The former Treasury prosecutor, Bernardo Saravia Frías, believed that, after the sentence issued Thursday by New York judge Loretta Prieska Argentina’s legal situation was seriously compromised.
“If we were one step away from the precipice, we are now directly to the limit. The sword of Damocles falls and the tone of the sentence confirms it,” warned Saravia Frías.
From his point of view, the chances that the state can pass this test are practically real empty and all that remains is to appeal to all the legal loopholes extend the result as much as possible.
But playing to extend deadlines is possible very serious side effects. He explains it this way: “The United States judicial system could dictate the doctrine pari passu, What was the element used by the late judge? Tommaso Griesa finish cornering Argentina according to the judgment given by the so-called bondholders resist”says Saravía Frías
This must be seen in the perspective that Argentina wants to return to having relations with Argentina international credit marketsor in other words, obtain the ability to place dollar debt with private creditors. This strategy could be frustrated by the pari passu clause, which essentially means this: “No creditor can be paid if the Burford fund is not among them,” says Saravia Frías. That is, if a debt maturity that is up to date needs to be paid, say $100, a portion of that $100 needs to go to the Burford fund.
The former Attorney General recommended to the government let’s stop insisting before the United States Justice that they inherited a disastrous economic and financial situation and that he is making every effort to move forward, and that in this context it is impossible for him to face a sentence of 16 billion dollars. “The State is above the governments in power and its responsibilities are the same, regardless of who governs,” underlines Saravia Frías.
— Are we on the verge of a new embargo, as in the case of the Libertad frigate, which was seized for a few days and spent several days in a port in Ghana, on the African continent?
— Public international law is based on the principle that prevents the seizure of a state’s assets. Over the years, Kirchnerism’s strategy has been to invoke that right to escape embargoes, until Judge Griesa reinterpreted a pari passu clause. In that rereading oblige creditors who had a court judgment in their favor to pay to any non-defaulting creditor. This prevented Argentina from meeting regular debt payments to some bondholders because holdouts were in the middle.
— The judge spoke about the State that put the YPF shares as collateral.
— Preska happens to be the heir not only to Griesa’s court, but also to his vision on these types of cases. When the judge asks for guarantees, she follows this line, puts the government under pressure warning him that he can no longer bet that he is elusive.
Saravia Frías recalls that Argentina has just renegotiated with the IMF and wants to do things well to be able to return to the capital markets. My opinion is that you won’t be able to do that if you have this process open.
— What can Argentina do now?
— The Government must continue to fight in the courts but without losing procedural status, it must continue to insist in the Chamber, but obviously it is not easy. The procedural paths have narrowed. My impression is that if Burford insists on asset enforcement requests it is because he must have an ace up his sleeve. But I insist: you should never stop defending yourself. But it must be done with professionalism and explaining from a legal point of view why the country should not pay that penalty.
–Can we insist that the Eskenazi group is suspected of being the beneficiary of the punishment?
— You have to insist on everything, but I don’t know what chances there are of that having an effect. What I believe is that an investigative commission should be created to reveal what really happened at YPF.
–Could it happen that the process falls again on the YPF? Today the burden of the sentence falls on the State but not on the oil company.
— The House may order it. Yes. It is a risk to the actions that hold the power of the national government. It should be remembered that of the 50.1% “state”, half comes from the provinces, and that part is not at risk.
Source: Clarin
