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The Argentine Central Bank (ACB) issued Communication “A” 5850 (the “Communication”) introducing several amendments to the current exchange control regime. The amendments’ main purpose is to provide more flexibility to the current exchange control regime and to implement the governmental decision to let the exchange rate float -despite the ACB intervention in the foreign exchange market (i.e., dirty float). In this regard, the Communication provides for changes to the acquisition of foreign currency regime applicable to local residents, payments of imports, services and cross border finance. In addition, it is implied that the Executive Branch shall issue a new decree amending the current “encaje” restriction (i.e., 30% mandatory set aside applicable to foreign finance and non direct investment). Among others, the main changes applicable to those transactions to be performed as of December 17 include (i) the elimination of the Tax Authority’s prior authorization regime for the acquisition of foreign currency, (ii) the implementation of the foreign investment regime applicable to local residents –whether individuals or legal entities- allowing them to acquire up to USD 2,000,000 per calendar month, (iii) the elimination of the current regime for the payment of services, allowing the payment of services rendered as from today without limitation (even to affiliates and related entities), (iv) the abrogation of the obligation to settle in the local foreign exchange market any cross border finance (it will only be necessary in case the resident were to pay that debt from Argentina); (v) the authorization to cancel totally or partially cross border finance after the minimum 120-day stay term has elapsed; (vi) the reduction form 365 to 180 days of the term to evidence the entrance of imported goods paid in advance; (vii) the establishment of a repayment scheme for imported goods and services debts until full release on June 2016; and (viii) the elimination of the prefinancing export regime. For additional information, please contact Gabriel Gómez Giglio, Martín Quintanar or Francisco Fernández Rostello. |
