Promotion Of The Development And Production Of Modern Biotechnology Benefits For Research Projects - Full Text Of The Norm

Original Language Title: PROMOCION DEL DESARROLLO Y PRODUCCION DE LA BIOTECNOLOGIA MODERNA BENEFICIOS PARA LOS PROYECTOS DE INVESTIGACION - Texto completo de la norma

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PROMOTION OF DEVELOPMENT AND PRODUCTION OF MODERNA BIOTECNOLOGY Law 26.270 Definitions. Benefits for research and/or development projects and projects for the production of goods and/or services. Common provisions. Criteria for project eligibility. Fondo de Estímulo a Nuevos Emprendimientos en Biotecnología Moderna. Industrial property. Violations and sanctions. General provisions. Posted: July 4, 2007 Partially enacted: July 25, 2007

The Senate and Chamber of Deputies

of the Argentine Nation gathered

in Congress, etc.

forcefully sanctioned

Law:

DEVELOPMENT AND PRODUCTION

OF THE MODERNA BIOTECNOLOGY

CHAPTER I

Definitions

ARTICLE 1 Object: The purpose of this Act is to promote the development and production of Modern Biotechnology throughout the national territory, with the scope and limitations set out therein and the regulatory rules consequent upon the Executive. This law shall have a validity of QUINCE (15) years after its promulgation. ARTICLE 2 . Definition: For the purposes of this law, "Modern biotechnology" means any technological application that, based on rational knowledge and scientific principles derived from biology, biochemistry, microbiology, bioinformatics, molecular biology and genetic engineering, uses living organisms or parts derived from them for the acquisition of goods and services, or for the substantial improvement of productive processes and/or substances, understood by means of innovation,

A product or process shall be considered as a biotechnological basis when the elements described in the preceding paragraph are an integral part of that product or process, and its use is also indispensable for obtaining that product or for the implementation of that process.

Article 3 . Beneficiaries: The benefits of this law may be sought by natural or legal persons incorporated in the Argentine Republic who submit research and development projects based on the application of modern biotechnology in the terms of Article 2 of this rule.

In addition, individuals or legal entities established in the Argentine Republic may apply for the benefits of this law to submit projects for the application or implementation of modern biotechnology for the production of goods and/or services or for the improvement of processes and/or products.

Applicants will be able to present more than one project and receive the corresponding benefits.

The beneficiaries of this law shall develop the activities described above in the country and on their own account, and shall be in the normal course of their tax and predictive obligations to access and maintain the benefit.

ARTICLE 4 The productive projects that are developed on the basis of a patent previously granted to the entry into force of this measure are excluded from the scope of this law. Production projects resulting from research and development activities carried out abroad are also excluded.

Nor will projects that involve products and/or processes that are obtained or carried out through conventional and widely known productive applications be beneficiaries of this law through processes that use organisms such as are presented in nature or the acquisition of new varieties through conventional genetic cross-cutting or conventional multiplication.

5o Please refer to the National Register for the Promotion of Modern Biotechnology, for the registration of projects approved by the Implementing Authority. The registration in the Register will result in the granting of a certificate issued by the Application Authority, which will grant the holder of the registered project the status of beneficiary of the present regime.

CHAPTER II

Benefits for research projects

and/or development

ARTICLE 6 The holders of research and/or development projects approved under this Act shall enjoy the following benefits:

(a) Accelerated amortization in the Gain Tax for capital goods, special equipment, parts or components of such goods, new, acquired for the project promoted.

Such amortizations shall be practiced from the fiscal period of the granting of good, in accordance with the rules provided for in article 84 of the Law on Taxation of Gains, a text ordained in 1997 and its modifications, in the conditions established by the regulation;

(b) Advance return of the Attached Value Tax for the acquisition of the assets referred to in subparagraph (a), which had been invoiced to the project holders. It shall be credited against other taxes by the Federal Public Income Administration, autarchical entity within the Ministry of Economy and Production, or, failing, shall be returned, in both cases, within the time limit stipulated in the act of approval of the project and under the conditions and with the guarantees established by the regulation.

Such accreditation or return shall be made to the extent that the amount of such accreditation is not to be absorbed by the respective tax debits originating from the development of the activity;

(c) Conversion of the amount of social security contributions that they have actually paid for the social security systems and subsystems provided for in Acts 19.032 (National Institute of Social Services for Retired and Pensioned), 24,013 (Employment Act) and 24,241 (Integrated Pension and Pension System) to the project concerned;

(d) The assets referred to in subparagraph (a) shall not constitute the basis for the imposition of the Minimum Wage Tax, established by Act No. 25.063, or the one that supplements, modifies or replaces it in the future, beginning with the approval of the project by the Implementation Authority and during the period established by it;

(e) Conversion in Tax Credit Bonus of CINCUENTA BY CIENTO (50 per cent) of expenditures for contracting research and development services with relevant institutions of the national public science, technology and innovation system.

The Tax Credit Bonuses referred to in this article are of an intransferable nature and will last TEN (10) years from the date of approval of the project.

CHAPTER III

Benefits for production projects

of goods and/or services

ARTICLE 7 The holders of the goods and/or services projects approved under this Act shall enjoy the following benefits:

(a) Accelerated amortization in the Gain Tax for capital goods, special equipment, parts or components of such goods, new, acquired for the project promoted.

Such amortizations shall be practiced from the fiscal period of the granting of good, in accordance with the rules provided for in article 84 of the Law on Taxation of Gains, a text ordained in 1997 and its modifications, in the conditions established by the regulation;

(b) Advance return of the Attached Value Tax for the acquisition of the assets referred to in subparagraph (a), which had been invoiced to the project holders. It shall be credited against other taxes by the Federal Public Income Administration, autarchical entity within the Ministry of Economy and Production or, failing, shall be returned in both cases, within the time limit stipulated in the act of approval of the project under the conditions and with the guarantees established by the regulation. Such accreditation or return shall be made to the extent that the amount of such accreditation is not to be absorbed by the respective tax debits originating from the development of the activity;

(c) Conversion to tax credit bonds of CINCUENTA BY CIENTO (50%) of the amount of contributions to social security that they have actually paid for the social security systems and subsystems provided for in Laws 19.032 (National Institute of Social Services for Jubilee and Pensioners), 24.013 (Employment Act), and 24,241 (Integrated Pension and Pension System), on payroll;

(d) The assets referred to in subparagraph (a) shall not form the basis for the imposition of the Minimum Wage Tax, established by Act No. 25.063 or supplementing, modifying or replacing it in the future, based on the approval of the project by the Implementation Authority and during the period established by it.

The Tax Credit Bonuses referred to in this article are of an intransferable nature and will last TEN (10) years from the date of approval of the project.

CHAPTER IV

Common provisions for Chapters II and III

ARTICLE 8 Property acquired under Chapters II and III of this Act shall be affected by the proposed project as long as it is implemented. Article 9 The Tax Credit Bonuses established in Articles 6 and 7 of this Law shall not be considered for the purpose of establishing the taxable basis for the Gain Tax.

Beneficiaries may use such Tax Credit Bonuses for the cancellation of national taxes and advances, perceptions and retentions, if any.

The Tax Credit Bonuses may not be used to cancel debts prior to the effective approval of the project in the terms of this law and, in no case, any tax balances in their favour will result in refunds or returns by the State.

The Tax Credit Bonuses issued by the Application Authority that are applied in a fiscal year may be charged to subsequent fiscal periods, up to a maximum period of TEN (10) years, counted from the issuance of the same.

ARTICLE 10. Until a tax quota is established, approved projects will have access to the benefits set out in Chapters II and III of this Law.

Starting with the establishment of the tax quota, the Application Authority will call for a project contest. The selection mechanism shall take into account the criteria set out in Chapter V of this Law.

ARTICLE 11. The beneficiaries of this law shall bear their accounting in such a manner that allows the determination and evaluation separately from the project promoted by the rest of the activities carried out by them through affidavits that take into account the status of the advance of the projects.

The imputation of expenses shared with activities other than those promoted will be constrained with respect to objective distribution criteria.

ARTICLE 12. The benefits to which Chapters II and III relate will be granted for a maximum period of TEN (10) years. The maintenance of the benefit shall be subject to the approval of annual audits by the Implementation Authority. The scope and modality of these shall be determined by the regulation.

CHAPTER V

Criteria for project eligibility

ARTICLE 13. Only projects involving a strong technological impact will be approved and the holders will demonstrate technical solvency and economic and/or financial capacity to carry out them and comply with the biosafety requirements established by the current regulations. To that end, projects that contain innovation content with industrial and/or agricultural application, economic and social impact, reduced production costs, increased productivity, or other effects that are considered relevant by the Implementation Authority will be considered.

Up to a maximum of UN (1) project per year will be awarded for each individual; and a maximum of THREE (3) projects per year for each legal person. In the event that surpluses are available within the established fiscal quota, the Application Authority may increase the ceiling.

On the basis of the imposition of the fiscal quota, the Implementation Authority shall grant to the approved projects the benefits provided for in Chapters II and III, as appropriate, in accordance with the order of priority indicating the merit and convenience of the same, to the projects which, in addition to the provisions of the first paragraph:

(a) They respond to priorities set by the national government or, where appropriate, the provincial governments, for biotechnological innovation and development applied to sustainable development based on the needs of the Argentine population;

(b) Projects are directly linked to the formation and development of micro and small technology-based enterprises of national origin and with real domicile in the country;

(c) Increase in the use of human resources;

(d) Have a local or regional socio-economic impact and transmit these effects to other sectors of the economy;

(e) Increase the competitiveness of goods or services.

ARTICLE 14. Projects that are not met by safety and/or quality standards set out in the relevant legislation shall, from the first year of the development of the process and/or product benefited by this regime, obtain a quality certificate as established by the Implementation Authority.

CHAPTER VI

Stimulus Fund to New Entrepreneurships

in Modern Biotechnology

ARTICLE 15. Trust the Fund for Enactment to New Emprenditions in Modern Biotechnology, which will be intended to finance the initial capital contributions of new entrepreneurs, who are not in a position to access the benefits provided for in Chapters II and III of this Law. ARTICLE 16. The Fund of Entry to New Entrepreneurships in Modern Biotechnology will consist of:

(a) Resources allocated annually through the National Public Service General Budget Act;

(b) Legacy income or donations;

(c) Non-refundable funds provided by multilateral agencies, foreign Governments or non-governmental organizations;

(d) Resources from other sources;

(e) Funds reintegrated by entrepreneurs benefited by the stimuli provided by this law.

ARTICLE 17. The administration of the Stimulus Fund to New Emprenditions in Modern Biotechnology will be the responsibility of the Authority for the Application of this Law.

The Applicable Authority shall define the criteria for the distribution of funds accredited in the Fund for Enactment to New Emprenditions in Modern Biotechnology, as set out in Article 13 of this Law.

CHAPTER VII

Industrial property

ARTICLE 18. The beneficiaries undertake to submit, within a period not exceeding one (1) year since the development of an invention was completed in the framework of this law, the corresponding patent application in the National Institute of Industrial Property, decentralized within the scope of the Ministry of Industry, Trade and Small and Medium-sized Company of the Ministry of Economy and Production, in a priority form to any other jurisdiction, provided that it meets the requirements of the first patented article.

If the invention developed was a new phytogenetic variety, the ownership of it must be registered in the National Register of the Property of Cultivators, as stipulated in Acts 20,247 and 24,376 and the regulatory decree 2183/91.

When the invention does not meet the patentability requirements required by the national law, but meets the patentability requirements required by other countries, the holder must submit the corresponding patent title application within a period not exceeding UN (1) year after such invention is granted.

If the invention developed was a phytogenetic variety, not protected under Laws 20,247 and 24,376 and Regulation Decree 2183/ 91, but which may be protected in other countries under some intellectual property title, the holder must submit the application for the corresponding title within the maximum period of UN (1) year after such invention was granted.

CHAPTER VIII

Violations and sanctions

ARTICLE 19. Failure to comply with the provisions of this Act and with the regulatory rules that are issued for this purpose will result in the following penalties, without prejudice to the application of Acts 11.683 (t.o. Decree 812/98), 22,415 and 24,769 and their amendments:

1. Revocation of the registration of the project in the Register established in Article 5 of this Law.

2. Return of the unregistered taxes on the basis of Chapters II and III, with more interest.

3. Disqualification of the project holder to re-register in the Register established in Article 5 of this Law.

CHAPTER IX

General provisions

ARTICLE 20. The Ministry of Economy and Production shall be the Authority for the Application of this Law. ARTICLE 21. Consider the Advisory Committee for the Promotion of Modern Biotechnology, whose role will be to act as an advisory body to the Implementation Authority.

The Ministry of Agriculture and the Ministry of Agriculture (1)

The members of this Commission shall act adhonorem.

The opinions prepared by this Advisory Committee shall be binding, duly founded and non-binding.

ARTICLE 22. From the second year of the entry into force of this Act, the corresponding tax quota may be established in the General Budget Act of the National Civil Service.

The national executive branch shall establish annually the distribution of tax quotas for the benefits set out in Chapters II and III of this Law.

ARTICLE 23. The National Council for Scientific and Technical Research, autarchical body within the Ministry of Education, Science, Technology and Productive Innovation Secretariat, Science and Technology and the autarchical agencies of the National Civil Service, may grant licences without possession to the researchers involved in projects promoted by this Act, for the time required to develop such projects.

Investigators covered by this article shall remain in institutions that grant them the benefit for a period equal to the end of the project.

ARTICLE 24. Invite the provinces and the Autonomous City of Buenos Aires to dictate promotional standards similar to this law. ARTICLE 25. Please refer to the Authority of Implementation to conclude agreements with the Autonomous City of Buenos Aires and the provinces with the aim of facilitating and guaranteeing to the stakeholders of each jurisdiction within the meaning of article 3 of this Act the possibility of access to this regime. ARTICLE 26. Contact the Executive.

IN THE SESSION OF THE ARGENTINE CONGRESS, IN GOOD AIRES, TO THE FOUR DAYS OF THE JULY OF THE YEAR DOS MIL SIETE.

# 26,270

ALBERTO E. BALESTRINI. . MARCELO E. LOPEZ ARIAS. . Enrique Hidalgo. . Juan H. Estrada.

Decree 983/2007

Bs. As., 25/7/2007

VISTO Issue No. S01:0252772/2007 of the Register of MINISTERY OF ECONOMY AND PRODUCTION and the Draft Law registered under No. 26,270, sanctioned by the HONORABLE CONGRESS OF NATION on 4 July 2007 and

CONSIDERING:

That the Bill cited in the Hittite promotes the development and production of Modern Biotechnology throughout the National Territory.

That Chapters II and III of Bill No. 26,270 provide for the tax benefits enjoyed by the holders of research and/or development projects and the production of goods and/or services, respectively.

That, as provided for in Articles 6 and 7 of the draft law sanctioned, certain benefits to which the holders of the above-mentioned projects shall be made by the use of Tax Credit Bonuses, providing both articles in their last paragraph that those Bonuses shall have a duration of TEN (10) years from the date of approval of the project.

That, on the other hand, Article 9 of the sanctioned rule regulates provisions applicable to the aforementioned Tax Credit Bonuses, stating that the "...which issued the Implementing Authority that are applied in a fiscal period, may be charged to subsequent fiscal periods, up to a maximum period of TEN (10) years, counted from the issuance of the same. ".

That the implementation of a promotional benefit, as far as the conditions and time frames for its enjoyment are concerned, requires the regulation of application, clarity and precision in its terms, so that the objectives that inspired the creation of the regime can be met and the effective implementation of the projects involved can be enabled.

That, in accordance with the above requirements, the forecasts relating to the duration of the Tax Credit Bonuses are deemed incompatible, as referred to in Articles 6 and 7, as set out in Article 9 of the Bill No. 26,270.

That, on the basis of the above, it is necessary to observe in the last paragraph of Articles 6th and 7th of the project the expression: "...and will last TEN (10) years counted from the date of approval of the project." Just as it is also necessary to observe from the last paragraph of Article 9 the expression: "...that are applied in a fiscal exercise...".

That the proposed measure does not alter the spirit or unity of the Draft Law sanctioned by the HONORABLE CONGRESS OF NATION.

That the Directorate-General for Legal Affairs of the Ministry of Economic Affairs And PRODUCTION has taken the intervention that belongs to it.

That the NATIONAL EXECUTIVE POWER is empowered to issue this decree pursuant to Article 80 of the NATIONAL CONSTITUTION.

Therefore,

THE PRESIDENT OF THE ARGENTINA NATION IN GENERAL AGREEMENT OF MINISTERS

RIGHT:

Article 1 Note in the last paragraph of Article 6 of the Draft Law registered under No. 26,270 the expression: "...and shall last TEN (10) years from the date of approval of the project. ". Art. 2o Note in the last paragraph of Article 7 of the Bill registered under No. 26,270 the expression: "...and will last TEN (10) years from the date of approval of the project. ". Art. 3o Note in the last paragraph of Article 9 of the Bill registered under No. 26,270 the expression "...that they may be applied in a fiscal exercise...". Art. 4o With the exceptions set out in the preceding articles, please amend, and refer to the National Law Bill registered under No. 26,270. Art. 5o Note the HONORABLE CONGRESS OF NATION. Art. 6th Contact, post, give to the National Directorate of the Official Register and archvese. . KIRCHNER. . Alberto A. Fernández. Aníbal D. Fernández. . Nilda C. Garré. . Miguel G. Peirano. . Julio M. De Vido. . Alberto J. B. Iribarne. . Carlos A. Tomada. . Alicia M. Kirchner. . Ginés M. González García. . Daniel F. Filmus.