Repatriation of Investments and Funds: Insurers Are Exempted From the Mandatory Reserve Requirement

Through Communication “A” 5254 (the “Communication”), the Argentine Central Bank exempted from the mandatory reserve requirement insurers that repatriate their investments and funds located abroad, in accordance with Resolution No. 36,162 (the “Resolution”) issued by the Argentine Superintendence of Insurance.

The Resolution, published in the Official Gazette on October 27, 2011, compels the insurers to repatriate all the “investments located abroad” and the “investments and funds located outside of the Argentine Republic” in 50 consecutive days from the Resolution’s enforcement.

The Communication states that the foreign exchange incomes entered to Argentina through the Argentine Single and Free Foreign Exchange Market (Mercado Único y Libre de Cambios), in accordance with the Resolution, are exempted from the mandatory reserve requirement.

The mandatory reserve requirement for insurers arises from point 1.b of the Communication “A” 4377, June 29, 2005 and Communication “A” 4359, June 10, 2009. This Communication states that, except for insurers, among the assumptions for the mandatory reserve requirement, the sales of foreign exchange assets from the residents of the private sector that exceed the amount of US$ 2,000,000 per calendar month are still included.