29 Oct 19 The Argentine Central Bank introduces new exchange market’s restrictions
By Agustin Cerolini, Martin Chindamo and Julieta Mel.
According with the framework of the current Argentine economic situation, on October 28, 2019 the Argentine Central Bank (BCRA) issued Communication “A” 6815, through which it sets out a series of new measures aimed at increasing restrictions for access to the Argentine exchange market.
(i) Resident natural persons
The Communication establishes the need for prior BCRA authorization for access to the Argentine exchange market by resident natural persons for the constitution of foreign assets, family assistance and for derivative transactions when it exceeds the monthly amount of US$ 200 (instead of the previous limit of US$ 10,000).
Likewise, the Communication stipulates that the use of cash in local currency will only be accepted in operations of up to the equivalent of the monthly amount of US$ 100 and in the set of entities authorized to operate in the Argentine exchange market.
With the exception of certain cases expressly mentioned in the Communication, there is a need for prior BCRA authorization for access to the Argentine exchange market by non-residents for the purchase of foreign currency for amounts greater than the equivalent of the monthly amount of US$ 100 (instead of the previous limit of US$ 1,000).
(iii) Cash extractions with debit cards abroad
Besides, the Communication provides that cash extractions abroad with local debit cards may only be made with debit in the client’s local accounts in foreign currency.
(iv) Inclusion of exchange agencies under the operating regime between financial entities and/or local exchange houses.
In another order of things, the BCRA provided that the exchange agencies are reached by the operational guidelines detailed in the BCRA Foreign and Exchange rules for exchange operations between financial entities and/or local exchange houses.
(v) New regulations for imports of goods.
Similarly, the Communication establishes for local importers (i) a period of 90 calendar days, to comply with the demonstration of the customs entry of goods in the case of advance payments of imports to non-related suppliers, and (ii) the need for prior BCRA authorization for advance payments of imports to related suppliers of the importer.
(vi) Reporting regime.
In same line with the provisions above, the Communication provides that:
(i) the entities authorized to operate in the Argentine exchange market shall send to the BCRA (at the end of each day and in advance of 2 business days), information on exchange sales to be made at the request of customers or own operations that imply an access to the Argentine exchange market for a daily amount that is equal to or greater than the equivalent of US$ 2 million, for each of the 3 business days counted from the first day reported.
(ii) the clients of the entities authorized to operate in the Argentine exchange market shall inform them -with the necessary advance- so that they can comply with the requirement established in the previous paragraph, so that the aforementioned entities can proceed with the exchange operation, provided that the remaining requirements in the regulations are met simultaneously.