Congress Rejects Merchant Fleet Regime Reform

On August 21, 2025, Argentina’s Senate rejected Emergency Decree 340/2025, issued by the Executive Branch in May of this year, which introduced significant reforms in the federal cabotage legal framework (see our comments in “New Merchant Navy Regime”). The House of Deputies had done the same on August 6, 2025. Both rejections were published in the Official Gazette on August 25, 2025 (Resolutions 39 and 57). 

The rejection of Decree 340/2025 by both Houses of Congress implies its repeal. This is stipulated in Law 26122, which regulates the legislative process and the scope of Congress's intervention regarding emergency decrees issued by the Executive Branch.

Decree 340/2025 had been based on a declared emergency in the sector, with the stated objectives of contributing to the progressive development of the Argentine Merchant Fleet, promoting competition between domestic and international operators, and aligning local regulations with international best practices.

Among its central provisions, Decree 340/2025 created a Special Regime for the Argentine Merchant Fleet, allowing shipowners to request the provisional suspension of the Argentine-flag registration of vessels to register them under foreign registries for up to ten years. It also facilitated the possibility for foreign-flagged vessels to obtain Argentine-flag treatment to operate in Argentine cabotage.

During the months it was in force, Decree 340/2025 was subject to multiple constitutional challenges (amparos), mainly before labor courts, which led to precautionary injunctions that suspended certain sections of its provisions, especially those restricting strike rights and amending crew members’ contracts regulations.

The rejection by both Houses of Congress is a rare occurrence in Argentina. There are few precedents of bicameral rejection of an emergency decree. 

In this context, to clarify the legal framework applicable to the National Merchant, the Executive Branch deemed it necessary to restore the validity of the provisions that had been repealed, amended, or replaced by Decree 340/2025.

This decision was formalized through a new emergency decree, published on September 3, 2025 (Emergency Decree 628/2025). Furthermore, it was ordered that the various jurisdictions and competent authorities issue the necessary administrative acts to ensure the proper implementation of this measure and its effective enforceability.

The repeal of Decree 340/2025, however, does not affect the rights that were acquired while it was in force (article 24 of Law 26122).
Given this political scenario, it will be important to evaluate the government’s reaction in view of its intention to the modernize and give new impetus to a sector that is so crucial for the Argentine economy.