Amid the ongoing controversy over the potential handover of YPF shares as payment for a US$16-billion judgment related to the oil company's expropriation, the United States government has announced it will intervene in court to support Argentina.
US President Donald Trump’s administration is set to file an amicus curiae brief backing Argentina’s request to suspend the ruling that ordered the transfer of 51 percent of shares in the state-run energy firm YPF.
The US Department of Justice will submit the filing to the New York Court of Appeals, seeking to maintain the freeze on Judge Loretta Preska’s order throughout the appeal process, according to multiple reports in local outlets.
At present, a temporary suspension is in place pending the presentation of legal arguments by both sides. Washington’s intervention is aimed at ensuring that the halt remains in effect for the full duration of Argentina’s appeal.
The move by the Justice Department will bolster Argentina’s position as it challenges Preska’s June ruling, which ordered the immediate transfer of shares to litigation funds Burford Capital and Eton Park following the country's loss in a 2023 court case. That order is currently on hold due to Argentina’s appeal.
In 2024, under the Biden administration, the US had already filed an amicus brief rejecting the plaintiffs’ attempt to enforce the ruling via a handover of YPF shares.
At the time, the Justice Department argued such a move “violates the United States’ sovereign immunity standards.”
However, Preska ignored the US government’s position and ruled against Argentina.
Argentina last week lodged a formal appeal Thursday after Preska ordered the nation to sell its majority stake in state oil firm YPF.
The judge has ordered Argentina to sell its 51 percent stake in YPF towards settling a debt of US$16.1 billion to two former minority shareholders.
Argentina in 2012 seized 51 percent of the company from Spanish oil giant Repsol, which received about US$5 billion in compensation.
But minority shareholders Petersen Energia and Eton Park Capital – which jointly held about 25 percent of the company – went to court claiming they were not properly compensated.
Judge Preska ruled in favour of the plaintiffs and in September 2023 ordered Argentina to pay the two firms, which has not happened.
Last week, the judge said Argentina must sell its stake in YPF to offset the debt.
The Argentine Treasury's legal division has confirmed the nation has initiated appeal proceedings.
Speaking to the Noticias Argentinas news agency, Sebastián Maril, CEO of Latam Advisors, gave an expert view, explaining that an amicus brief amounts to formal support from an independent third party in a case, “adding arguments to persuade the judge or panel of judges to rule in favour of the party receiving support.”
Maril clarified that, for now, the US Department of Justice’s intervention does not appear to extend to the broader appeal over the US$16.1-billion ruling, nor does it directly address the order to hand over shares.
This latest intervention aims to reverse that outcome and prevent Argentina from being forced to immediately relinquish its majority stake in YPF.
Burford Capital is expected to file its objection to Argentina’s request for an extended suspension on July 17, with the Argentine government scheduled to submit its arguments in favour of maintaining the stay on July 22.
A decision is pending on Argentina's request for the payment to be suspended until its appeal is heard.
The ruling is seen as a setback for President Milei, whose administration is seeking to bolster foreign currency reserves and rein in soaring inflation while navigating a heavy debt burden.
If it loses its appeal, Argentina has vowed to seek relief from higher courts.
– TIMES/AFP/NA/PERFIL
Comments