Public procurement: local preference is gone

What changed

DNU 70/2023 dismantles the national-preference regime in public procurement: art. 10 (Title II, Economic Deregulation) repeals arts. 1 to 21 and 24 to 30 inclusive of Law 27.437 (Compre Argentino and Supplier Development) and art. 38 (Title III, State Reform) repeals arts. 1 to 20 and 23 to 28 inclusive of Law 18.875 (Compre Nacional). It is a PARTIAL repeal: the non-enumerated articles of each law survive (in 27.437, arts. 22-23 and 31; in 18.875, arts. 21-22 and 29), but the practical effect is to eliminate the State's obligation to prefer national bidders/inputs in its procurement. verif · Dec 20, 2023 ↗

In force

Signed on 12/20/2023 and published in the Official Gazette on 12/21/2023 (notice 301122). General validity of the DNU 8 calendar days after publication (12/29/2023). The DNU was rejected by the Senate (Mar-2024) but the Chamber of Deputies never considered it; under Law 26.122 a DNU only loses validity if both chambers reject it, so these repeals remain firm. verif · Dec 21, 2023 ↗

Who it affects

National State bodies and their public procurement (the mandatory preference for national bidders and inputs stops applying); national suppliers who enjoyed the preference margin; and foreign importers and suppliers who become enabled to compete on equal terms in State procurement. verif · Dec 20, 2023 ↗

The norm

DNU 70/2023 (DNU-2023-70-APN-PTE) "Bases para la Reconstrucción de la Economía Argentina" (Bases for the Reconstruction of the Argentine Economy), Title II, arts. 10 and 38. A Decreto de Necesidad y Urgencia (emergency decree) of the national Executive. verif · Dec 20, 2023 ↗

Our reading

The State stops choosing by decree whom to buy from: the mandatory national preference falls and public procurement returns to being decided by price and quality. It is textbook deregulation (R4 · opening and deregulation): less sector privilege, more competition and less fiscal overcost in each contract. What we watch: it is a DNU rejected by the Senate and not yet considered by the Chamber of Deputies, so its ultimate firmness depends on the Chamber not overturning it or on an eventual Supreme Court ruling. thesis

Where it lands, province by province1

Neuquén The federal government stops preferring national suppliers in its own purchases, but Neuquén repealed nothing: its local content law, its public procurement law and the 20% tax credit for hiring Neuquén suppliers all remain. The local contracting floor is now provincial, not federal — what the nation lets go, the province keeps. mixed federal-provincial tension thesis

Public procurement: the national preference falls

What changed and who it applies to

Our reading

Where it lands, province by province1

The other rules on this subject36

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