Argentina has urged a US judge to put a $16.1 billion judgment on hold while the country appeals the ruling. The judgment stems from the government’s 2012 seizure of a majority control in state-controlled oil company YPF.
In 2012, the government seized a 51% controlling stake in YPF from Spanish energy company Repsol. The government argued that the move was necessary to protect the country’s energy security. Repsol challenged the seizure in international arbitration, and in 2018, an arbitral tribunal ruled that government had expropriated the company’s assets and ordered it to pay $16.1 billion in compensation.
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Argentina has appealed the arbitral ruling, but the US District Court in Manhattan has upheld the judgment. Government is now asking the court to put the judgment on hold while the appeal is pending.
Argentina’s arguments
Argentina argues that enforcing the judgment would have a devastating impact on the country’s economy. The country is already struggling with high inflation and debt, and the $16.1 billion judgment would be equivalent to nearly 20% of its annual budget. Government also argues that enforcing the judgment would make it more difficult to attract foreign investment and could lead to a sovereign debt default.
Repsol’s arguments
Repsol argues that Argentina should not be allowed to delay enforcement of the judgment. The company has waited more than a decade for compensation, and it argues that Government is simply trying to stall. Repsol also argues that Government has a poor track record of upholding its international obligations, and that allowing it to delay enforcement of the judgment would send a message to other countries that they can simply ignore arbitral rulings.