On 28 June and 4 July 2024, the Central Bank of Argentina (“BCRA”) issued Communications “A” 8055 and 8059 introducing several amendments on different aspects:
On 28 June and 4 July 2024, the Central Bank of Argentina (“BCRA”) issued Communications “A” 8055 and 8059 introducing various amendments on different aspects:
External financial indebtedness
Communication “A” 8055 determined that the free foreign exchange market (“MLC”) may be accessed to pay in the country or abroad the principal and interest services of debt securities in foreign currency, provided that:
– The general requirements for access to the MLC are met.
– The securities have been fully subscribed abroad.
– The totality of the funds obtained from the issue have been settled through the MLC.
Transactions with BOPREAL
Pursuant to the provisions of Communication “A” 8055, in the case of a sale transaction with repurchase obligation using BOPREAL acquired in a primary subscription:
– The initial sale of the securities shall not be considered for the preparation of the affidavits related to the blocking periods applicable to portfolio dollarisation transactions.
– The sale shall not allow the customer to carry out securities transactions for the difference between the value obtained from the sale and the nominal value of the BOPREALs.
– Once the customer regains possession of the BOPREALs, these securities will receive the same treatment as BOPREALs acquired in a primary subscription, including exceptions to the lock-up period in case of sale with settlement in foreign currency or transfer to depository institutions abroad, provided that they are used to cancel commercial debt for imports of goods and/or services prior to 12 December 2023.
Interest payments on commercial and financial debt to related parties
Communication “A” 8059 eliminates the need for the BCRA’s prior approval to access the MLC to make interest payments on commercial debts for the importation of goods and services to related entities abroad, provided that the interest is due on or after 5 July 2024.
Likewise, the BCRA’s prior approval shall not be required to make interest payments on commercial debts maturing prior to 5 July 2024 and interest on financial indebtedness to related entities abroad, provided that:
– The general requirements for access to the MLC are met.
– The payment is made simultaneously with the settlement in an amount equal to or greater than the amount of interest, by means of:
– New financial indebtedness abroad, with an average life of no less than two years and including at least one year’s grace period for the payment of capital, counted from the date of access to the MLC.
– New direct investment contributions from non-residents.
New financial indebtedness with foreign countries and new foreign direct investment contributions may be entered and settled by the debtor of the foreign indebtedness, the interest on which will be paid by another resident company related to the debtor and its economic group. These may not be considered for other mechanisms contemplated in the foreign exchange regulations.
