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10 days after dismissing litigation that had enjoined the Milei Administration’s repeal of the Rural Land Law, the Argentine Supreme Court ordered an injunction in a different case, Árbol de Pie. On its face, this second case mirrors its recent predecessor. Read on to understand the Court’s apparent change of course and what it means to foreign investors interested in Argentine rural land.
Árbol de Pie and Malvinas Veterans: Same Issues, Different Results
The Supreme Court’s Ruling on the Malvinas Veterans Case
In our last article on Argentina’s Rural Land Law, we reported on the Supreme Court’s dismissal of a case brought by a Malvinas Veterans non-profit interest group. That case, a class action alleging an unconstitutional exercise of executive power by the Milei administration’s repeal of a law, prompted a nationwide federal court injunction to stay the repeal in February 2024. The injunction kept the law in effect, and foreign investors largely shelved rural land purchases pending the case’s outcome.
Last week, the Milei government and its supporters cheered the Supreme Court’s decision to dismiss the case. Although made on procedural grounds (the Malvinas Veterans’ lack of standing to bring a class action), the ruling appeared to clear the way for foreign purchases of rural land, at least until there was a review of the constitutional issue (whether the Rural Land Law could be repealed by executive order) or the Milei administration could push a law through Congress to bury or modify the Rural Land Law. Árbol de Pie has thrown a cold-water splash on that brief celebration.
Árbol de Pie and the New Injunction
In Árbol de Pie, a non-profit environmental interest group, together with indigenous communities, had brought a similar action to nullify the repeal of the Rural Land Law. The plaintiffs claimed the repeal undermined national sovereignty, threatened environmentally sensitive land, and disrupted Argentina’s guarantees for indigenous communities. As with the Malvinas Veterans case, the plaintiffs obtained an injunction (this time directly from the Supreme Court), pending a lower-court ruling on their standing to sue.
How the Court Reached a Different Outcome
The Supreme Court reviewed the case after the plaintiffs sought clarification on the impact of the Court’s ruling in the Malvinas Veterans’ case. While acknowledging the similarity of claims, the plaintiffs in Árbol de Pie emphasised that their class representation also included the defence of environmental rights and indigenous communities. Two justices of the court (Rosatti and Lorenzetti) joined ad hoc justices Pérez Curci and Barroetaveña in an opinion that agreed with the plaintiffs, remanding the case to the lower court for a finding on the standing issue.
Curiously, however, just days after lifting an injunction in Malvinas Veterans, the majority granted an injunction until the lower court ruled. Justice Rosenkrantz wrote a visceral dissent criticising the injunction, as, in his view, the Supreme Court lacked jurisdiction to grant interim equitable relief absent the plaintiffs’ showing of a concrete, imminent, or irreversible environmental risk.
What Does This Mean for Foreign Purchasers of Rural Land?
Simply put, the injunction granted in Árbol de Pie means the Rural Land Law remains in force.
As a result, the restrictions previously imposed on foreign ownership of rural land continue to apply. Nonetheless, the legal and political debate surrounding the Milei administration’s sweeping executive order (Decree No. 70/2023) remains far from settled. Local media reports that opposition lawmakers are pushing for a special session of Congress later this month to overturn some or all of that executive order.
In the meantime, the future of the Rural Land Law remains uncertain, and windows of opportunity are brief. Interested investors should be ready to move quickly if the constitutional challenges are overcome or if Congress endorses the repeal. Until the Supreme Court or the legislature provides greater certainty, rural land purchases must be carefully assessed amidst a volatile legal and political back-and-forth.
Source: Laurence Wiener
Attorney-at-Law•WSC
San Martín 140, 18th Floor, C1004AAD, Autonomous City of Buenos Aires, Argentina
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