Impact Related to Antitrust Matters

The coronavirus COVID-19 pandemic and its economic impact raise important issues for antitrust and related regulations. These are the initial effects that may be observed:

 

• Suspension of procedural deadlines and application of the Antitrust Law and the Fair Trading Decree

 

On March 19, 2020, Resolution No. 98/2020 of the Secretary of Trade was published in the Official Gazette, suspending all proceedings and/or procedural deadlines under the Antitrust Law No. 27,442 (the “LDC” after its acronym in Spanish) and Decree No. 274 dated April 17, 2019 on Fair Trading (the "Fair Trading Decree") for the period as from March 16, 2020 to March 31, 2020, both dates inclusive, and with the possibility of being extended. Such extension has taken place by means of Resolutions No. 105/2020, 113/2020,123/2020, 132/2020, 150/2020, 197/2020 and 219/2020 of the Secretariat of Domestic Trade, the latter of which sets the suspension deadline for July 17. In view of the new extension of the social, preventive, and mandatory lockdown, decided by the Argentine Executive, up to August 2, it is expected that the Secretariat of Domestic Trade will issue a new resolution in the following days extending once again the suspension of deadlines up to that date, with retroactive effect to July 17.

 

Concerning those concentrations and investigations that are processed before the National Antitrust Commission (the “CNDC” after its acronym in Spanish), the immediate effect of the measure will be the delay in their resolution term.

 

As for the term for the notification of economic concentrations whose procedures have not been yet initiated, stricto sensu, Resolution No. 98/2020 would not suspend the mandatory one-week period established in Section 84 of the LDC. Nevertheless, taking into account the transport restrictions and considering that the that the filing of notifiable transactions and the submission of claims must be performed in person before the CNDC, it is recommended contacting the authority before planning any such submissions.

 

It should also be noted that while several international jurisdictions authorized certain sectors of the economy, such as tourism, health or air transport, the partial suspension of the antitrust laws in Argentina, at the time of writing, there have been no official communiques about a possible inapplicability or suspension of the LDC. On the contrary, the measures dictated by the government tend to reinforce controls and its enforcement.

 

In this regard, companies should review their business practices and agreements to avoid possible anti-competitive risks and be subject to further investigations by the authority.

 

As for the Decree 274/2020 on Fair Trading, it is recalled that it is fully in force. Therefore, it is recommended to be extremely careful not to carry out unfair competition acts that may lead to investigations such as: acts of deception on the nature, method of manufacture, main characteristics and conditions of the goods or services; the violation of rules to take significant advantage; and the abuse of a situation of economic dependence in which a client or supplier may find itself without an equivalent alternative for the exercise of its activity in the market.

 

• Market investigation

 

In the context of the health emergency that is taking place in our country as a result of the outbreak of the coronavirus COVID-19, the Secretariat of Domestic Trade has taken certain measures aimed at guaranteeing the supply of and access to, without restrictions, essential food, hygiene and healthcare products, and others aimed at controlling these markets.

 

Therefore, on March 30, 2020, Resolution No. 103/2020 of the Secretariat of Domestic Trade was published in the Official Gazette, through which an information system on prices of the Beef Processing Industry and its derivatives was created. This resolution provides that the obliged parties must, on the last working day of the week of each calendar month, inform the Undersecretariat of Actions for the Defense of Consumers of the daily quantity of resides of beef and cowhide that is commercialized, its average daily sales price per unit of measure and the category of origin of such products.

 

On the other hand, the resolution instructs the CNDC to carry out an investigation of the beef market in order to determine the possible commission of infringements to the LDC.

 

Furthermore, according to a statement published on the official website of the Ministry of Productive Development on April 29, 2020, the CNDC will carry out a new investigation of the bulk and tube medical liquid oxygen market, along with the corresponding transport service throughout the country, in order to determine possible infringements to the LDC.

 

• Shelf Space Law

 

The declaration of the health emergency will affect in the implementation of the recently “Shelf Space Law” Law No. 27.545, published on March 17, 2020 in the Official Gazette.

 

Although the law entered into force eight days after its publication in the Official Gazette, the law granted a term of 90 days for the enforcement authority to compile a list of the different categories of products involved, since this has not yet been done and the term has already expired, delays and difficulties in its implementation are estimated due to the fact that its regulation is pending and to the current health emergency situation.