One of these situations must take place, concurrently with others (see question 3), in order to apply CFC rules over an entity that is considered a taxpayer in the foreign country where it is located: the non-resident entity does not have the material and human resources necessary to perform its activity or its passive income represents at least 50% of the entity’s income or its profits result on deductible expenses for related parties in Argentina. Therefore, if these conditions are not met, CFC rules are not applied over such entities.
The following entities are excluded from the application of section C): financial institutions, insurance companies, and common investment funds.