AUTOMOTOR TRANSPORT

Decree 808/95

Amend Decree No. 958/92, which establishes the existing regulatory system in the area of inter-urban transport of passengers of national jurisdiction.

Bs. As. ,21/11/95

VISTO Issue No. 558-000239/95 of the record of the MINISTERY OF ECONOMY AND ARTWS AND PUBLIC SERVICES, and

CONSIDERING:

That Decree No. 958 of 16 June 1992 structured the existing regulatory system in the area of inter-urban transport of passengers of national jurisdiction, incorporating criteria for further deregulation in the area of service delivery and operation.

That the experience has shown the desirability of incorporating new aspects and modifying others in such a way that they can develop proper management of the passenger car system by road motor, all in order to preserve the public interest involved in the proper delivery of the services.

That, with regard to the procedure prior to the award of a public service permit, the experience collected and the background that is appreciated through all the regulations and doctrine of an administrative nature, they reflect that the most appropriate way of selecting the third party that is going to enter the transport system as a recipient of a permit, is the one that is carried out through a procedure that contains the notes of concurrence, advertising, equality and opposition, being therefore the most successful bid.

That the current text of Decree No. 958/92, while contemplating the possibility of applying to the procedure of public tendering, does not expressly enshrine such a procedure so that it is necessary to specify such circumstances.

That the general principle of the intransferability of the permits is governed by the assignment of permits unless there is express authorization from the Administrative Authority on Application.

That the basis for such a limitation is that it is of fundamental importance that the person of the co-contractor who must gather good backgrounds, both in terms of moral qualities, and his technical and financial capacity. Since the activity carried out by the Public Administration must tend to satisfy the general well-being, it is estimated that for the attainment of the same, the person who is a sub-worker must have a satisfactory record. Hence, having accepted as a permissionary to a particular individual who collects such a record, he cannot transfer his permission in whole or in part without the consent of the Public Administration, for it has the right and obligation to know who will be his collaborator and whether the background of the latter advises or does not relate to him.

On the other hand, the assignment or transfer of the permit contract entails placing a third party - the assignee - in the place of the assignor, so it is necessary to define in what framework of conditions it becomes feasible to grant such authorization, since in the case, an assignment of permit, in addition to replacing the person of the permissionary and placing it in its place generates the incorporation of the same to the system of national jurisdiction, and in that way, as has been said before

Consequently, it is appropriate to circumscribe the assignment to the hypothesis that the assignor and assignee were permisionary of interprovincial or international services.

At the same time, it is necessary for the Implementation Authority to undertake an assessment as to whether or not to authorize the assignment, on the basis of considering guidelines relating to the defence of competition, to avoid monopolization of supply and to maintain the diversification of operators.

It is therefore appropriate to include the relevant provision related to that topic.

It should be noted that in terms of lease or rental of vehicles, it should be noted that Article 12 of Decree No. 958/92 provides for the possibility that vehicles are owned by the operator, or that their possession is given under lease, asdato or sale with a domain booking agreement.

That the purpose pursued through the decree was to enable the lenders to access the use of units without the need to acquire the control of them, in the intelligence that would thus facilitate the operation of those units, in order to have the necessary rolling material for the greater supply of services that would take place on the basis of the flexibilization of the benefits that the decree itself promoted. In addition, in order not to overly increase the fleet, which could later become partially idle, in case of not continuing the provision of the deregulated services (see "free traffic"), which could validly be performed only for a minimum period of NUEVE (9) months.

That, however, such a criterion in practice was the subject of repeated deviations from the operators because, rather than using the figure of the rent or asdato to become of vehicles for express periods, such legal figures were resorted to to enable the carriers that were not in the system, to access the same in covert form, since instead of operating a real lease of vehicles, the owner of the

That this has led to a contractual practice that creates a location of mobility services for people, which is not acceptable because in the permission for their intuitive character, it is of fundamental importance that the person of the person who is the person of the person who must gather good backgrounds, both in terms of moral qualities and their technical and financial capacity.

That with this mechanism the lending companies that lease mobile park are operating as "agencieros" being holders of a few units, or none, and providing the service through the location of the transport service that implies a simple and flat outsourcing and transfer to third parties of the obligations as a provider.

That such form of procurement also generates tax distortions, thus affecting the conditions of competitiveness of the system, verifying that in the Tax on Value Added the rent of the piece of furniture, as provided for in Decree No. 958/92, is reached by the tax, while the location of the transport service is not taxed.

In addition, in the way of the eradication of distorting factors that may prevent the performance of services on an equal basis of competition, it is appropriate to promote the correct fulfilment of the obligations that fit the borrowers, as well as of the current regulations, so it considers that all the leases of the mobile park should have taxed the taxation, regardless of the situation of the inclusion or not of the service of the driving personnel in the contract.

In addition, the inclusion of driving personnel who are not dependent on the operator generates a strong additional distortion because the operator can receive a different trade union frame or have a self-employed worker, which generates a wage differential that is calculated between the TREINTA FOR SCIENTO (30 %) and the CUARENTA FOR SCIENTO (40 %), approximately with respect to the proprietary companies of the park with which they provide services.

That, therefore, in order to prevent these distortions, it is necessary to admit only the figure of leasing, and at the same time to establish that, in such a case, the driving personnel are in relation to the dependency of the licensed company, thus avoiding that subcontracts of transport services can be configured.

With regard to asdato, it should be noted that, in view of the fact that transport involves the development of a commercial activity with income generation, there is no reason to maintain such a figure which entails a free recruitment, which thus generates a lack of movement of funds, and thus prevents further verification of them, thereby detracting a possibility of control over compliance with the legal ends surrounding the benefits that are made with the respective assets.

As a result, the existence of such a contractual figure makes it impossible for the provision of services in the system of motor transport to be provided on an equal basis for competitiveness and transparency, as it does not have a tax base for being free of charge.

That, therefore, is in the presence of a situation which undoubtedly constitutes a concrete deviation from the letter and spirit of the norm, and which caused an undesirable effect that is necessary to correct.

That in another order of ideas, it should be noted that in more than one opportunity, it is in the presence of situations in fact, in which there would be an impossibility of keeping part of a carrier holding a public service permit, the continuity of such benefits with the number of frequencies that were appropriately authorized, without a detriment in the business economy.

That Decree No. 958/92, in Article 19, expressly envisages the adequacy of the permit in the field of public services by establishing that "... the Authority of Application may adapt in each permit the requirements of frequencies, schedules or transport capacity according to the variations observed in the offers of services or in the demands of transportation..."

That this possibility of adequacy would cover both the increase and the reduction of the supply of services in the segment that we occupy.

That in terms of the increase in the supply of services there is no inconvenience in admission.

That, in parallel, it can be stopped in the hypothesis of the reduction of frequencies in public services.

In this regard, it should not be forgotten that under the new regime established by Decree No. 958/92, a new scheme was created in the area of service delivery, which is characterized by different segments, each with its own particularities. Thus, while in the framework of the so-called Public Service the characters of continuity, regularity and compulsion, among others, in the field of the so-called "free traffic" services, such characters are morigerated, attentive that the maintenance of them must be observed obligatoryly during NUEVE (9) months, period in which even some of the specifications that are included in the provision (horaries, frequencies, etc.).

As a result, situations have arisen in which a public service carrier was able to see the demand for its services affected, attention to the increased supply generated as a result of the disruption of free traffic services.

That in such intelligence it appears that it has signs of reasonableness to admit that by reduction of demand or increase of additional supply of services, the carrier may decrease the volume of the benefits to his/her position.

That is why it would be appropriate to understand that within the scope of the term "information of public service permit", it would be appropriate to include the possibility of reducing the number of service frequencies that each permit includes.

For the above, it is appropriate to specify the terms contained in Decree No. 958/92 as to the subject described above.

In the area of car transport services for tourism, it is worth noting that the current wording of Decree No. 958/92, which admits a significant range of modalities for the provision of transport services for tourism, which authorizes other modalities additional to the regulations, means allowing the commission of situations in which tourist programming is easily simulable, giving rise to the covert provision of regular transport services without the specific authorization.

That this is true of operators that meet the required requirements, in terms of passenger lists, authorizations, offer regular services under the name of tourists with the sole inclusion of the mention of an accommodation, supported in the paragraph that authorizes "implementing other modes of transport" by always making departures in the same schedules and meeting the same routes.

As a result, it is necessary to specify what is currently permitted, in order to prevent operators of transport services by motor for tourism, using the liberalities of the current regulations, to carry out the simulation of tourist services using preset frequencies and fixed itineraries, these attributes of the regular service.

That through such benefits, beyond violating the modalities authorized by the existing legislation, illegitimate competitive advantages are developed with respect to the operators of public service, originated in: the non-institutionalization of the costs in which they incur (verbity, terminals), differential wage treatment for the labour force (by application of different trade unions), local advantages when they arrive and get out of sites other than terminals, with consequently greater costs

That to such factors, it should be added that these operators are not obliged to any duty of continuity in the services as are the public service operators who must keep the same beyond the variations that are presented in the supply - because of the existence of free traffic services, and of irregular and clandestine benefits- and in the demand, and by virtue of the elimination of cross-subsidy prevailing in the system of transport for long distance N°

For all this, in order to promote a healthy competition in the different transport markets, it is necessary to adapt the content of Article 37 of Decree No. 958/92, in order to achieve greater clarity in the norm and to enable proper control of its application.

Moreover, it is necessary to include the possibility of applying the expiry of the registration and/or authorization of that provider of transport services for tourism, to perform services in violation of the authorized modalities, without prejudice to the pecuniary penalties provided for in the current Penalties Regulations.

That in the area of free traffic services the basic principle of diversification and increase of the supply of public services, materialized by the existence without restriction of free traffic services, is encouraged to prevent the instability of supply, more severe consequences in the event of non-compliance with the times and conditions agreed for the provision of these services.

It is also desirable that all natural or legal persons operating inter-urban services of national jurisdiction possess a minimum property and constitute a guarantee for the purpose of strengthening the fulfilment of the obligations arising from the permit, authorization, authorization or registration in the respective Register.

That the present is given in the use of the powers conferred by Article 99 (2) of the National Constitution.

Therefore,

THE PRESIDENT OF THE ARGENTINA DECRETA NATION:

Article 1 - Replace Articles 12, 19, 21, 22, 28 and 37 of Decree No. 958/92, which shall read as follows:

"ARTICLE 12. - RADICATION. Vehicles that integrate the mobile park must be permanently and permanently registered in the ARGENTINA REPUBLIC, with the exception of those units intended exclusively for international transport services.

In the National Register, data relating to the ownership of vehicles that permit the identification of vehicles must be registered. The rolling material affecting the provision of the services must be owned by the owner in respect of the provision of the services, in order to accompany the title that accredits it, or to find itself under contract of "leasing" celebrated in its respect by the permissionary company. The purpose of the contract shall be to grant the use and enjoyment of the vehicle unit, and the price shall be reflected in a fixed amount previously stipulated, irrespective of the collection that revokes such use, and of any other erogation that the same effect.

In addition, the personnel involved in the conduct of vehicles included in a contract of "leasing" or in other contracts referred to in the following paragraph shall be dependent on the operator of the service. Failure to comply with the provisions of this paragraph shall, without proof to the contrary, presuppose the conduct of a passenger car service in violation of the authorized modalities, and shall be covered by such conduct in the provisions contained - for that type of infringement - in the current Criminality Regime.

Vehicles currently affected to the services whose possession takes place by virtue of legal figures other than those mentioned above may be used during the period of UN (1) year or until the time of the expiration of such vehicles in the event that the latter took place before.

The Implementing Authority may establish regulations for the impact of used-type vehicles on the provision of inter-urban and international passenger transport services, establishing their technical and design conditions, and the kinds of services in which they can be used.

Such provisions will include guidelines for special vehicles for transport of persons, for sport tourism benefits. "

"ARTICLE 19. - IMPLEMENTATION OF PERMISSION. Public service companies may apply for the adequacy of each permit, according to the variations observed in service offers or in transportation demands.

In this regard, they will be able to expand the traffic modalities that are exclusively interjurisdictional, without varying the categorization of services. This modification must be communicated in advance of TREINTA (30) days to the Application Authority and maintained for a minimum period of NUEVE (9) months. When the expansion involves intraprovincial traffics, the express authorization of the aforementioned Authority shall be required, subject to conformity of the provinces involved.

They may also increase the authorized frequencies of their services without limitation. Such increases may be lent over the entire or part of the authorized trace. Such modifications should be communicated in advance of TREINTA (30) days and maintained for a minimum period of THREE (3) months.

They may also request the reduction of frequencies in the public services they perform. This reduction will be equivalent to the added supply of public service or free traffic, if any, on the lines of the company concerned, measured in vehicles kilometers.

Once the frequency reduction has been granted, the company will not be able to apply for the provision of new public services or to request the realization of free traffic, in the corridor in question, in the period of DOCE (12) months following.

The Implementation Authority will therefore resolve, taking into account the above, the traffic modalities and any other element linked to that aspect, and may reject the request for reduction for reasons based on the public interest, in order to maintain the service where necessary."

"ARTICLE 21. - I'm sorry. The Implementing Authority shall grant permits for the exploitation of public services, subject to the substantiation of the public tendering procedure, on the basis of the requirements set out in the respective General and Particular Conditions. The above-mentioned Authority may award the services to all applicants submitted to the bidding process, subject to a finding of full compliance with the requirements set out in the solicitation of General Conditions, provided that the number of such persons is not excessive to meet the need for transportation in the new established line.

This Authority shall promote at least once a year the public tendering procedure referred to in this article."

"ARTICLE 22. - PUBLIC LICITATION. The procedure for public tendering shall be based on the general and private terms, which shall respectively contain different guidelines aimed at promoting increased supply, improving the quality of services, developing regional economies and, in addition, specific requirements for the public service to be granted. The requirements contained in these folds may not limit the entry into the market of new lenders."

"ARTICLE 28. - I'll take care of it. In order to ensure minimum conditions of regularity and safety to the user public, and without prejudice to seasonal benefits, free traffic services should be maintained for the period of NUEVE (9) months. In the event of the absence of an authorized free traffic service, or, having begun, was suspended prior to the term mentioned, in addition to the expiry of the service in question, the carrier involved will be disqualified from requesting new free traffic services during the period of DOS (2) years".

"ARTICULO 37. - Automotive transport services for tourism will be classified as:

(a) Receptive: this is done in the form set out in subparagraph (a) of the preceding article.

(b) Excursion: is the one who, anticipating the return of the contingent to the starting point, makes the transfer of the contingent to the visits and walks included as a complement in the tourist programming.

(c) Great Tourism: it is made to attend to tourist activities.

(d) Exclusive: it is carried out by institutions or entities of various kinds for the transfer of its members or beneficiaries either with own or contracted vehicles.

Car transport companies for tourism can perform only the modalities described in the previous article.

The transport operator shall perform transport services for the tourism which, using the permit, shall carry out transport benefits under the conditions provided for the public transport services by motor of passengers of an urban, suburban, interurban or international character, in violation of the modalities established and authorized in the present regime, shall be liable to the penalties provided for in the Regime of Penalties in force, without prejudice to the availability of the registration and

Art. 2° - Incorporate as Articles 25 bis, 25 ter and 48 bis of Decree No. 958/92:

"ARTICULO 25 bis. Exploitation permits for the public passenger transport service by inter-jurisdictional motor may not be fully or partially transferred without the express authorization of the SECRETARIAT FOR TRANSPORT. The physical or legal person who is a transferee shall meet the qualifications and conditions required to be the holder of a permit in order to ensure the efficiency and continuity of the service, and shall also assume to his or her responsibility all obligations which were the responsibility of the assignor, linked to the provision of the transport service.

The Applying Authority shall establish the requirements that must contain the respective transfer request."

ARTICLE 25 ter. - The transfer of assignment of permits shall be authorized only when it is materialized exclusively in permissionary companies of public services of national jurisdiction, whether interprovincial or international.

The Implementation Authority shall assess whether the requested transfer or assignment is aimed at the monopolization of the offer in the broker concerned, in which case it may refuse the respective request, in order to ensure the diversification of operators.

The transfer or assignment shall be understood to be improved once authorized by the Authority, through an act founded, duly notified and consented by the assignee. The assignor company may not apply to the selection procedure regarding new frequencies in the same trace to which the service which was transferred within a period of CINCO (5) years after the transfer was perfected".

"ARTICULO 48 bis. - PATRIMONIO, GARANTIAS, TRANSFORMATIONS AND FUSIONS. The Implementation Authority shall determine the minimum assets to be provided by public service providers, transport services for tourism and executive services, which shall be proportionate to the benefits that are performed in each case. It shall also establish the type and amount of the guarantees that they shall constitute according to those services, which shall be established in accordance with the same criterion of proportionality.

It will also enable the transformation of the current operators, guiding the integration process of them through management agreements, business collaboration, corporate mergers or other forms of business reorganization."

Art. 3° - Contact, post, give to the National Directorate of the Official Register and archvese. - MENEM. -Eduardo Bauzá. - Domingo F. Cavallo.