Argentine Central Bank’s New Regulations Concerning Import of Goods, Exports Under Collection Efforts and Repatriation of Direct Investments

1. Advance payments of imports
 
Communication “A” 5647 included debts originated in an import transaction in which the creditor is an official export credit agency among the import financings which are considered commercial debts.
 
One of the most significant changes is the amendment of the timing to prove the customs entrance registration of the goods in the event of advance payments of imports. The new regulation differentiates between two types of goods: capital goods and other goods. The applicable term to prove the customs entrance registration of the capital goods is maintained within 365 consecutive days as from the date of access to the local foreign exchange market (the “FX Market”). For other goods, the term was reduced to a 120-consecutive day term as from the date of access to the FX Market. It is worth noting that capital goods are those which, in accordance to its tariff code, are classified as “BK” in the MERCOSUR’s common nomenclature (Decree No. 690/2002, as amended).
 
Within the term corresponding to the type of good, the importer must prove the nationalization of the goods, or otherwise transfer and settle through the FX Market the foreign currency of the advance payment of the import of goods.
 
Finally, this regulation eliminates the ability capacity of financial institutions to grant an extension on the terms to prove the nationalization of the goods, if the delay was due not to the importer. This capacity is now reassumed by the Central Bank.
 
2. Follow-up of export transactions
 
In connection with the follow-up of the timely transfer through the FX Market of the foreign currency proceeds resulting from the exports of goods, Communication “A” 5648 includes a new category of “delinquent debtors” (Deudores Morosos) in the event of a delay in the repatriation of foreign currency proceeds from exports due to a fault of the importer. Consequently, with no prior approval from the Central Bank, the financial institution in charge of the follow-up of the export transaction must report the transactions under the description “collection efforts” of the exporter (gestión de cobro) if the importer is a public sector entity and the exporter proves the initiation of collection efforts under the law governing the transaction.

3. Repatriation of direct investment of non-Argentine residents
 
Through Communication “A” 5649, the Central Bank included new limitations for the repatriation of direct investments in non-financial private companies and/or in real estate by non-Argentine residents. The Central Bank’s prior authorization is not required: (i) in the event of investments prior to October 28, 2011, if the foreign investor proves the transfer of the funds of its investments and settlement through the FX Market; and (ii) if the foreign beneficiary is an individual or legal entity incorporated or domiciled in jurisdictions considered to be cooperative for the purposes of tax transparency.  
 
In addition, this regulation includes a new requirement for the repatriation of direct investments by non-Argentine residents. The intervening financial institution shall require a certification issued by local financial institution proving the date and the amount of the investment transferred through the FX Market and settled within a 365 consecutive day term, as of the date of access to the FX Market.
 
Finally, in the event of the transfer of an investment among non-Argentine residents, the requirement of the transfer and settlement of the funds through the FX Market shall be deemed to have been fulfilled as long as compliance is proven by the prior holder.