NEW YORK: A US appeals court yesterday rejected Argentina’s bid to reverse a decision requiring the country and various banks to provide holdout creditors with information about the country’s assets, including military equipment and diplomatic property.
The 2nd US Circuit Court of Appeals in New York affirmed the 2013 ruling, which ordered the banks and Argentina to comply with subpoenas and information requests served by bondholders suing for full payment of debts after Argentina’s $100bn default in 2002. The holdouts are creditors that declined to accept the terms of 2005 and 2010 Argentina debt restructurings, in which it swapped about 92 percent of its bonds for new obligations.
While the court upheld US District Judge Thomas Griesa’s ruling, the three-judge panel stressed “that Argentina — like all foreign sovereigns — is entitled to a degree of grace and comity.”
Saying those concerns were of “particular weight” when it came to a country’s diplomatic and sovereign affairs, the 2nd Circuit urged Griesa to prioritise the production of documents “unlikely to prove invasive of sovereign dignity”.
Neither a US lawyer for Argentina nor a representative for a lead hold bondholder, Elliott Management’s NML Capital Ltd, responded to requests for comment.
Argentina defaulted in July of this year after refusing to honor orders barring it from paying holders of its restructured bonds without also paying $1.33bn plus interest to holdout creditors including NML.
Argentina’s latest default came after it refused to obey Griesa’s order on paying the holdouts. Griesa held Argentina in contempt in September. Reuters
