PARIS--The French government said Friday it is supporting Argentina's U.S. Supreme Court appeal in a closely watched case involving hedge funds that are trying to collect on the South American country's defaulted debt.
French finance minister Pierre Moscovici said in statement that France will intervene as amicus curiae in favor of Argentina's June 24 petition before the Supreme Court.
Argentina is asking the Supreme Court to review the Second U.S. Circuit Court of Appeals's ruling last October that ordered the South American country to pay more than $1.3 billion to hedge funds that are suing for full repayment on defaulted bonds.
Mr. Moscovici said France's intervention is not specifically linked to the Argentina case. Rather, Paris fears that the decision to order Argentina to pay could dissuade other creditors from participating in restructuring sovereign debt in the future.
"The principle of ordered and negotiated sovereign debt restructuring, particularly those carried out by the Paris Club, could be affected," Mr. Moscovici said in a statement.
The decade-old legal saga stemming from Argentina's $100 billion default in 2001 has come to involve the International Monetary Fund and the U.S.
On Tuesday, the IMF backed away from a plan to support Argentina's appeal. The IMF said Managing Director Christine Lagarde withdrew her recommendation for a high-court brief after U.S. Treasury officials said it wasn't the right time for the fund to get involved in the case.
The Supreme Court won't decide until this fall whether to hear Argentina's appeal.
So far, Argentina has restructured about 93% of its defaulted debt.
If Argentina is forced to pay the holdouts, it may not be able to pay creditors that have consented to debt-restructuring efforts in the past, Mr. Moscovici said.
"France's decision aims to alert the Supreme Court of the possible implications of its decision for the good functioning of the international financial system," he said.
Write to William Horobin at william.horobin@wsj.com and Ken Parks at ken.parks@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
July 26, 2013 16:55 ET (20:55 GMT)
Copyright (c) 2013 Dow Jones & Company, Inc.
john carlson greg smith catamount mike dantoni bulls heat goldman sachs brandon carr
No comments:
Post a Comment