Circular Foreign Exchange Operations and Movement of Funds and Securities with the Abroad - CAMEX 1 - 45

BANCO CENTRAL DE LA REPUBLICA ARGENTINA
COMMUNICATION "A" 272 11/01/83
TO FINANCIAL ENTITIES AUTHORIZED TO OPERATE IN EXCHANGE AND EXCHANGE BROKERS:
Ref.: Circular FOREIGN EXCHANGE OPERATIONS AND MOVEMENTS OF FUNDS AND SECURITIES WITH THE ABROAD - CAMEX - 1 - 45.

We address ourselves to you and through you to the interested sectors, to inform you that, due to what is established by Decree No. 1603 of the National Executive Power of 12/21/82, the text of which is added as an annex, the following provisions have been adopted, complementary to those made known by Communication "A" 251 of 11/17/82, in relation to its Chapter 1, point 1.2., section c).

1. Procedure for operations
   1.1. In cases where lenders and borrowers decide to maintain their direct relationship, they may agree to the renewal of the obligation under the conditions they freely agree upon, provided that the maturity deadlines indicated in Chapter 1, point 1.1., sections a) and b) of the aforementioned circular are respected.
   To perfect this agreement and so that the debtor can provide security for the fulfillment of the extended obligation, at the request of the local borrower, the Central Bank of the Republic Argentina will issue, in the name of the creditor, the National Government Nominal Bonds or the obligations ("Promissory Notes") referred to in Decrees Nos. 1334 and 1336, respectively. To this effect, when the local debtor settles its foreign exchange insurance through the intervening authorized financial entity - for which it must pay the corresponding amount in pesos - it will request that the issuance of the bonds or obligations be made in the name of the creditor, with the foreign exchange insurance being extinguished on that occasion. When presenting form 3891, form 3189 or 3191 must be attached for its cancellation, since the debtor loses all rights to acquire foreign currency in the single exchange market, to make payments for capital inherent to the canceled insurance. The delivery of the titles will be carried out at the Treasury Department of this Bank to the person designated by the creditor. In the case of Bonds, fractions lower than USD 5,000 will be settled in foreign exchange, charged to foreign exchange insurance.

1.2. If the agreement to extend the obligation determines the payment of interest rates higher than those fixed for the obligations or bonds, the local debtor may acquire in the exchange market, adjusted to the general character provisions in force at the time of making remittances abroad, the amounts necessary to cover the interest difference, but in no case in advance of the payment dates of the services corresponding to the bonds or obligations.

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1.3. The provisions stated will only apply in the following cases:
a) When the creditor is an institution abroad and the debtor's payment obligation is directly with the external creditor and payable abroad, or b) When the creditor is a bank established in the country and the funds lent to the debtor come from credit lines agreed upon by institutions abroad to the local entity. In this case, the debtor will request the issuance of the titles in the name of the local financial entity and this in turn may give them in payment, assignment or guarantee to its creditors abroad, or c) When the creditor is a local financial entity and the funds lent had come from foreign currency deposits constituted locally. In this case, the creditor may agree with the Central Bank procedures to receive amortizations and interest payments abroad.

1.4. Proposals to this Bank must be presented on form 3892.

2. Characteristics of the titles.
   2.1. The holder of the Nominal Bond or the obligation has the right to receive directly from the paying agent the amortization installments and interest services, regardless of the capacity in which they were delivered to them.
   Each amortization will be considered a partial execution of the guarantee that these bonds and obligations instrument and will imply the partial cancellation, up to the amount received by the creditor, of the external private debt thus guaranteed.

2.2. The creditor in whose name the bonds and obligations are issued as guarantee is authorized to substitute the original debtor and to maintain the guarantee instrumented in said bonds and obligations that covers the new commitment.

2.3. If the creditor in whose name the bonds or obligations are issued as guarantee, assigns the thus guaranteed credit, the assignee will conserve the guarantee instrumented in said bonds and obligations. In such case, the assigning creditor must transmit to the assignee the document that instruments the assigned debt as a condition to also transmit the bond or obligation that guarantee said debt. Likewise and as a condition for such assignment to be considered opposable to the Central Bank of the Republic Argentina, the external assigning creditor must notify it in a reliable manner to the Central Bank of the Republic Argentina and to the local private debtor assigned.

B.C.R.A. COMMUNICATION "A" 272 11/01/83
In such case, the Central Bank of the Republic Argentina in its capacity as Financial Agent of the National Government, will give mandate to the paying agent so that this amends the bond or the obligation, substituting the name of the creditor.

We salute you very attentively.
BANCO CENTRAL DE LA REPUBLICA ARGENTINA
Jorge E. Magistrelli Horacio A. Alonso
Manager of Deputy General Manager
Foreign and Exchange

ANNEX

B.C.R.A. TEXT OF DECREE No. 1603 Annex to
Comm. "A"272
THE NATIONAL EXECUTIVE POWER
"Buenos Aires, December 21, 1982.
HAVING SEEN what is provided by Decrees Nos. 1334 of November 26, 1982, 1336 of November 26, 1982 and Communication "A"251 of November 17, 1982, from the Central Bank of the Republic Argentina, and CONSIDERING:
That Communication "A" 251 expressly foresees the direct agreement between local debtor and foreign creditor and that it was not the purpose of said norm to interfere in the loan contract between the parties.
That direct agreements would be substantially facilitated if the Central Bank of the Republic Argentina delivered as guarantee of the debtor's obligation the Nominal Bonds in United States dollars or the External Public Debt Titles described respectively in Decrees Nos. 1334 and 1336, both dated November 26, 1982, or otherwise guarantee the local debtor's obligation. That in certain cases the creditors of the obligations of the debtors described in article 2nd of Decrees Nos. 1334 and 1336 of November 26, 1982 are local financial entities, for which it is convenient to foresee that such creditors can also be recipients of the Bonds or Titles, either in payment or in guarantee. Therefore, THE PRESIDENT OF THE ARGENTINE NATION DECREES:
ARTICLE 1 - The nominal bonds in United States dollars and the public debt titles contemplated respectively in Decrees Nos. 1334 and 1336, both dated November 26, 1982, in addition to being destined to cancel the external obligations described in article 2nd of both decrees, may also be delivered by the Central Bank of the Republic Argentina to creditors as guarantee of the fulfillment of the obligations of the debtor refinanced by the parties of the loan contract.

ARTICLE 2 - The Central Bank of the Republic Argentina may agree and resolve the form in which the circumstance that the Bonds or Titles of the public debt Decrees Nos. 1334 and 1336 of November 26, 1982 respectively- are delivered in guarantee will appear. The Central Bank of the Republic Argentina may also, to the extent that it does not affect its own assets and acts as Financial Agent on behalf and order of the National State, provide other

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ARTICLE 3 - The Central Bank of the Republic Argentina is authorized to deliver to local financial entities creditors of the obligations described in articles 2 of Decrees Nos. 1335 and 1336 of November 26, 1982 the Bonds or Titles of the public debt contemplated in them. Such delivery will be made, as appropriate, in cancellation or in guarantee of the fulfillment of said obligations. In such cases the local financial entity cannot give, assign or endorse the bonds or titles in the country, being authorized instead to give them in payment, assignment or guarantee to its creditors abroad.

ARTICLE 4 - The amounts in pesos that the Central Bank of the Republic Argentina obtains from those debtors with the abroad who had contracted foreign exchange insurance with that Institution for the cancellation of these, will be destined to decrease the obligations of the NATIONAL GOVERNMENT with the Central Bank of the Republic Argentina.

ARTICLE 5 - Communicate, publish, give to the General Directorate of the Official Registry and archive.
DECREE NO. 1603.
BIGNONE.
Signed: Dr. Jorge Wehbe
Minister of Economy"

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