Further Restrictions for Blue Chip Swap Transactions

The Argentine Securities Commission (the “CNV” after its acronym in Spanish), by means of Resolution No. 856, and the Argentine Central Bank (the “BCRA” after its acronym in Spanish, through Communique “A” 7106, enacted new regulations applicable to blue chip swap transactions.

CNV General Resolution No. 856 amended the minimum holding periods required for certain securities transactions, eliminating such period for the supply of foreign currency in the market and maintaining it for its demand.

In this regard, Resolution No. 856 implemented the following amendments:

 

• Elimination of the minimum holding period of securities applicable to individuals, so that individuals who acquire securities with settlement in foreign currency are not required to comply with such minimum holding period, notwithstanding the settlement method used in the subsequent sale of such securities;

 

• Establishment of a minimum holding period of 15 business days to transfer securities settled in pesos to depositary entities abroad, to be counted as of the date of settlement of the securities in the corresponding depository entity (except in such cases in which the securities originate in the primary placement of securities issued by the Argentine Treasury);

 

• Establishment of a minimum holding period of 15 business days, applicable to both individuals and legal entities, prior to the settlement against pesos of securities received in local depositary entities from foreign depositary entities; and

 

• Lastly, transactions entered into (concertadas) in foreign markets as clients through the sub-accounts held by agents authorized by the CNV must be made, exclusively, in authorized markets regulated by a governmental entity, which do not belong to non-cooperating jurisdictions for the purposes of fiscal transparency pursuant to article 24 of the annex of Decree No. 862/2019, with which the CNV has a signed and valid Memorandum of Understanding.

 

The BCRA, by means of Communique “A” 7106, established new restrictions to blue chip swap transactions:

 

• Non-Argentine residents may not enter into (concertar) sales of securities settled in foreign currency in Argentina, with the exception of the sale of securities purchased in Argentina and settled in foreign currency as of September 16, 2020, which have been held in the non-Argentine residents’ portfolio for a term of no less than 1 year; and

 

• Securities transactions entered into (concertadas) abroad and securities purchased abroad may not be settled in pesos in Argentina.