New Measures to Facilitate the Payment of Reinsurance Premiums

In the light of the recent foreign exchange regulations introduced since Decree No 609/2019, through Resolution 927/2019 (the “Resolution”) the Superintendence of Insurance (the “SSN”, after its acronym in Spanish) clarified who are the beneficiaries admitted by the SSN to receive reinsurance premium payments outside Argentina.

Communique “A” 6770 of the Argentine Central Bank (the “BCRA”, after its acronym in Spanish), issued as a result of the mentioned Decree, had provided that the BCRA's prior agreement was required to have access to the exchange market for the payment of services with foreign affiliated companies. However, shortly after, through Communique “A” 6780, the BCRA clarified that such prior agreement would not apply to the payment of reinsurance premiums abroad, to the extent that the transfers were made “… in the name of the Foreign Beneficiaries Admitted by the SSN ”.

Since there were certain doubts about the scope of these beneficiaries, on October 10, 2019 the SSN issued the Resolution with the purpose of identifying these entities. The Resolution:

• Established that admitted reinsurers and/or collection agents appointed by them to act on their behalf for the collection of payment of reinsurance premiums outside Argentina is deemed a Foreign Beneficiary Admitted by the SSN.
• Created a Registry of “Foreign Beneficiaries Admitted by the SSN Collection Agents- Communique “A” 6780 BCRA” (the Registry), where all collection agents appointed by admitted reinsurers to collect reinsurance premiums outside Argentina on reinsurers’ behalf shall be registered.

The Resolution also listed all the documents that must be submitted by admitted reinsurers to the SSN to register a collection agent and established a 15 day-term to report any modification of the status of the collection agents. The following must therefore be submitted to the SSN: (i) the power of attorney by which an admitted reinsurer appoints its collection agent, with sufficient powers to receive payments on the reinsurer’s behalf, indicating the full name and country of incorporation of the collection agent, (ii) a certificate issued by the authority of the country of incorporation of the agent with evidence of its registration and attesting that it may act as reinsurance broker, and (iii) information on the collection agent’s foreign bank account where payments shall be sent, with evidence that the agent is the actual account holder.

Admitted reinsurers that had provided evidence of the requirements mentioned in (i) to (iii) above prior to the issuance of the Resolution (under Resolution SSN 38,595, in force until September 7, 2016) may submit a sworn statement through its legal representative, where the representative ratifies that those requirements are still met and declares that he/she has sufficient powers to issue the sworn statement.