Requirements to make portfolio investments abroad are modified

Through Communication ‘A’ 4,850, in force from October 17, 2008, the Argentine Central Bank eliminated the requirement that the accounts to which Argentine residents transfer foreign currency purchased in the foreign exchange market as portfolio investments have to be maintained in financial entities or investment banks located in OECD countries (Organization for Economic Co-operation and Development countries) with an international rating of at least ‘BBB’. The Communication also eliminated the possibility of transferring the funds to off-shore sub-accounts of the Argentine residents.

Under current rules, transfers have to be made to accounts of Argentine residents at foreign banks or foreign financial entities that regularly act in investment banking activities.

The Communication maintains other requirements including that the foreign account has to be registered in the name of the Argentine resident making the transfer; and that purchases of foreign currency over the equivalent of US$ 10,000 can be made either through current or savings accounts registered in the name of the person making the transaction, through an electronic transfer made to the intervening entity from the bank account of the person making the transaction, or by check.

Finally, the Communication returns the limit to the purchase of foreign currency to make portfolio investments by Pension Funds back to US$ 2,000,000 (said limit had been increased to US$ 20,000,000 through Communication ‘A’ 4,724).