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ARGENTINA | 08-01-2024 17:06

YPF case: Argentina pleads with US judge over presenting of collateral

Argentina requests relief From Burford’s Capital's intent to seize assets over 2012 YPF nationalisation case.

Argentina has asked a Manhattan court to stop Burford Capital from immediately trying to seize its foreign assets as the hedge fund seeks to collect on billions of dollars that a judge ruled it is owed by the South American country.

President Javier Milei's government filed a pleading on Monday before Judge Loretta Preska from the US District Court of the Southern District of New York opposing Burford’s intention to start the process to seize assets as from January 10, calling the timing “unnecessary and premature.”

Argentina requested another date than January 10 to provide guarantees and post assets as collateral. In several other cases, the country’s lawyers wrote, “courts have found much longer periods to be ‘reasonable.’”

Preska, who is expected to rule on the timing of this issue Tuesday, has already granted multiple delays for the enforcing of the case ruling.

Burford had moved in its own filing for the day after January 10 to be determined as a “reasonable period of time” for it to begin trying to seize foreign assets. That’s the deadline by which Argentina has to pledge a guarantee to plaintiffs — one of two requirements it must meet in order for Preska to extend a stay of enforcement on her US$16.1-billion ruling pending the country’s appeal to a higher court.

On Tuesday afternoon, the New York magistrate must affirm her order establishing January 10 as the date, or else rule in favour of the Argentine pleading and postpone requests for seizure until “the plaintiffs have identified the assets to be attached."

Last month, Preska agreed to exempt the posting of a bond for the total amount of the trial, while awaiting a final decision for the ruling.

In January, Presidential Spokesman Manuel Adorni acknowledged that “Argentina is in a very complicated situation” in relation to the trial for the expropriation of YPF.

“Argentina is determined to observe all contracts and rulings of any kind,” said Adorni at his usual press conference at Government House.

He pointed out that “they’re amounts in excess of what one may call a minor setback; we understand the disaster that has been made and the disaster that the administration at the time made, perhaps with [economy minister in 2012] Axel Kiciloff’s cutting remarks, has translated into the great mess that is this ruling."

In court, Argentina has said it has no intention of pledging the guarantee — YPF shares and receivables from a hydroelectric plant — and it isn’t on track either to meet the second requirement of requesting an expedited appeals process.

Milei, who took office December 10, reiterated in December Argentina doesn’t have the money to pay and floated the idea of paying plaintiffs with a perpetual bond, a proposal met with swift scepticism by analysts. 

According to reports, Argentina’s situation with the YPF case was snuck into the agenda of meetings with IMF officials held over the weekend in Buenos Aires.

Judge Preska was in the headlines last week after she ruled to reveal the identities of the personalities who show up on the list of famous people who visited the island of Jeffrey Epstein, who was accused of sex-trafficking before dying in jail.

The case against Argentina was brought by companies that didn’t receive a tender offer when the nation’s biggest oil producer, YPF SA, was nationalised in 2012 — a violation of YPF’s statute at the time.

Burford is financing their case and is entitled to a big portion of the US$16.1-billion ruling.

 

– TIMES/PERFIL/BLOOMBERG

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