Search for:


Should a foreign investor have its assets expropriated (whether directly, or through creeping expropriation or regulatory encroachment), a qualifying investor would have claims for unlawful expropriation and breach of the FET standard under any applicable investment treaties. A map of those treaties to which Argentina is a party can be seen HERE. The main advantage of being able to pursue such an investment treaty claim would be to avoid having to sue the Argentinian authorities in their own courts. In addition, investors may have access to claims in the domestic courts.

Constitutional protection of property rights

Under Argentine law, shares in a private company are constitutionally protected property rights, and can only be expropriated through the enactment of an expropriation law by the National Congress with previous proper compensation and a formal declaration of the public use or utility involved (National Constitution, art. 17).

Expropriations Law No. 21,499

Expropriations Law No. 21,499 further regulates this formal expropriation proceeding. In general terms, after the National Congress enacts the law, the National Executive and the expropriated party must agree on the value and, absent such agreement, an official authority must appraise the property’s value, which must be previously paid or deposited by the National Executive prior to taking possession over the property.

However, this procedure can present some setbacks in certain cases, most notably due to the fact that Expropriations Law No. 21,499 prohibits the payment of compensation in respect of loss of profits—a key compensation concept in the expropriation of profit-making companies.

Official appraisals may therefore widely vary depending on the methodology used to ascertain the present value of the expropriated shares (e.g., in the expropriation of Spanish-owned airline Aerolíneas Argentinas, appraising authorities reached the conclusion that the value was negative due to its current capital-debt structure, and therefore no compensation had to be paid).

Nonetheless, the legal system allows for a judicial procedure to be initiated to discuss the appraisal methodology and assumptions.

Additionally, there are indirect or “creeping” ways nationalization may take place, such as the enactment of legislative or administrative regulations that substantially limit the exercise of the owner’s rights. For these cases, Argentine law grants several remedies that may apply depending on the case.

For instance, the owner may seek to consider such a case as an “abnormal” expropriation and thus go to court to seek to obtain a full expropriation, with payment of the compensation, under the “abnormal” expropriation proceeding regulated by Expropriations Law No. 21,499 and which is similar to the one described above.

Alternatively, the owner may seek annulment of such regulations and full compensation of all losses suffered (including loss of profits) under State Liability Law No. 26,944. In such a case, it would have to demonstrate that such regulations are unconstitutional. In addition, before reaching a court it would have to submit a prior administrative claim according to Administrative Procedures Law No. 19,549.

Finally, if the regulations are not nullified, still the owner may seek compensation under State Liability Law No. 26,944, but without being able to obtain loss of profits and also having to meet a higher evidentiary standard (i.e., having to demonstrate that the regulations imposed a “special sacrifice” over the owner, different than that to the rest of society or similar market players).

Administrative proceedings

Another manner in which nationalization can take place is through the unilateral revocation of licenses, permits or contracts granted to the investor authorizing a specific activity or service (this is especially the case for public utility companies, mostly natural gas and electricity distributors or transporters, as well as telecommunication operators).

In these cases, such decisions must be challenged in a previous administrative procedure, and only once the latter is completed can the expropriated licensee, permittee or contractor submit its challenge in court.

As a final note, in all these cases the National Government must be sued before Federal Courts, which in turn tend to defer in favour of the National Government’s policies and decisions, unless explicit and gross violations to applicable laws took place.


Claudia is a partner at Baker McKenzie. Since 2010, she heads the Dispute Resolution practice in Colombia. In 2018, she started leading the practice in Latin America and is currently the Global Chair of the Firm's Dispute Resolution Group. Claudia is the Chair of the Arbitration and ADR Commission of ICC in Colombia. She is also a listed arbitrator of the panel of arbitrators of the Center of Arbitration of the Chamber of Commerce of Bogotá for both, domestic and international arbitration; and a listed arbitrator of the Panel of Arbitrators of the Shanghai International Economic and Trade Arbitration Commission (Shanghai International Arbitration Center). Claudia is a highly-regarded expert in transnational litigation and international arbitration. She has over 20 years of extensive experience handling complex litigations and arbitrations related to construction and infrastructure projects, post-acquisition disputes, disputes in the energy sector, distribution and supply agreements, unfair competition, product liability, insolvency and general breach of contract. Claudia has been ranked by Chambers & Partners and Legal 500 as an expert in the field of dispute resolution. According to these publications, the group led by Claudia "'generates absolute confidence’ according to clients who highlight the team’s ‘efficiency, agility and commitment’, ‘broad market knowledge’, and ‘careful follow-up of cases", pointing that "It is led by the ‘expert’ and ‘deeply involved’ Claudia Benavides whose ‘intelligence, diligence and acuity to foresee legal risks’, make her a stand out legal adviser.” Chambers and Partners Latin America notes that "Claudia Ines Benavides Galvis is praised by interviewees for her "wide knowledge of the area, precision and in-depth background" in the field of dispute resolution." She has been ranked Band 2 in Chambers & Partners' individual ranking and in the "Leading Lawyer" listing by The Legal 500. The prestigious publication Who's Who Legal: Arbitration describes her as one of the world experts in arbitration and Benchmark Litigation featured her in the Top 25 Latam Women in Litigation listing. The team led by Claudia is ranked Tier 1 in the prestigious directory The Legal 500. Claudia has been actively involved with academia. She regularly speaks in important national and international conferences and she is the author of several articles related to her practice.


Luis E. Dates is a partner in Baker McKenzie's Buenos Aires office. He practices public law, litigation, alternative dispute resolution and international and domestic arbitration. He has represented and continues to represent several clients in ad hoc arbitral proceedings, as well as in proceedings administered by local arbitral institutions, such as the Buenos Aires Stock Exchange Market Arbitral Tribunal, the Buenos Aires Grain Market Arbitral Tribunal and the Private Center for Mediation and Arbitration and international institutions, as the ICC.


Maria del Carmen Tovar has participated in the process to promote private investment in companies and concessions both as counsel to the government and to bidders. She is recognized for her extensive knowledge of processes and contracts involving the State. She regularly acts as counsel in national and international arbitrations related to investments and public services and public works. She acts for and against states and state bodies, with particular experience in the energy sector and large infrastructure projects. She has acted on investor-state disputes under ICSID, UNCITRAL Arbitration Rules. She often advises investors on treaty planning.


Santiago Maqueda is a partner in Baker McKenzie's Buenos Aires office. He practices public law, litigation, alternative dispute resolution and international and domestic arbitration.


Jorge Valencia is a member of the Dispute Resolution team in the Bogota office of Baker McKenzie where he focuses on domestic and international arbitration. He has more than nine years of experience in litigation and arbitration involving construction, public utilities, finance, oil and gas, and commercial contracts. He worked for two years in the international dispute resolution and white collar practice groups of a New York law firm, advising clients in investment arbitration matters, transnational disputes and white collar investigations under the Foreign Corrupt Practices Act in the United States, Latin America and Africa. Jorge has worked on arbitration proceedings under the ICC, ICSID and UNCITRAL rules in the construction, oil and gas, and finance sectors. Jorge has also advised in domestic arbitration before the Chamber of Commerce of Bogota in relation to public procurement, public utilities, construction and energy. Jorge Valencia can be reached at [email protected] and +57 (1) 634-1550.


Natalia Mori is an associate in the Firm's North American Dispute Resolution group in New York. Prior to joining Baker McKenzie's New York office, Natalia was a member of the Estudio Echecopar team, a member firm of Baker McKenzie International based in Lima, Peru. Natalia has been part of the Regulatory team in Estudio Echecopar for the past seven years. Aside from advising clients on Administrative Law matters, Natalia also has experience in litigation and arbitration, advising clients in administrative proceedings and domestic and international arbitrations. Natalia regularly advises on Public-Private Partnerships and Public Procurement matters. She is also heavily involved in all manner of administrative law advisory, including the drafting of regulations and laws, representing clients in sanctioning proceedings against government agencies and advising on Municipal law matters and proceedings. Additionally, Natalia has experience in both domestic and international arbitration, mainly related to disputes arising out of government contracts. Natalia Mori can be reached at [email protected] and +51 1 618 8411.