Argentina: New regulation in the local market for external securities transactions in foreign currency or transfer securities to and from ICSDs - Update
Note: This announcement, originally published on 14 October 2021, has been updated to remove "custodians" and "custodian banks" as the CNV has officially confirmed that the sworn declaration requested for securities transactions versus foreign currency through on-exchange markets (priority-price-time and also bilateral segment) or transfers to/from ICSDs will need to be requested by the local broker and not by the local sub-custodian. Changes have been highlighted.
Clearstream Banking1 would like to inform customers that the National Securities Commission (CNV) published Resolution 907/21. Effective
immediately
there are new requirements in the local marketfor securities transactions with settlement in foreign currency or the transfer of securities to and from ICSDs.
In addition, a weekly limit of nominal value of 50,000 has been established for transactions of securities denominated and payable in US Dollars (USD) issued by the Republic of Argentina under Argentinean law and settled in a currencydifferent than Argentine Peso (ARS).
The monitoring of the limit is made by the local brokers.
The sworn declaration will need to be requested by the local broker and not by the local sub-custodian.
Background
The regulation states that in order to book securities transactions against foreign currency or transfer securities to and from ICSDs, the investor will need to provide a sworn declaration before the order of trading is placed for transaction of securities versus foreign currency through the on-exchange markets (priority-price-time and also bilateral segment) to the local brokers stating that:
- Within 30 calendar days before the booking of such transactions, the investor has not booked any sale against foreign currency of Argentine bonds denominated in USD under local law in the price-priority-time segment (on-exchange); and
- The investor will not book any sale against foreign currency of Argentine bonds denominated in dollars under local law in the price priority-time-segment (on-exchange) for 30 subsequent calendar days since the settlement of such transactions or transfers.
Customers should be aware that local brokers may ask for a sworn declaration before being able to book transactions against foreign currency of Argentina bonds under local law or transfers to ICSDs.
Impact on customers
There is no impact to the current CBL operations.
External against payment transactions in ARS remain suspended until further clarification from regulators.
Alternatively, Clearstream Banking customers can settle external transactions on a free of payment basis.
Internal and Bridge transactions are open for settlement in ARS.
Further information
For further information, customers may contact Clearstream Banking Client Services or their Relationship Officer.
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1. Clearstream Banking refers collectively to Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248, and Clearstream Banking AG (for Clearstream Banking AG customers using Creation Accounts), registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500.