The Argentine Executive Power enacted Law No. 27,551, which introduces changes in the regulation of lease agreements and amendsArgentine Civil and Commercial Code. Its main aspects are:
1) It will be applicable for lease agreements entered into as from July 1st, 2020.
2) It extends the minimum term of the lease contracts to 3 (three) years.
3) It provides for additional guarantee options, such as bank guarantee, bond, surety insurance, salary receipt.
4) It establishes an annual mechanism for updating the price of the lease, based on inflation and salary increase rate.
5) Extraordinary expenses and taxes that are imposed on the property (such as the ABL or the ARBA real estate tax) shall be borne by landlord.
6) The guarantee deposit shall not exceed the equivalent of the first month’slease price.
7) The advance rent payment shall not exceed the equivalent of the first month of rent.
8) It forbids landlords to demand goodwill payments or equivalents.
9) The landlord must report the lease agreement’s existence to AFIP (Argentina Tax Authority).
10) It provides for the creation of the National Social Rental Program to adopt measures in order to facilitate access to decent housing.
11) It provides for the development of low-cost or free mechanisms for the resolution of conflicts derived from lease contracts.
Mariel Soledad Kesseler
Associate
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