Cabotage Trading - New Fines Regime For Infringements

The Argentine Congress set forth a new regime for the fines to be imposed and procedures to be followed upon foreign vessels engaging in cabotage trading in breach of the Cabotage Act and its implementing regulations.

The Cabotage Act (Decree-law No. 19,492/1944, ratified by Law No.12,980), provides under article 1 that the navigation, communication and national cabotage trade must be made only by Argentine vessels. Under this regime, "national cabotage" means trade that is made exclusively between Argentine ports (article 55, subsection 10, of the Cabotage Act).

To engage in national cabotage, a foreign-flagged vessel must obtain either:

1. a waiver or temporary permission provided under article 6 of the Cabotage Act when, due to exceptional circumstances amounting to a force majeure event, it were not possible to supply a coastal area with essential goods or to perform a contract because no Argentine vessels are fit to render the service; or