Elizabeth Mireya Freidenberg February 26 2014 Central Bank restricts payment methods for international airline tickets Freidenberg Freidenberg & Lifsic | Aviation - Argentina Elizabeth Mireya Freidenberg Aviation On December 2 2013 the Central Bank issued Communication A5499, which entered into force the following day. The communication states that in order to sell international airline tickets, tickets where at least one leg takes place outside Argentina or tickets for tourist services in Argentina or abroad to a non-Argentinian resident, all sales must occur:through a debit or credit card issued abroad;through a wire transfer in a foreign currency from an account abroad;via cheques drawn from a bank account outside Argentina; orin foreign currency (cash).Otherwise, any amount resulting from such sales will not be permitted for referral abroad.This raises significant concerns for international carriers operating in Argentina (even those operating as offline carriers) which – added to the recent rise in taxes applicable to airline tickets sales – will make operating flights to or from Argentina increasingly difficult. The main issue relates to the fact that the communication refers to 'non-residents' instead of 'foreigners', thereby making it impossible for carriers to comply unless sales take place in person and the sales agent can verify the passenger's place of residence from his or her passport or identity document.Approximately 95% of passenger tickets are sold by travel agencies, facilitated through the Billing and Settlement Plan run by the International Air Transport Association (IATA). Consequently, airlines cannot themselves control whether the buyer is a non-resident. This puts airlines in a difficult position, since they cannot comply with something that is beyond their direct control. The problem becomes even greater if online sales are considered. During an online sale, the website can check only the nationality of the payer; whether the person attempting to buy an airline ticket is resident abroad is unknown. Furthermore, in order to remit moneys abroad for the sale of tickets, the company's legal representative must sign a sworn statement to the bank confirming that all of the moneys that the company seeks to remit correspond to sales to residents (something that he or she cannot truly confirm).La Cámara de Compañías Aéreas en Argentina (the chamber that represents airlines operating in Argentina) has held various meetings with the Central Bank and IATA representatives. A revised version of Communication A5499 has been promised by the Argentinian authorities, but as yet there has been no further news regarding such modifications. Until this change occurs, all that the aviation industry can do is wait for this latest storm to pass.For further information on this topic please contact Elizabeth Mireya Freidenberg at Freidenberg Freidenberg & Lifsic by telephone (+54 11 4311 4991), fax (+54 11 4311 0852) or email ([email protected]).