If Argentina does not comply with the Court’s requirements, it will lose its right to appeal and will have to pay the sum of €1.3 billion to the holders of the PBI Bonds.
Through the Decree 277/2024 published this Monday in the Official Gazette, and which bears the signature of Javier Milei and some of his ministers, a series of measures related to the restructuring of the National State debt were established, specifically related to bonds denominated “ Marketable Securities Linked to GDP“.
Said Decree decreed approves the documents necessary for the Argentine Republic to comply with the order of the Court of Appeal of England and Wales if Palladian Partners LP and ors v The Republic of Argentina and anor (FL-2019-000010).
The case of debt restructuring of the Argentine National State is about the PBI Bonds, which were issued in 2004 to defer the payment of the debt. In that context, there was a trial in London in which it was determined that Argentina had to pay the holders (three funds) of these bonds a sum of €1.3 billion. The Argentine Republic appealed the decision, but to do so, it must meet a series of requirements, including:
- Deposit a sum of money in a trust
- Grant a letter of credit
The decree 277/2024 approves the documents necessary to meet these requirements.
Key points of the regulations
- Approval of document models:
- Trust “RofA Special Trust 2024” or “Special Trust of the Argentine Republic – 2024”
- Standby Letter of Credit
- Letter of Credit Facilities
- Schedule of fees and expenses for UMB Bank, National Association
- Scheme of fees and expenses for Banco Santander, SA
- Acceptance Letter
- Extension of jurisdiction and waiver of sovereign immunity:
- In favor of the New York courts
- Limited to extended jurisdiction
- Designation of the Banco de la Nación Argentina as Process Agent
As mentioned in the official text, this decree is important because it allows the Argentine Republic to continue with the appeal process of Judge Picken’s decision in the Palladian Partners case. If Argentina does not comply with the court’s requirements, it will lose its right to appeal and will have to pay the sum of €1.3 billion to holders of the PBI Bonds.
Source: Ambito
