Oil exports made from the Special Customs Area are affected by export duties

By means of Resolution No 776/2006 (Official Gazette of October 11, 2006), the Ministry of Economy and Production interpreted that oil exports made from the Special Customs Area of the Province of Tierra del Fuego are affected by export duties that the Executive established under the Economic Emergency Law No 25,561, issued in January 2002.

The Economic Emergency Law established the enforceability of these export duties for a five year term, and empowered the Executive to fix the applicable rates, as well as establishing the products specifically reach.

For over thirty years the Tierra del Fuego Promotion Law No 19,640 (Official Gazette of June 2, 1972) has been in force, exempting from all export duties –current or future– on exports made from the Special Customs Area of Tierra del Fuego. Law No 19,640 adds that said exemption does not apply if the law that creates the new export duties expressly establishes that exports made from the Special Customs Area are affected.

In the opinion of the Ministry of Economy and Production, even though the Economic Emergency Law does not expressly provide for the application of these duties on transactions made from the Special Customs Area, as required by Law No 19,640, a “restrictive and severe interpretation” of the Economic Emergency Law allows the conclusion that export transactions made from the Special Customs Area are affected by the new export duties, which are collected by virtue of the dispositions of such law.

This new interpretation, issued by the Ministry of Economy and Production in Resolution No 776/2006, is opposed to the interpretation that the Customs Authority had been peacefully applying since 2002, authorizing export transactions made from the Special Customs Area without claiming the payment of the duties.

The Resolution in question implies an instruction to the Customs Authority to claim the payment of export duties from oil exporters for both past and future transactions.