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High Court asked to recognise €15.4bn judgment against Argentina

Applicants want previous New York judgment recognised in several jurisdictions, including Ireland, as part of efforts to enforce it

Two applicant groups claim a 2012 vote of Argentina’s congress (above) led to that state acquiring 51 per cent of YPF from then-majority shareholder Repsol. Photograph: Getty

Aodhan O'Faolain
Thu Apr 25 2024 - 17:52

The Irish High Court has been asked to formally recognise a €15.41 billion ($16.5 billion) judgment against the state of Argentina.

The application to recognise the New York court’s judgment in this jurisdiction has been made by two groups who were each minority shareholders in the Argentinian Energy Company YPF.

The first group is the Spanish-registered Petersen Energia Inversora SAU and the related Peterson Energia SAU, which are both in liquidation.

The second group is Eton Park Capital Management LP and Eton Park Fund LP, which are registered in the US, and Eton Park Master Fund Ltd, which is registered in the Cayman Islands.

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The two groups successfully sued the Argentinian state and YPF over the South American nation’s renationalisation of the company in 2012.

YPF was privatised when 100 per cent of the firm’s shares were sold through an IPO on the New York Stock Exchange in the early 1990s.

Between 2008 and 2011, the Peterson Group acquired 25 per cent of the ownership of the company.

In and around the same period the Eton group acquired some 3 per cent of YPF.

The two groups claim that in 2012, following a vote of Argentina’s congress, the state acquired 51 per cent of YPF from the then-majority shareholder Repsol, which is a Spanish entity.

The two minority shareholders said the Argentinian state failed to make a public offer for the other 49 per cent of its shares at a price prescribed in the original share offer.

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This action, the groups claim, was in breach of the law and resulted in the two groups sustaining significant losses and damages.

The two groups brought an action before the New York courts seeking damages and prejudicial interest for breach of contract against both YPF and the Argentinian state which ran for several years.

The claims were denied and the actions opposed.

The courts found in their favour and awarded the Petersen Group some $14.38 billion while the Eton companies were awarded $1.71 billion.

The decisions have been appealed, but the awards are not the subject of a stay.

At the High Court on Thursday the two groups secured permission, ex parte, from Mr Justice Michael Twomey to apply to have the judgment recognised by the Irish courts.

The application was not opposed.

The applicants, represented in the proceedings by Declan McGrath SC and Stephen Byrne, say they want the New York judgment recognised in several jurisdictions, including Ireland, as part of their efforts to enforce the ruling.

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The groups say the application has been made here because the Irish courts are extremely highly regarded internationally with a “very strong reputation for predictability, speed, efficiency and impartiality and fair procedures”.

Recognition of the judgment, the groups also claim, will help them obtain an order helping them to know the whereabouts of assets belonging to the Argentinian state and to establish if any assets are in Ireland.

Argentina, it was submitted, could move assets to this jurisdiction at some point in the lifetime of the judgment, given Ireland is the place of domicile of 6 per cent of worldwide fund investment assets.

This makes Ireland the third-largest global centre of fund administration and the second-largest in the EU.

Ireland is also an international listing hub for debt securities and a potential place where Argentina could list debt securities, the groups claim.

It is also argued that the absence of assets owned by the Argentinian state in Ireland is not a reason for rejecting the application for recognition.

The case will return before the courts at a later date.

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