The Argentine Central Bank clarified the scope of the regime with regard to the follow-up mechanism applied to the export permits.
Through Decree No. 1722/2011, published in the Official Gazette on October 26, 2011 (the "Decree"), the Argentine government eliminated the exemption that released hydrocarbon and mining companies from the obligation to repatriate all the foreign exchange proceeds from the export of goods and, consequently, equaled the treatment of these companies to the rest of the exporters (see "Repatriation of Foreign Currency Proceeds of Exports - Exemption to Hydrocarbon and Mining Companies Removed" published in Marval News # 110 dated October 31, 2011)
On December 30, 2011, the Argentine Central Bank ("ACB") clarified the scope of the Decree with regard to the follow-up mechanism applied to the export permits.
1. Exports officially made since or on October 26, 2011
The Decree revokes the provisions of:
- Communication "A" 3971 of the ACB, which considered that the obligation to repatriate foreign exchange proceeds from export permits (for consumption purposes), corresponding to the exports of goods of mining projects with foreign exchange stability, has been fulfilled as long as the export company proves that the exported goods belong to the mining project by which the company obtained the tax stability; and
- Communication "A" 3978 of the ACB, which stated that the obligation to repatriate foreign exchange proceeds from export permits of hydrocarbon companies was deemed to have been fulfilled when the foreign exchange proceeds of at least 30% of the FOB or CyF value of the permit were repatriated.
2. Exports officially made until October 25, 2011
The obligation to repatriate foreign exchange proceeds can be considered fulfilled if the exporter reliably proves that the shipment charge was collected before or on October 25, 2011.
2.1. Exports informed as fulfilled up to October 25, 2011: payments received as from October 26, 2011 must be transferred to and liquidated at the local foreign exchange market (Mercado Único y Libre de Cambios or MULC) even if the export permit was informed as complied with up to that date.
2.2. Exports pending fulfillment up to October 25, 2011: The obligation to repatriate foreign exchange proceeds from payments received until October 25, 2011 may be deemed to have been complied with if the date of the payment and the fact that the received funds entirely proceed from the export permit are reliably proved. The outstanding amount to be collected by the closing of October 25, 2011 shall be transferred to and liquidated at the MULC under the applicable terms.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
