New Rule Complements Recently Implemented Fair Trade Regime in Argentina

As commented in a previous Marval News edition https://www.marval.com/publicacion/nuevo-regimen-de-lealtad-comercial-en-la-argentina-13349&lang=en , on April 17, 2019, the Argentine Executive issued Emergency Decree No. 274/2019 (the “Decree”). The Decree established a new regime for Fair Trade repealing Law No. 22,802 and introducing material changes on aspects concerning unfair competition, advertisements, comparative advertisement, the administrative procedure for sanctions and court actions.

Resolution No. 248/2019 (the “Resolution”) regulated certain aspects of the Decree. Firstly, the Resolution appointed the Fair Trade Agency, controlled by the Secretariat of Domestic Trade, as the controlling and supervisory authority under the Decree in charge of conducting the relevant administrative proceedings. This agency will receive the complaints, carry out the investigation and draft a proposal of sanction on the infringer of the Fair Trade regime that will be considered by the Secretariat of Commerce. The Resolution also rules on procedural aspects in the investigation proceedings and appeals.

The Resolution clarifies the overlapping of the provisions of the Decree and those of Antitrust Law No. 27,442 (the “LDC”). For example, when the acts listed in article 9 or 10 of the Decree overlap with those of the LDC, the Decree  prevails. This is to say that no party would be able to pursue administrative procedures with the relevant antitrust authority, and also before the Fair Trade Agency for the same conduct. The LDC is the controlling legislation on conduct related to matters of fair trade that may also be covered by the LDC, and the principle of res judicata applies—i.e., when a matter involving unfair competition has been addressed under the LDC, the same matter cannot then be adjudicated again through an action or administrative procedure under the Decree. However, if the complaint were dismissed or the file were closed before the issuance of an statement of objections, the case could still be brought before the Fair Trade Agency, which will be allowed to investigate the alleged unfair competitive acts.

At the time, the Resolution clarified that renegotiation, modification of terms and commercial conditions and termination of commercial relationships as well as the regular exercise of rights cannot be considered an act of unfair competition.

The Resolution specifies that an advertisement will be considered misleading when the information provided is incomprehensible by reason of the speed of its spoken language, the size of its lettering, or any other problematic aspect. The Resolution partially modifies the text of previous Resolution No. 915/2017 by the former Commerce Secretariat https://www.marval.com/publicacion/publicidad-de-bienes-y-servicios-unificacion-normativa-13123&lang=en  , which determined what conditions—such as font, size, color, and other features of typed characters—must be included in advertisements for goods and services.

This Resolution strengthens the process of updating and improving the competitive conditions of the developing economy as formulated by the Decree. The coming precedents will shed light on how these new rules are interpreted and applied to a specific case.