Foreign Exchange Controls News

1. Access to the Argentine foreign exchange market to make payments of principal and interest of debt securities issued in Argentina

Under Communication “A” 4927 (issued on March 27, 2009), the Central Bank granted to Argentine issuers access to the Argentine foreign exchange market to buy foreign currency to make payments of principal and interest of debt securities issued in Argentina that meet certain requirements, including that the securities

(i) are authorized and publicly offered and listed in a self-regulated market,

(ii) issued in foreign currency in order to finance infrastructure works in Argentina,

(iii) have an average life of at least four years, and

(iv) are paid with foreign currency deposited in bank accounts of the placement agent located outside Argentina (as long as such foreign currency are transferred from accounts at foreign banks that are subject to regulations aimed at curtailing money laundering and terrorism financing based on international recommendations) or debited from foreign currency accounts at Argentine banks.

In addition, the placement agent must inform in writing to the Central Bank certain data about the investors and the foreign exchange trades, and confirm that it has obtained a sworn statement from each investor that the foreign currency used to pay for the securities was not obtained through access to the Argentine foreign exchange market within 15 days before the settlement date.

2. Extension of the term to prove the final capitalization of capital contributions before the Public Registry of Commerce (“PRC”)

Under Communication “A” 4933 (issued on April 17, 2009), the Central Bank allowed financial entities to grant an additional term of 180 days to prove the final capitalization before the RPC of capital contributions in Argentine companies of direct investors that are not Argentine residents when the delay is not the fault of the company (a fact that must be ascertained by the financial entity through its review of the documentation delivered by the company for that purpose). This Communication amends section 5 of Communication “A” 4762, which establishes the requirements that must be satisfied for transfers of foreign currency funds to Argentina to make capital contributions to be exempted from the 30% mandatory deposit (commonly known as the “encaje”) required by Decree No 616/2005.