Latest news in Argentina. The Central Bank of Argentina has recently modified the obligation to present the declaration of Relevance of Foreign Assets and Liabilities. Based on the data for the 2018 financial year, the threshold for quantitative limits is eliminated and all companies, assets and similar are required to submit the declaration, regardless of the amounts involved in transactions with external agents.
The purpose of the declaration is to compile, more efficiently, information on the relations of Argentine companies with non-resident economic actors, such as holding shares, foreign investment, foreign suppliers providing services or selling goods to consumers in the country, among others. The deadline for submitting the declarations for the 2019 financial year was 21st February.
Nevertheless, the reason why this declaration is topical has to do with the fact that since the beginning of the 2020 fiscal year, the obligated reporting parties have to present the information quarterly.
It is essential to understand what is considered to be an asset and a liability for the purposes of this statement in order to gather the information to be declared. Assets will be those rights that the tax payer owns towards a resident, while liabilities are not only the obligations (debts) but also the net assets towards external agents.
It is important to note that both balances, understood as positions, and movements or flows are declared. Transactions that have occurred during the period to be reported, and positions at the end of the period, must be recorded under different headings in the form.
Furthermore, it is important to consider that regardless of whether the flows generate a net effect that cancels the operation within the period to be declared, for the purposes of the declaration it is necessary to record the gross variations that have occurred due to transactions.
By way of clarification, the Central Bank of Argentina considers for the purposes of this declaration that the Branches of foreign companies are resident companies and, therefore, obligated. The BCRA has set a deadline of 45 calendar days after the end of each reporting period.
Given that this is a statement with specific formats and categorizations, it is necessary to consult an expert when presenting it in order to be correctly advised. At Auxadi we connect America with Europe, LATAM and Asia, providing value added services to over one thousand clients in more than 50 jurisdictions.