Foreign exchange regulations - Transactions with securities
FOREIGN EXCHANGE
REGULATIONS – TRANSACTIONS WITH SECURITIES
On July 10, 2021, the Argentine Central Bank (the “BCRA”) issued Communiqué
“A” 7327 (“Communiqué 7327”) that further restricted the
access to the foreign exchange market (the “FX Market”) in connection
with the so-called “blue chip swap transactions”. In addition, on July
8, 2021, the Argentine Securities Commission (Comisión Nacional de Valores
or “CNV”) issued General Resolution No. 895/2021 (the “Resolution 895”),
which reduced the so-called “parking” period (i.e., the minimum term
during which securities must be held before their sale for foreign currency or
transfer abroad), and established limits to the sale and purchase of sovereign
bonds subject to foreign law.
1. General Requirements for Outflows through the FX Market
1.1. Exchange of Securities for Other Foreign Assets
Communiqué 7327 maintained the current requirement, whereby a person
accessing the FX Market must (1) not have sold securities in Argentina for
foreign currency or transferred securities to foreign depositary entities on
the date thereof nor in the previous 90 days; and (2) commit not to perform
such sales or transfers during 90 days thereafter.
Additionally, Communiqué 7327 established that such requirement will
also be applicable to exchanges of securities for other foreign assets
performed as from July 12, 2021 –thus including over-the-counter transactions.
1.2. Incorporation of New Requirements for Legal Entities
Communiqué 7327 established that legal entities accessing the FX Market
as from July 12, 2021, in addition to the requirements discussed in Section 1.1
above, must not have transferred in Argentina pesos or other liquid assets to
any natural or legal person controlling the entity on the date of access to the
FX Market nor in the previous 90 days, except for the payment of goods and/or
services in the ordinary course. Alternatively, if those transfers were made,
the person controlling the entity must not have sold securities in Argentina
for foreign currency or transferred securities to foreign depositary entities
during such 90-day term.
According to the BCRA’s regulations, there is “control” when a person, directly
or indirectly, (i) owns or controls 25% or more of the voting rights in other
legal person; (ii) has participated with 50% or more of the voting rights in
the shareholders’ meetings where the directors of the other legal person have
been appointed; (iii) holds an interest in the other legal entity, so as to
have the necessary voting rights to form the corporate will at shareholders’
meetings or to adopt decisions in the board of directors’ meetings; or (iv)
exercises a controlling influence over the management and/or policies of the
other legal entity.
2. Reduction of the Parking Period and New Limit to Transactions with
Sovereign Bonds
Resolution 895 reduced from three to two business days the minimum holding
period –parking– for: (i) the sales of securities (previously acquired
in pesos or foreign currency in Argentina) in a foreign market with settlement
in foreign currency (so called dollar “cable”) -whereas the one-business-day
period for sales in Argentina (so called dollar “MEP”) remains in force-; (ii)
the transfer of securities (acquired with pesos) to foreign depository
entities, except for CEDEARs or the primary placement of securities issued by
the Argentine Treasury; and (iii) the sale of securities deposited in the local
depositary agent, originating from foreign depository entities, in a foreign
market with settlement in foreign currency.
In addition, Resolution 895 reduced from 100,000 NV to 50,000 NV the weekly
limit applicable to transactions involving Governmental U.S. Dollar
denominated, fixed income securities bonds under Argentina law, and established
a 50,000 NV weekly limit for Governmental U.S. Dollar denominated, fixed income
securities bonds under foreign law.
Should you require further information, please do not hesitate to contact Fermín
Caride and/or María Victoria Funes and/or Lucía Carro.