The airline, Aerolineas Argentinas, will continue to demand National State funds in order to function, because the expropriation process, which began in 2008, has still not finished and therefore, is still a private company. According to the federal watchdog the Executive Branch had no control of the company until 2009.

The report approved this year aimed to evaluate the management of Aerolineas Argentinas (ARSA), Austral Lineas Aereas-Cielos del Sur SA, and its controlled companies (Jet Paq SA, Optar SA, and Aerohandling SA), owned by Interinvest SA, during the 2008-2009, should have been the transition stage from private company into state hands.

About the expropriation (see Chronology), the AGN indicated that a "term of abnormal occupation was not determined, as it was established that it would last longer than the period strictly necessary." In this regard, they added that "the Government takes the place of Interinvest SA until there is a final judgment of expropriation." Until then, "they have a limited right of use."

In addition, prior to the agreement that guaranteed the purchase of shares (July 2008), the State "had not carried out a legal and technical analysis that considers what might be the costs involved in rescuing companies, and the investments needed to restore the functioning of the company in the commercial aviation market".

In fact, the report notes that "the Federal Government begins to control the Board and the General Management of the companies on January 2009, and will have full control of the group by February of that same year." To be exact, during the transition period, the company Interinvest had overall control while the Executive Power only handled the general management of the company.

In a nutshell, although the company is under the management of the Government, from a budgetary point of view, Aerolineas Argentinas is still a private company. In fact, the budget items reflected its private company status, but from an investigation by El Auditor.info, it was confirmed that, in the last budget approved in 2010, the transfer of funds (in this case economic subsidies) to the commercial airline were $ 1.77 billion for concepts such as: "Transfers to Private Enterprises or Transfers to Finance Private Sector Current Expenditure”.

Transitional Council

According to the watchdog, the figure of the Transitional Council, composed of both parties and created by the Memorandum of Agreement "is not defined in the Commercial Companies Law." However, and simultaneously, "the Board remained in operation, with majority and presidency belonging to the Interinvest Group, with the powers conferred by the Companies Act, which resulted in the lack of viability for the fulfillment of the mandate of the Council and restricted the task of the General Manager (proposed by the State).

Chronology (According AGN)

- In July 2008, the memorandum of agreement between the Ministry of Transport and Interinvest SA was signed, through which the willingness of the Federal Government to buy the shares of Aerolineas Group was established.

- In September 2008 Law 26.412 was passed, it expressed the commitment of the Federal Government to rescue the companies. The report said that "the draft law raised by the Executive Branch established the approval of the minutes accorded, which was not reflected in the law." 

- Three months later, in December of that same year, another provision was sanctioned, Law 26,466, which resulted in the expropriation of the company shares. It established the conditions by which the State would get the total amount shares from Aerolineas Argentinas and Austral.