Frequently Asked Questions:
1. GENERAL QUESTIONS
1.a | Property Taxes and other fees:
The property taxes in Argentina are low. A typical amount a Gavilan Wine Estate owner would have to pay is about US$100 per annum.
Roughly an equal amount is charged for Irrigation Water. This is the water that is provided by the government through their canal system and is used to irrigate your vineyard/olive plantation.
1.b | Bank Accounts in Argentina and do I need one?
In line with the ever increasing international banking requirements Argentina demands a slew of paperwork from anybody who wants to open a bank account here. There is no benefit in having an Argentine bank account unless you intend to live here for long periods of time and there is certainly no need to rush to open an account. In fact, the reality is that if you can avoid it then you would be better off doing so.
There is no requirement for you to open a bank account in Argentina in order for you to become a Gavilan Wine Estate Owner. If you participate in our maintenance program you can make your quarterly payments by wire transfer in US Dollars into our US account or in Euros to our account in the EU.
If you do want to go ahead and open an account you will need to obtain a CUIL number which is a foreign national tax number. This will be done for you by the notary and is needed for the purchase of the property for you to be able to take proper title. You will also need your passport and a lot of patience.
2. Vineyard and Wine
2.a | Who takes care of my vineyard/orchard while I am away?
Gavilan Wine Estates employs a dedicated and expert team who are on hand all year round to maintain every aspect of the owner’s vineyards and orchards during their absence. The team is there to ensure that your ‘farm’ (finca) is well taken care of and properly watered. You will be in regular contact with an English speaking supervisor who will provide updates and let you know the status of your crop.
You also have the option to hire outside help to maintain your vineyard. Taking part in the Gavilan Maintenance program is optional.
2.b | How do I sell grapes or make wine?
When your vineyard comes to maturity and starts producing grapes you will see that on the maintenance costs you have an increase in your monthly maintenance fee. This is due to the additional work that is required by a productive vineyard as well as added management costs.
We help you to organize the harvest and throughout the growing season to make decisions on selecting a buyer for your grapes or which winery to use to make your wine. We also arrange for barrels to be purchased and delivered to your winery and oversee the drop-off of your harvest.
The first time you encounter this process it seems overwhelming but it is really not so bad. Many of the decisions that you make through the year will influence how you handle the harvest. Our experts will guide you along the way.
2.c | How do I ensure that my grapes all make it to the winery to be sold or made into wine?
In Argentina vineyards and wineries (in general the entire wine industry) is regulated by a government agency called INV (Instituto Nacional de Vitivinicultura).
Your vineyard will receive an official and unique vineyard number. The vineyard’s size and varietal planted is recorded with INV, as such INV has a general idea how many grapes your vineyard can produce. When your grapes arrive at the winery the winery is required to log the source of these grapes (your INV vineyard number) and the total amount of kilos that you delivered.
– IF YOU SELL YOUR GRAPES TO THE WINERY: Based on those kilos the winery will pay you the agreed price per kilo for your grapes.
– IF YOU MAKE YOUR OWN WINE: Two months after the winery received the grapes they are required to file papers with INV to show how many liters of wine were made from your grapes. When the wine is at the bottling stage the winery will file papers as to how many bottles of wine you have in storage.
With INV you will have to file export papers for your wine showing how many bottles were sent outside of the country and if you are selling within Argentina you have to file how many bottles were sold on the domestic market.
This ensures that neither vineyards nor wineries can cheat and/or add lesser wine to quality wine and sell more quality wine than they took in grapes. It protects the name of Argentine wine as well as consumers.
3. Olives and Processing
3.a | When will olives come to maturity and start producing?
The olive tree is a slow growing plant. The advantage is that an olive tree, once matured, is almost indestructible. They will survive on very little water and still produce a crop. They do not require much maintenance and as such are a lot less costly to maintain than a vineyard.
Typically an olive tree needs 7 years to grow and start producing. The older the trees the better the crop will be. Olives grow on the outside canopy of the tree. For maximum production trees should be trimmed on the inside branches to allow air to flow while the outside canopy is left to grow.
3.b | Should I plant olive trees for olive oil or eating olives?
The different varieties of olives produce different percentages of oil in the fruit. Of course you also have different sizes of fruits, ranging from small Albequina olives to the larger Manzanilla.
The advantage of olives is that you do not have to plant one or the other. Unless you know from the start that you would want oil production, you would plant the highest concentration of oil Alberquina trees. If you are unsure which direction to go you would plant something along the Manzanilla line, which has slightly less oil in the fruit but is also excellent to cure as eating olives.
Our Agronomist will sit with you and discuss the options and give you advice as to what are the best plants for your future plans.
3.c | Who will process my olives or purchase them?
There are several olive factories in San Rafael and we can contract with them each year to process your olives. Larger producers tend to negotiate better deals to process your fruits.
The other option is to simply sell them your olives. This is the fast cash route but you will leave some nice profits on the table.
Through contacts in the US we have buyers for olive oil who will buy the oil straight here in Mendoza by the metric tons.
4. Construction and Permits
4.a | Cost of Construction and available types of construction used:
Construction prices vary based on the type of construction required. Typical construction in San Rafael is with clay bricks. Just outside of the city you will find large clay brick ovens making these bricks. Since they are a local resource and do not require to be shipped from a distance they are inexpensive and therefore the most commonly used building material.
Other options are wood construction, which is typically used only on low budget homes or temporary structures, or steel construction with drywall finishes. This has become an increasingly popular form of construction in the past few years.
Construction prices vary from how elaborate the finished product is. A nicely finished home to north American or European standards will cost about US$660 p/square meter (US$60 p/square foot). Of course there is no limit as to how much you can spend.
4.b | Construction and Permits:
The City of San Rafael requires that all buildings are checked by a planning specialist and structural engineer. The idea is to ensure that the house complies with earthquake codes.
Although San Rafael sits in a sand filled plate and is a lot less susceptible to earthquake damage the requirements of the Province of Mendoza are the same for all construction planned within the province.
4.c | Architect
Many people are asking us if the architect that designed the Gavilan Lodge and Villas could design the same style of villas for them.
The general answer is yes. However, Orlando A. Migliassi is located in Santiago de Chile and, as such, hiring him would be more costly than hiring a local architect. We have a few local architects that we recommend (and others that we recommend to avoid). In Argentina the architect will also be the builder/supervisor for your construction from start to finish.
4.d | Building styles and Community requirements:
Gavilan Wine Estates requires that the design of your house is approved by the architect/planning board of the association.
There is no required building style. We do require however, that your house has some general appeal and architectural value. The planning board will work with you on getting your desired plans approved and make recommendations.
We are here to help you in the process as well as to ensure that the integrity of the community is being preserved for all owners.
4.e | Water and Sewer Systems:
Potable water is now available from a Co-Op along the main road fronting Gavilan Wine Estates.
The monthly fee to be connected to their water supply is the equivalent of US$12.00 and gives you 10,000L of potable water. Additional water used over that amount is billed individually according to usage.
Waste water is disposed of, as is typical in rural areas, by means of a septic system. A drainage field is built when you construct the house. The cost for the septic installation is very inexpensive and usually done by a brick mason.
5. Property Purchase
5.a | Can foreign nationals own real estate in Argentina and do they have the same rights as Argentine nationals?
To put it simple, yes! In Argentina foreigners enjoy the same rights as Argentine property owners. There are no restrictions in owning property or transferring property.
5.b | How are my rights as property owner ensured?
Just as in most other nations, real estate is transferred by a notary who will inscribe the transfer into the Hall of Records of the local government.
5.c | How does a transfer work?
Typically real estate in Argentina is traded in US Dollars. It is also common that purchase prices are not paid within the country but are transferred outside of the country.
Notaries prepare the transfer documents based on both parties expressing their desire to exchange property. Once the buying party proves that he/she has transferred the purchase price to the buyer (wire confirmation) the property is legally transferred by the notary and the signatures become a mere legal formality.
5.d | Which Notary office does Gavilan Vineyards use in San Rafael?
Gavilan Vineyards works exclusively with the Notary Pablo Bressan in San Rafael. The Bressan family is a second generation family of Notaries in San Rafael and enjoy an excellent reputation.
The added advantage is that Pablo Bressan speaks excellent English and can translate the legal documents that have to be prepared in Spanish.
The notary in Argentina is a non-biased party in a transaction. He is obligated to fulfill both parts of the transaction
5.e | Can I receive the transfer documents in English?
All legal documents have to be signed and filed with the government in Spanish. The notary office does have translations of the transfer documents and the power of attorney that will give you a loose translation of a typical transfer.
You always have the option to obtain a translation through an independent translator. The options here are to work with a certified translator in San Rafael or to work with an outside translator. We can put you in contact with either. Typically the outside translators are less expensive that the ones here in town.
5.f | What if I cannot be there for the transfer of the property?
For those that cannot be in the country for the transfer of the property the notary can prepare a power of attorney (poder) that will assign a third party to sign documents on behalf of the buyer. The power of attorney can be emailed to the buyer and signed in presence of a notary in their home country. The notary seal from the foreign country then needs to receive an apostil from the governing body that oversees the notaries in that country. This is a very common process for foreign transactions. Your notary will be able to advise on how to receive such apostil.
5.g | Can I take title of the Wine Estate in a company that is not located in Argentina?
Yes, foreign corporations can also own land in Argentina. The process is a little more time consuming and requires that all of the shareholders/owners of the company are disclosed. All company documents have to be translated into Spanish by a certified translator.
5.h | Can I open an Argentina company to hold title to the Wine Estate?
Foreign Nationals cannot directly own Argentine companies. It is a requirement that an Argentine National or permanent resident becomes the ‘founder’ of the company and stays in advisory position. This is a mere technicality.
Creating a “S.A” (Sociedad Anónima), similar to a US Corporation or a German GmbH, requires about 3-6 months. The costs are roughly US$2,500 for the founding of the company.
During that time, the purchase of the property can be carried out in the personal name of the owner, then, the owner gifts the property to his corporation and avoids additional transfer fees.
A second and very typical way to take title is by creating a personal company. This means the legal status of the land is not held by a single individual but by a company that is an individual.
By doing this there are legal protections and advantages that will be very helpful when the vineyard starts to produce and grapes are sold or turned into wine. During the initial years this is unnecessary and negates the need to hire an accountant for monthly reports to the tax authority (AFIP).
5.i | Closing Costs or Transfer costs:
There is a closing cost also called transfer cost associated with the purchase of real estate in Argentina. Here they are referred to as “Stamp Tax”. One is payable to the Federal Government the other to the Province of Mendoza.
The closing costs should be less than US$3,000. If they are higher than that we will cover everything above this amount.