Amendment to the Antitrust Law

1. Introduction
 
On September 17 the Argentine Congress passed Law No. 26,993, amending, among other things, Law No. 25,156 (the “Antitrust Law”), named “Consuming Relationships Conflict Resolution System” (the “Amendment Law”). This new legislation also entailed (i) the creation of a preliminary system by means of which consumers may request a settlement with companies as regards their complaints, (ii) the incorporation of a new branch within the Judicial Power, namely the “National Courts on Consumer Relations” and (iii) the amendment of Law No. 24,240 (the “Consumer Defense Law”).
 
The analysis will focus on the changes to the Antitrust Law, which have clarified certain issues that have surrounded it ever since its enactment in 1999, while pointing out new questions that arise from these new amendments.
 
2. The disappearance of the Antitrust Tribunal and the splitting of the powers
 
Over the last 15 years there have been challenges as to which body would be the enforcer of the Antitrust Law. This can be traced back to the original settings of the Antitrust Law, which created the National Tribunal for the Defense of Competition (the “Antitrust Tribunal’) within the scope of the Ministry of Economy, which would be the ultimate antitrust regulator in Argentina. This Antitrust Tribunal would be composed of seven members, with a minimum of two attorneys and two accounting professionals on its staff.
 
However, said Antitrust Tribunal was never created. The Supreme Court ultimately set out, by means of two cases (1), the continuation of the two-tier regulatory system that had been set out by the previous Antitrust Law No. 22,262 composed by the National Commission for the Defense of Competition (the “Antitrust Commission”) which would perform technical reviews on mergers and investigations and issue recommendations to the Secretariat of Trade of the Ministry of Economy (the “Secretariat of Trade”), which would be the ultimate ruling body.
 
However, said two-tier regulatory system generated a new series of challenges as regards which of the two authorities had the powers invested by the Antitrust Law under former Section 24. The Amendment Law has now eliminated the notion of the Antitrust Tribunal and sets out a system which would resemble the interpretation carried out by the Supreme Court and which has been in place for years.
 
In the first place, pursuant to new Section 17, “The Executive Power will determine the enforcement authority of this law”. It is important to bear in mind that this drafting was modified when being analyzed in Congress, since the original drafting expressly stated that the Secretariat of Trade would be the enforcement authority. As such, it remains to be seen which authority the Executive Power will appoint, whether it will be the Secretariat of Trade or another agency (the “Enforcement Authority”).
 
All references included in the Antitrust Law as regards the Antitrust Tribunal will now have to be considered as pertaining to the Enforcement Authority, as per the settings of new Section 21. Pursuant to the new Section 19, this Enforcement Authority “will be assisted” by the Antitrust Commission.
 
The powers invested to the Enforcement Authority and the Antitrust Commission have now been clearly allocated pursuant to the provisions set out in Sections 18 and Section 20, the latter of which sets out a series of investigational but no resolution powers for the Antitrust Commission. As such, its new role of assistant to the Enforcement Authority is now clearly underlined.
 
Since Section 21 sets out that all references to the Antitrust Tribunal will now be considered as pertaining to the Enforcement Authority, certain issues currently being analyzed by the Antitrust Commission would now have to be dealt by the Enforcement Authority, one of the most important being the review of merger control cases. Under the current structure, the Antitrust Commission reviews the case, while the Secretariat of Trade issues the final opinion. While said scenario could be considered as falling under Section 18 Sub-section 17 that sets out that the Enforcement Authority can delegate tasks on the Antitrust Commission, new merger control filings should be addressed to both authorities in order to avoid problems as regards lack of notification until clear rules are addressed by both bodies. Similar considerations should be had when carrying out a claim on an anticompetitive matter, since while Section 20 Sub-section 20 sets out that the Antitrust Commission can issue a prior opinion on the matter, the investigatory body would now be the Enforcement Authority if no delegation is made to the Antitrust Commission.
 
3. Appeals: Solve et repete on fines, shorter terms and New Court of Appeals
 
Under the original drafting of the Antitrust Law, Section 52 clearly set out that appeals on the imposition of sanctions had a stay of execution, as opposed to the other possible scenarios, namely, the imposition of the ceasing of a conduct, the rejection or conditioning of a merger control case or the dismissal of a claim on an anticompetitive matter did not have a stay of execution.
 
Under the Amendment Law, said Section now makes no distinction, which is reinforced by the fact that new Section 53, second paragraph, now states “In all cases, in order to file the appeal against the administrative resolution that imposed a sanction of fine, the amount of the fine will have to be deposited in the name of the authority that set it out and the receipt for said deposit must be filed with the appeal, without which it will be considered as rejected, unless said performance could generate an irreparable harm to the appealing party”.
 
This new provision now entails the setting of a solve et repete system, by means of which the appeal will only be granted if payment of the fine has been carried out, unless “irreparable harm” can be shown, of which no guidelines or parameters are provided.
 
Further to this matter, the Amendment Law has also set out a shortening of the terms to appeal the original fifteen working days to file an appeal under prior Section 53 have now been reduced to ten working days.
 
In addition to this, the Amendment Law has now settled another important issue: the applicable Court of Appeals. Over the last decade there has been a discussion generated as to whether it would have to be the Federal Court of Appeals on Civil and Commercial Matters or the National Court of Appeals on Criminal Economic Matters and both appellate bodies have issued resolutions on matters arising from the Antitrust Law. Pursuant to new Section 53, upon the filing of an appeal, “…the enforcement authority will send the appeal with its answer to the National Court of Appeals on Consumer Relations or the applicable Court of Appeals…”
 
The National Court of Appeals on Consumer Relations is also created by means of the Amendment Law, and will have two Rooms of three members each and will serve as reviewing body of the “administrative sanctions” set under the Antitrust Law, the Consumer Defense Law and Commercial Practices Law No. 22,802, among other functions set by Section 45 of the Amendment Law.
 
4. From criminal to administrative: changes to procedural law
 
Finally, the Amendment Law includes a radical change as regards the supplementary procedural law. While the Antitrust Law has a series of procedural provisions of its own, former Section 56 set out that in those cases not foreseen by the Antitrust Law, the provisions of the Criminal Procedural Code were to be applied, while adding in the following Section that the provisions of the Law No. 19,549, namely the Administrative Procedural Law were not applicable to the Antitrust Law.
 
Under the new drafting of Section 56, it will indeed be the Administrative Procedural Law which will be applicable to those cases not set out in the Antitrust Law, which would point towards a decriminalization of the Antitrust Law and its re-interpretation as an economic instrument for the State.
 
The implementation of the Administrative Procedural Code also raises a series of questions that will most likely have to be analyzed in  times to come. In particular, it remains to be seen how Section 28 of the Administrative Procedural Law (namely, the protection against delay from the State) would be applicable as regards the widely-known delays on merger control proceedings which were originally set to have a duration of 45 working days and are now averaging more than two years for analysis.
 
5. Conclusion
 
The objective for the Amendment Law can be traced when analyzing the issues that have not been covered, since it has not carried out any changes to the interpretations of anticompetitive conducts, nor set up a leniency program as the one filed in a bill for Congress by the Antitrust Commission, nor addressed the low thresholds for notification or delays in merger control proceedings.
 
As such, these amendments to the Antitrust Law mainly address administrative and procedural issues that have been raised ever since its creation, such as the enforcing authority and applicable court of appeals. In this regard, the Amendment Law indeed clarifies said issues while triggering new questions and challenges, such as who will be the Enforcing Authority, what will be the exact role of the Antitrust Commission, what will be the rules that regulate the solve et repete provision or how will the enforcement of the Administrative Procedural Law impact on long-winded antitrust proceedings.
 
 
 
 

1. Sentences issued by the Supreme Court, in re Credit Suisse First Boston Private Equity Argentina II (S.C.C. 1216 L. XLI) and Recreativos Franco s/ apel. resol. CNDC (SC, R.1172, L. XII).