UK Supreme Court rejects hearing of Argentina’s £1bn bond case

The highest court in the UK has rejected Argentina’s bid to hear its appeal, over a legal ruling that has hit the South American country with a £1bn bill.

The case stems Argentina’s non-payment of GDP-linked sovereign bonds in 2014. Under the terms of the bonds, payments were conditional on Argentina’s annual economic performance.

The Argentine economy was on track to trigger a payment during 2013, which would have amounted to several billion euros across the different bond series.

However, the country abruptly ceased publishing its historic GDP data series, changed calculation processes, and issued a final year GDP growth figure fractionally below the payment threshold.

Argentina also refused to apply the transition provisions in the bond documentation designed especially for when calculation processes change to ensure consistency between different years.

A mammoth lawsuit was filed in the English High Court on behalf of bondholders, including Palladian Partners, back in 2019, with a trial heard over October and November 2022.

Less than a year later, the High Court issued a judgment siding with the bondholders, ordering Argentina to cough up more than £1.1bn, including interest and other costs.

The South American country sought to appeal the decision, but in June 2024 the Court of Appeal upheld the ruling.

For its last option, Argentina tried to appeal to the Supreme Court, but on Monday evening, the court refused the country’s application for permission.

The lawyers noted that the judgment in this lawsuit is now final, and in 45 days, the bondholders will collect on the $350m appeal deposit.

Aidan O’Rourke, partner at Quinn Emanuel, on for the bondholders, explained that “the claimants have always been confident in their case, and are pleased with the Supreme Court’s decision to refuse permission to appeal.”

“The 2013 payment for €1.3bn (plus interest) has been outstanding for nearly 10 years, and the claimants look forward to Argentina paying all the warrant holders within the 45 day period set by the court.”

“During the course of this case, Argentina has repeatedly said to the court that if a final decision is made in favour of the warrant holders that the money to pay its creditors will need to be found. That time has now come,” he added.