a resident of Argentina for tax purposes.


31. Does your jurisdiction recognise trusts that are governed by another jurisdiction’s laws and are created for foreign persons?

Argentina recognises trusts that are governed by another jurisdiction’s laws and are created for foreign persons.

32. What are the tax consequences of trustees (for example, of an English trust) becoming resident in/leaving your jurisdiction?

If any foreign entity (including a trust) becomes resident in Argentina, it is subject to tax in the same manner as an Argentine corporation.

33. If your jurisdiction has its own trust law:

– Does the law provide specifically for the creation of non-charitable purpose trusts?
– Does the law restrict the perpetuity period within which gifts in trusts must vest, or the period during which income may be accumulated?
– Can the trust document restrict the beneficiaries’ rights to information about the trust?

Purpose trusts

The Trust Act does not include specific provisions regarding non-charitable purpose trusts. However, Argentine law distinguishes between an act that is gratuitous from an act which is made for a consideration that has certain legal effects such as, for example, a fraud of creditors, which may be relevant in the context of transfers to trusts.

Perpetuities and accumulations

A trust has a maximum term of 30 years from the date on which it was created. The restriction does not apply where the beneficiary is not capable, in which case the trust can extend until the incapacity ceases or the person with the incapacity dies. There are no regulations regarding the period within which income must be accumulated.

Beneficiaries’ rights to information

The Trust Act does not include any information rights in favour of the beneficiary that cannot be contractually restricted. However, the statute does prohibit any provision that would release the trustee from liability incurred due to the non-performance of his duties.


34. Does the law in your jurisdiction recognise claims against trust assets by the spouse/civil partner of a settlor or beneficiary on the dissolution of the marriage/partnership?

In relation to marital property, the spouse would not be entitled to claim against trust assets in the case of dissolution of the union (that is, divorce or death of one of the spouses). However, the spouse could, depending on the circumstances, be entitled to make a claim directly against the other spouse at the time of dissolution. When the trust was settled with own property, and the settlor dies, the forced heirship rights apply (see Question 24).

35. To what extent does the law of your jurisdiction allow trusts to be used to shelter assets from the creditors of a settlor or beneficiary?

Where a trust is used to shelter assets from the creditors of a settlor or beneficiary, fraudulent conveyance rules can be used under the Trust Act to invalidate the transaction.

Ownership and familial relationships


36. What are the laws regarding co-ownership and how do they impact on taxes, succession and estate administration?

The Argentine Civil Code establishes the co-ownership rules (condominio). Those rules do not have any relevant impact on taxes, succession and estate administration, except in connection with the co-ownership rules applicable to the “marital” property, in which one of the spouses is responsible for filing the tax returns on that property. Generally, any co-owner has the right to require the dissolution of the co-ownership (even if it requires the sale of the good). There are few cases in which the right to dissolve the co-ownership does not apply.

Familial relationships

37. What matrimonial regimes in trust or succession law exist in your jurisdiction? Are the rights of cohabitees/civil partners in real estate or other assets protected by law?

Generally, the matrimonial regime in Argentina (which applies to all couples that married in Argentina, as long as their initial domicile was in Argentina) provides that all property (whether tangible or intangible) that was acquired by any of the spouses during the marriage is “marital property” (bienes gananciales). However, property that was received as a gift remains the own property of the spouse that received it. The marital property relates to the marriage “partnership” and, on dissolution, is distributed between the partners (spouses) by halves.

There are no relevant protections for cohabitees or civil partners (except for the case of same-sex civil unions, which were formalised by statute in 2010) (see Question 38).

38. Is there a form of recognised relationship for same-sex couples and how are they treated for tax and succession purposes?

Same-sex unions were legalised by statute in 2010. As this is a recent development, no case law exists. However, regulations passed under the statute establish that the tax and succession treatment must be the same granted to a heterosexual marriage.

39. How are the following terms defined in law:
  • Married?
  • Divorced?
  • Adopted?
  • Legitimate?
  • Civil partnership?


Marriage is defined as a person that is united to another of the opposite sex, as husband or wife, in a consensual and contractual relationship recognised by law, and in which the consent is usually expressed in the presence of a public officer. There are certain “marital duties” that the spouses must comply with (such as fidelity, maintenance payments, and residing in the same house).


A divorce is the final termination of a marital union. It is declared by a judge in a formal procedure, and it cancels the marital duties and dissolves the marital “partnership”.


An adopted child is one that was taken into a family that is different to the one of its parents after a legal process was followed under the Argentine Adoption Act. The adopted child’s legal rights and obligations towards his natural parents are terminated and similar rights arise with the adoptive parents. Adopted children have the same legal status as children which are not adopted.


Formerly, a distinction was made between “legitimate” children (born from a married couple) and “natural” children (born with no marital union). Although the difference can still be found in certain sections of the Civil Code, legitimate, natural and adopted children have the same rights and status.

Civil partnership

Civil partnership is a legal union or contract, similar to a marriage, between two people of the same sex.


40. What rules apply during the period when an heir is a minor? Can a minor own assets and who can deal with those assets on the minor’s behalf?

Minors are represented, in general terms, by the surviving parent. If no parent survives, the court designates a representative (curador) to handle all the assets on the minor’s behalf. Disposition of assets usually requires court approval.

Capacity and power of attorney

41. What procedures apply when a person loses capacity? Does your jurisdiction recognise powers of attorney (or their equivalent) made under the law of other jurisdictions?

A court procedure is required to declare that a person has lost his capacity. The court appoints a curator to represent the incompetent person.

Generally, Argentina recognises powers of attorney made under the law of other jurisdictions. However, once a person is declared to have lost his capacity, under Argentine law any and all powers of attorney are terminated.

Proposals for reform

42. Are there any proposals to reform private client law in your jurisdiction?

Currently, a project to amend the Argentine Civil Code is being studied at the Congress. Although the project is complete, it is difficult to tell when (and if) it will be passed. However, although it does have effect on other areas of the civil law, it does not seem to affect significantly private client law.

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Real Estate: Summary and Critique of Argentina’s “Rural Land Law”

Argentina’s Rural Land Law

Last week, in an extraordinary session before summer recess, the Argentine Congress enacted a controversial law to restrict foreign ownership of rural lands. Law 26,737, introduced by the Executive Branch, passed with almost no floor debate. According to statements made by public officials, the law protects national sovereignty over natural resources by, among other things, limiting foreign ownership of rural lands to 1,000 hectares (approximately 2,500 acres) for each foreign person. Supporters of the law point to the massive holdings of Benetton and Ted Turner (Patagonia) and Douglas

Tompkins (northern Argentina wetlands) as examples of foreign wealth locking up sovereign resources. Read on for more about these restrictions and the disquieting uncertainties prompted by the law.

Summary of the Rural Land Law

The Rural Land Law restricts ownership and possession of rural land by natural and legal foreign persons. “Rural land” is broadly defined as “all land outside the urban area,” regardless of its location or use. While the Rural Land Law does not affect already acquired property and rights, it would affect future investments such as the acquisition of companies with rural land holdings.


The law imposes three restrictions on foreign ownership:

–      Foreign persons may not own more than 15% of all rural land in Argentina.

–      Of that 15%, no more than 30% may be owned by foreign persons of the same nationality.

–      Any one foreign person may not own more than 1,000 hectares (roughly 2,50 acres) in any “cluster” (zona núcleo) (a term that is not defined by the law). The Rural Land Law bans outright all foreign persons from owning coastal lands or other land adjacent to significant bodies of water. The law further prohibits foreign ownership of land within “border security zones,” absent consent from the Ministry of Internal Affairs, consistent with the exceptions and procedures established by law.

To implement its restrictions, the Rural Land Law calls for the creation of a “National Rural Land Registry,” a subdivision of the Ministry of Justice, and an Inter- Governmental Council of Rural Lands. The National Registry will be charged with

creating a database of rural lands owned by foreign persons. Current rural land owners subject to the “foreign person” definition are required to notify the National Registry within 180 days of the release of implementing regulations by the Executive Branch (which has not occurred yet). Any change in the ownership of a legal entity holding rural land must also be notified to the National Registry within 30 days of its occurrence.

Defining Foreign Persons

Foreign natural persons are not defined by the law but presumably the term excludes both natural-born and naturalized Argentine citizens. The law exempts three categories of foreign natural persons from its restrictions:

–      Those with 10 years or more of permanent and continuous residence in Argentina;

–      Those having Argentine children and at least five years of permanent and continuous residence in Argentina; and

–      Those married to an Argentine citizen for at least five years before acquiring the rural land (or interest in a legal person holding the land) and five years or more of permanent and continuous residence in Argentina.

As to legal persons domiciled in Argentina, the law defines them as “foreign” when:

–      Foreign natural or legal persons own more than 51% of its capital;

–      They are effectively controlled by any foreign legal person (which is presumed when foreign ownership exceeds 25%);

–      They have issued negotiable obligations or debentures, which allow a foreign holder to convert the instrument into equity representing more than 25% of the company’s capital stock; or

–      In the case of a trust holding rural land, when foreign beneficiaries have an interest in excess of 25%.

The law further declares rural land as a “non-renewable natural resource,” the acquisition of which will not be considered a protected investment under any Bilateral Investment Treaty to which Argentina is a party.

Commentary: Whose Interest is Being Protected?

The Rural Land Law is fraught with uncertainty, making it hard to assess its application. The law is patently contradictory in defining foreign legal persons (e.g., does a 51% or a 25% ownership threshold apply?). The law prompts obvious questions (e.g., would a foreign secured creditor be barred from foreclosing on a rural land mortgage? What is the

consequence of exceeding a nationality threshold? If a quota system, does a perspective buyer await an opening? How are natural persons with dual nationality to be considered?). Some or even all of these questions may be answered by the Executive Branch when it releases regulations. Nonetheless, it is unclear when this will be done.

The absence of meaningful debate only adds to the confusion prompted by the Rural Land Law. While a government may rightly assure that a country’s natural resources be available to its citizens, it would appear that the legislators have confused sovereignty with nationality. The owner’s nationality does not affect the State’s power to tax, to regulate, to condemn or even to expropriate in the public interest. It is hard to understand

the Rural Land Law as upholding any national interest, unless one accepts that the law will rightfully keep Argentine rural lands from being a world market commodity, thereby protecting the ability of Argentine citizens to acquire large landholdings without competing with foreign wealth. If so, it is hard to imagine the Argentine landed gentry as a class requiring the State’s protection.

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Foreigners own 6% of rural land in Argentina, equivalent to 15.8 million hectares

A total of 5.93% of rural land in Argentina is foreign-owned President Cristina Fernández announced which amounts to 15.8 million hectares. During a speech at Government House, Justice Secretary Julián Alvarez presented a survey that is a prelude to the full implementation of the Law 26,737 on Rural Lands (Ley de Tierras Rurales) passed in 2011 to place a 15% limit on foreign ownership of rural land in Argentina.

Catamarca, San Juan, Salta, Corrientes and Misiones were identified as the only provinces with 10% of their lands in foreign hands. Rural lands were reported to account for 95.8% of the total Argentine territory that is estimated at 277 million hectares. Neighbouring Uruguay is estimated to have 16 million hectares of rural land.

The top foreign owners were from the United States (3 million hectares), Spain (2.3 million) and Italy (2.1 million). A special mention was reserved for the British, who posses 1 million hectares, which Julian Alvarez attributed in part to firms, based in “tax havens”.

The survey was carried out through cooperation between Argentine municipal, provincial and national authorities, and the law will also be implemented at those levels.

That is, although no provinces were found to exceed the 15% limit, ten “subdivisions,” or departments, out of 569 were above the ceiling.

The Articles 8 and 9 of the law state that within each department, each foreign individual or entity will not be able to acquire more than 30% of land within the allowed 15% of the total land of the subdivision.

Alvarez, who said the aim of the law is to “protect our territorial sovereignty,” denied “legislative overacting” from the government and emphasized that the law is in “full force,” criticizing the opposition for having considered the law impossible to apply.

Cristina Fernandez who spoke after Alvarez pinpointed to the alleged contradiction of the opposition, which mostly abstained from voting the bill in 2011.

The law was passed with 153 votes for, 26 against, 1 abstention and 77 absentee members of Congress, with the president accusing the opposition of not having voted for the law because it was promoted by the Victory Front (FpV).

Cristina Fernandez said that “our land” is a “non-renewable resource,” and “this is why I wanted to use the instrument of the national broadcast, so all Argentines” can “be informed about the effort we have made to fulfil a law.”

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