Through Decree No. 609/2019 and Communication “A” 6770 issued by the Central Bank of the Argentine Republic (“CBAR”), Argentina has established a new exchange control regime (the "New Regime"). This New Regime arises due to the recent economic and financial events and the uncertainty generated in the market. The New Regime will be effective as from the date hereof and until December 31, 2019.
The main highlights applicable to legal persons that are residents are the following:
- Obligation to repatriate and settle any proceeds from exports of goods with official boarding permits issued as from the date hereof. The maximum repatriation term varies depending on the type of export and on whether such exports are made to related companies. In addition to the maximum term established, the New Regime also provides for the obligation to repatriate and settle the proceeds within a term of five (5) business days counted as from the date of collection of said export;
- Obligation to repatriate and settle any proceeds from the exports of goods with official boarding permits prior to September 2, 2019 within a term of five (5) business days counted as from the date of collection of said export;
- Proceeds from exports could be applied to the cancellation of certain debts and pre-financing loans under certain conditions;
- Obligation to repatriate and settle any proceeds from exports of services within a term of five (5) business days counted as from the date of collection of said service export;
- Obligation to repatriate and settle any new indebtedness. In addition, for the payment of said new indebtedness, it will be necessary to evidence the prior repatriation and settlement of the same;
- The prior authorization of the CBAR is required (a) for the acquisition of foreign currency for saving purposes; (b) to transfer dividends and profits abroad; (c) for the payment of imports of goods to related companies when the amounts exceed 2 million dollars per month; (d) for the payment of imports of services to related companies; (e) to pre-cancel import debts of goods and services; and (f) to pre-cancel capital and interest on financial debts; and
- The access to the foreign exchange market for the payment of debts and other obligations in foreign currency between residents is prohibited, except for debts incurred prior to August 30, 2019, which were implemented through public records or public deeds.
As regards individuals, the CBAR's prior authorization is required for the acquisition of foreign currency for savings purposes only when it exceeds the equivalent to 10,000 dollars per month. In addition, for legal entities and individuals that are not residents, the prior authorization of the CBAR is necessary for the purchase of foreign currency above 1,000 dollars per month.
Finally, all transactions are subject to the Criminal Exchange Control Regime.