Argentina’s US$16.1-billion YPF judgement is now open to collection

Investors seeking to collect a US$16.1-billion court judgement from Argentina over its 2012 takeover of oil company YPF SA can start going after its assets, after a US judge ruled against the nation’s bid to push back those collection efforts.

The ruling is a blow to President Javier Milei’s government as it appeals US District Judge Loretta Preska’s September judgement — the biggest ever ordered by the federal court in Manhattan. Argentina, beset by economic distress including surging inflation, says the ruling equals almost one-fifth of its 2023 budget and that paying it would cause severe hardship.

The ruling came after Argentina missed a January 10 deadline to pledge assets, a condition that would have allowed it to appeal the judgement without having to post a bond securing the full amount.

Preska ruled in November that Buenos Aires could delay payment, pending its appeal, without the bond. But the judge put a condition on that delay: by January 10 the country had to pledge an equity interest in YPF, and proceeds from a hydroelectric dam project, as security for the investors, including former shareholders of YPF led by the litigation funder Burford Capital.

Burford stands to reap US$6.2 billion of the judgement. It didn’t immediately return an email seeking comment on the ruling

. A spokeswoman for Argentina’s Economy Ministry didn’t return a phone message.

In her ruling on Thursday, Preska agreed with Burford’s position that a reasonable amount of time has passed since the judgement, rejecting Argentina’s argument that the investors shouldn’t be allowed to start going after the assets yet.