Why did the BCRA Suspend Four Exporters from the Foreign Exchange Market?

The Argentine Central Bank (the “BCRA,” after its acronym in Spanish) suspended four companies from accessing the Argentine foreign exchange market and carrying out new exports for failure to comply with the duty to transfer and settle the exports’ equivalent value in the foreign exchange market. The measure was handed down through Communiques “C” No. 90740, 90743, 90744 y 90745, all dated September 3, 2021.

Thus, the BCRA applied one of the preliminary measures provided in section 17 subsection a) of Law No. 19,359 regulating the Criminal Exchange Regime (as restated by Decree No. 480/95).

Foreign exchange regulations establish that Argentine residents are required to transfer to Argentina and sell in the FX Market for Pesos the equivalent value (‘contravalor’) of their exports of goods formalized (‘oficializadas’) as from September 2, 2019, within a maximum term ranging from 15 to 365 calendar days depending on the goods exported and the relationship with the importer, counted as of the date of shipment (‘cumplido de embarque’) of the export destination granted by Argentine Customs.

Regardless of the applicable maximum term, upon collection of the export, pertinent proceeds must be sold in the FX Market for Pesos no later than five business days from the date of collection. The BCRA has delegated the responsibility to follow-up and supervise compliance with the repatriation obligation of exporters to financial institutions. To that end, it has implemented the so-called ‘Monitoring of foreign exchange negotiations for exports of goods’ (“SECOEXPO,” after its Spanish acronym).

Although in the past these kinds of breaches resulted in summary proceedings under the Criminal Exchange Regime, suspensions such as these have not been frequent.