Argentine Judge Suspends Privatization of the Argentine National Bank
The sign reads, “I defend the national bank.” X/ @NMDP11
February 25, 2025 Hour: 1:14 pm
Previously, President Milei tried to circumvent a law that prevents the privatization of strategic public companies.
On Tuesday, La Plata Federal Judge Alejo Ramos suspended President Javier Milei’s decree aimed at transforming the state-owned Bank of the Argentine Nation (BNA) into a corporation, considering that his decree “constitutes a covert and improper privatization maneuver” of the largest financial institution.
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The “Bases and Starting Points for the Freedom of Argentines” Law, which came into effect in August 2024, establishes that strategic public companies such as Bank of the Argentine Nation, Argentine Airlines, and Fiscal Oilfields (YPF) cannot be subject to privatization.
Faced with the impossibility of directly privatizing these companies, Milei signed a decree on February 20 to convert BNA into a corporation, in which the state would hold 99.9% of the shares, while the BNA Foundation would own the remaining 0.1%.
“This decree reaffirms and deepens the threat of privatization that has been denounced, as it constitutes a decisive step in converting BNA into a corporation, which implies the loss of its status as an autonomous entity of the national state, with the legal, economic, and social consequences that this entails,” Ramos explained.
The federal judge ruled that Milei’s decree exceeded the powers delegated to the Executive by the Bases Law and “constitutes a covert and improper privatization maneuver of Banco de la Nación Argentina.”
Ramos based his decision on a lawsuit filed on June 11, 2024, by the Banking Association, the union representing employees of Argentina’s financial system, which sought the “nullification and unconstitutionality” of a proposal made by BNA itself for its potential privatization.
The La Plata magistrate gave the Milei administration a five-day deadline to submit a report detailing “the public interest at stake in response to the request for the precautionary measure.” He also emphasized that any change in the legal structure of the financial institution must be approved by Parliament and warned that its transformation would be contrary to the provisions of the Bases Law.
Milei’s decree stipulated that the state would exercise its rights in the new banking corporation through the Ministry of Economy, with a share capital of approximately US$1.5 billion.
“Such delegation has an insurmountable limit: the maintenance of these entities within the public sphere. It does not authorize the conversion of BNA into a corporation, as this would remove it from the public law regime and place it under the regulations of the General Companies Law,” Judge Padilla argued.
teleSUR/ JF
Source: EFE
