The US Treasury Department on Wednesday issued a general license authorizing certain transactions related to the Petroleos de Venezuela, S.A. (PdVSA) 8.5% bond from 2020 on or after October 20
WASHINGTON (Pakistan Point News / Sputnik - 19th July, 2023) The US Treasury Department on Wednesday issued a general license authorizing certain transactions related to the Petroleos de Venezuela, S.A. (PdVSA) 8.5% bond from 2020 on or after October 20.
"(O)n or after October 20, 2023, all transactions related to, the provision of financing for, and other dealings in the Petróleos de Venezuela, S.A. 2020 8.5 Percent Bond that would be prohibited by subsection l(a)(iii) of Executive Order (E.O.) 13835 of May 21, 2018, as amended by E.O. 13857 of January 25, 2019, and incorporated into the Venezuela Sanctions Regulations, 31 CFR part 591, are authorized," the license said.
The license entirely replaces General License 5K from April 19, which delayed the authorization of General License 5 until July 19. The Treasury Department clarified that the latter removed an obstacle to holders of the PdVSA 2020 8.5% bond gaining access to their collateral.
The new license once again revises and postpones the deadline for lifting restrictions on transactions with the Venezuelan company's bond until October 20.
Following the default of the Venezuelan government on its 8.5% bond in 2019, the creditors gained the right to foreclose on the collateral, which included, among other things, the shares of the US oil refinery CITGO Petroleum Corporation that was owned and controlled by PdVSA. General License 5 originally authorized all transactions related to the 8.5% bond.
However, the Treasury Department decided to postpone the effectiveness of the license, which continues to date, after Venezuelan opposition leader Juan Guaido advised the US government not to allow bondholders of the 8.5% bonds to take control of CITGO by enforcing their collateral on CITGO's shares, according to reports.
