Initiative of the Federal Executive With a Draft Decree Reforming, Adding and Repealing Various Administrative Provisions.

On March 24, 2023, the federal executive branch, presented an initiative with a draft decree by means of which several administrative provisions were amended, added and repealed, among which we mention the following: Federal Law of Administrative Procedure, Federal Law of Parastatal Entities, Law of Acquisitions, Leasing and Services of the Public Sector, Law of Public Works and Related Services, among others.

The proposed amendments by the Federal Branch, as they mentioned in the considerations of the initiative, mainly seek to safeguard the public, general or social interest, the preservation of common goods, the security and integrity of persons and national institutions, safeguard of public finances, to strengthen the federal public administration, the foregoing by reversing acts of corruption and strengthening legal figures that allow the public administration to temporarily suspend and early termination of contracts in cases of general interest, justified causes or if damage may be caused to the State.

Regarding the reversal of acts of corruption, the initiative proposes to strengthen the figures of the “Trial of Lesivity” and the “Nullity Procedure”, this initiative proposes to amend Articles 1-A, 2nd and 13th of the Federal Law of Contentious Administrative Procedure and 3rd of the Organic Law of the Federal Court of Administrative Justice to establish the definition of the trial of lesivity, as well as to set forth the cases in which an administrative resolution may be considered illegal.

Likewise, it is proposed to complement the figure of the “Nullity Proceeding” to establish its proceeding, when the administrative act is issued without meeting the elements of legitimacy provided by the law itself, and the scope of its effects once the nullity resolution has been resolved.

In order to safeguard public finance, the Federal Branch indicates, that this law reform initiative seeks to protect public resources from abuse by establishing the revocation of administrative acts due to supervening events that affect the public, general or social interest by strengthening the procurement of goods and services at the national and international level, through the mandatory inclusion of the “Exorbitant Clause”.

It is proposed to amend Section VI of Article 11 of the Federal Law of Administrative Procedure to establish as grounds for the revocation of concessions, permits, authorizations or licenses, supervening events that affect the public, general or social interest, or cause any type of economic, social, environmental or any other type of impact.

Finally, it is suggested to amend Articles 19, fourth paragraph of the General Law of National Assets and 1st and 13th of the Federal Law of Patrimonial Responsibility of the State, 21st of the Expropriation Law, and to add Article 11 Bis of the Federal Law of Administrative Procedure in order to establish limits to the amounts of indemnities, when their payment is ordered in jurisdictional or arbitration proceedings, both domestic and foreign.

The initiative is currently under review by the Chamber of Deputies, and then must be sent to the Chamber of Senators for review.

If you would like further information on this matter, please do not hesitate to contact any of our partners or associates.

Yours sincerely,

Cannizzo