Taxpayers that would like to apply for the renewable energy sources regime should ensure that they submit their bids by September 5, 2016. Taxpayers that qualify for the regime may receive tax and customs benefits, such as accelerated depreciation and an exemption from import duties.

On July 26, 2016, Argentina's National Ministry of Energy and Mining published, in the Official Gazette, Resolution No. 136/2016, which summons bidders to tender in the national and international bidding process for the purchase in the wholesale electricity market of electric energy generated from renewable sources. The Resolution approved the bidding terms and conditions.

Background

In October 2015, Argentina enacted Law No. 27,191 (Law), which extended the promotional regime for the utilization of renewable energy sources (previously established by Law No. 26,190). The law also added new benefits to that regime (see Tax Alert 2015-2140 {}).

The Law includes the following tax and customs benefits: (1) accelerated depreciation for income tax purposes and early reimbursement of VAT; (2) carry-forward of net operating losses (NOLs) for 10 years; and (3) exemption from import duties on the import of new capital goods intended to be used in a promoted project.

In addition, by means of Decree No. 531/2016, Argentina issued guidance on the requirements to qualify for the tax benefits and clarifications on many other aspects of the regime (see Tax Alert 2016-784 {}).

Moreover, Resolution No. 72/2016 established the procedures by which companies should request the "Certificate of Inclusion" in the generation of renewable energy sources projects and enjoy the corresponding tax benefits (see Tax Alert 2016-1005 {}).

Resolution 136/2016

Resolution 136/2016 summoned bidders to tender in the national and international bidding process for the purchase in the wholesale electricity market of electric energy generated from renewable sources.

In their bids, bidders must include the detailed calculation of the tax benefits of the renewable energy sources promotional regime established by Laws 26,190 and 27,191 in accordance with the terms and conditions established in Resolution 136/2016.

Tax benefits will not be approved in larger sums than the ones expressed in the following table:

The administrator company of the wholesale electric market (CAMMESA) has been instructed to carry out the national and international bidding process. CAMMESA will submit bids made to the Ministry of Energy and Mining in order for it to prepare a report for each project. The benefits granted will depend on each project's characteristics and needs as determined by the Ministry of Energy and Mining.

The tax benefits granted to each project will be incorporated into the Certificate of Inclusion to be issued under the terms of Resolution 72/2016 before signing the supply contract for each awardee.

The deadline for submitting bids is September 5, 2016. The bids will be evaluated in September and the estimated adjudication date of the final bids is October 12, 2016.

This promotional regime provides interesting opportunities for multinational companies in this industry.

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