The Argentine Government will seek to allow foreign-flagged vessels to transport cargo between Argentine ports, an activity currently reserved primarily for national vessels.
The measure, included in the preliminary draft of the Deregulation Bill prepared by the Ministry of Deregulation and State Transformation, aims to increase competition in maritime and river transport in order to lower logistical costs — one of the main factors affecting the competitiveness of Argentine agriculture and exports.
Currently, the transport of cargo between Argentine ports is reserved, with some exceptions, for vessels flying the national flag. The proposal seeks to flexibilize this system and allow foreign shipowners to provide cabotage services simply by notifying the competent authority of their entry.
The logic behind the reform is to increase competition in maritime and river transport to expand the supply of services, improve vessel availability, and reduce the costs of moving goods within the country — an especially relevant aspect for export supply chains that depend on the Paraná-Paraguay Waterway and Argentine ports.
The initiative, however, establishes some conditions for foreign companies. The vessels will be able to operate freely, but they must progressively incorporate Argentine or resident crew members as their stay in the country is extended.
In addition to opening the market, the preliminary draft includes a series of measures aimed at strengthening water-based transport.
Among them, it contemplates tax benefits for cabotage activity, simplifies access to tax-exempt fuel for national vessels, and promotes investments aimed at modernizing the merchant fleet and port infrastructure.
From the Government’s perspective, these measures would improve the efficiency of the Argentine logistical system and reduce one of the costs that most affects export competitiveness.
A Broader Reform
The modification of the cabotage regime is part of a much larger package of deregulations promoted by the Ministry of Deregulation. The preliminary draft also proposes eliminating and modifying various regulations related to veterinary medicines, reforming legislation on alcohols and wines, and redefining different sanitary control systems. Among the most notable points are the elimination of mandatory contributions to IPCVA, the dissolution of COVIAR, and especially the repeal of the Rental Law.
The stated objective is to reduce regulatory burdens, eliminate mandatory contributions, simplify procedures, and promote greater competition among private actors.
If approved by Congress, the initiative would represent one of the deepest regulatory reforms for the agricultural sector in recent decades, with effects on logistics, commercialization, sectoral promotion, and the institutional organization of several of the country’s main productive chains.