WASHINGTON (Pakistan Point News / Sputnik - 10th April, 2020) The United States has blocked until July 22 any sale or transfer of debt held by US bondholders in Venezuela's state-owned oil company PdVSA, to prevent the government of President Nicolas Maduro from seizing those bonds, according to a document posted online by the US Treasury Department on Friday.
"Between October 24, 2019 and July 22, 2020 (the date the authorization in General License 5C becomes effective), there is no authorization in effect that licenses against subsection 1(a)(iii) of E.O. 13835 applicable to the holders of the PdVSA 2020 8.5 percent bond," the document said. "As a result, during such period, transactions related to the sale or transfer of CITGO shares in connection with the PdVSA 2020 8.5 percent bond are prohibited, unless specifically authorized by OFAC."
The US government issued an original order on October 24 to block through January 22 a creditor seizure of PdVSA's US subsidiary Citgo, whose shares were used as collateral for the bond issue.
Venezuela opposition leader and self-proclaimed President Juan Guaido took control of Citgo in early 2019 after the US government recognized him as the country's legitimate leader.
After Guaido's takeover of Citgo, the bond went into default when a $913 million payment came due and he and his allies filed a US lawsuit requesting the bond be declared null.
The order issued on Friday effectively prevents creditors of PDVSA from seizing shares in the parent company of Citgo through July 22.
