Interactions, scope and tensions in the new cycle of investment and reform of the State in Argentina

The current privatisation agenda and the redesign of the role of the State have reignited a classic debate in public economic law: how to structure the relationship between the public and private sectors in order to attract investment, modernise infrastructure and sustain essential services, without unsustainably compromising fiscal accounts.

Four distinct but interrelated themes converge in this scenario:

• Privatisation, as a policy of state reorganisation.
• Concessions, as a historical instrument for delegating public works and services.
• Public-private partnership (PPP) projects, as a vehicle for large-scale infrastructure with private financing.
• RIGI, as a macro regime for promotion with long-term benefits and regulatory stability.

1) Concessions: the "classic vehicle" returns to centre stage

Concessions allow the state to retain ownership of assets used for public purposes, but to delegate their execution, operation, or both to a private operator under a public law regime with standards, investments, tariffs, and control.

Their sectoral scope is cross-cutting (transport, energy, sanitation, waste, communications, social infrastructure), and in the new cycle of reforms they are once again a key legal support for privatisation, regulatory modernisation and opening up to private investment.

2) PPP: comprehensive infrastructure and risk transfer

The PPP regime (Law 27,328) was designed for large-scale, long-term projects, where the private sector takes on the integrated design, construction, financing, operation and maintenance, with compensation via state, user or mixed payments.

Its distinctive feature is that private financing is an essential element, and the logic of risk allocation (construction, demand, availability) seeks to reconcile investment with fiscal sustainability.

3) RIGI: regulatory stability and benefits for 30 years

The RIGI (Law 27,742) is presented as an umbrella for promoting large-scale investments in strategic sectors, combining tax, exchange and customs benefits with long-term regulatory stability.

From the perspective of infrastructure and public services, the RIGI could operate in a complementary manner with concessions and PPPs: the same project could be structured as a concession or PPP and, at the same time, benefit from the RIGI to maximise predictability and investor appeal. The key lies in how the specifications, financing and contracts are designed.

4) Privatisation and state-owned enterprises: the underlying debate

The analysis is completed with a discussion of the entrepreneurial state and the principle of subsidiarity. State-owned enterprises have been described as "state enclaves in private territory" due to the tension between their corporate form and public purpose.

From this perspective, privatisation is understood as a reinterpretation of the role of the state: the state withdraws from activities that the market could take on and focuses on planning, regulating, supervising and protecting users and consumers.

5) Interaction and 'open questions': the critical point

The coexistence of privatisation, concessions, PPPs and RIGI may be consistent and even desirable if they are conceived as complementary regimes. However, the article emphasises that, in practice, relevant questions arise:

• Can a contractor under a PPP simultaneously be covered by the RIGI?
• Is it advisable to first obtain RIGI 'protection' and then compete in a concession or PPP tender?
• Do the incentives add up harmoniously or do they generate overlaps, distortions or fiscal conflicts?

The conclusion here is deliberately cautious: there are still more questions than answers, as is typical of regulations that have not yet been fully implemented and whose impact will depend on the specific design of each project.

Conclusion

The new cycle points to a State that ceases to operate directly and focuses on regulation, supervision and control, while the private sector increasingly takes on the operation and financing of strategic infrastructure. The challenge will be to avoid contradictions between regimes, guarantee transparency and competition, and ensure continuity and quality of services so that these tools fulfil their purpose: genuine investment, better infrastructure and development with fiscal responsibility.

Article written by Constanza Cassino, partner at ECIJA Argentina.