Argentina Appeals US$16.1 Billion YPF Nationalization Judgment in New York

High-Stakes Appeal Underway in New York

The government of Argentina is currently engaged in a critical legal battle in a New York courtroom, seeking to overturn a US$16.1 billion judgment. This substantial award was issued against the nation in relation to its 2012 nationalization of the energy company YPF SA. Oral arguments in Argentina's appeal were presented on Wednesday, October 29, 2025, before the 2nd U.S. Circuit Court of Appeals in Manhattan.

Roots of the Dispute: YPF Nationalization and Bylaw Breach

The legal saga originates from Argentina's 2012 decision to expropriate 51% of YPF's shares from Spain's Repsol. While compensation was paid to Repsol, minority shareholders, specifically Petersen Energía Inversora and Eton Park Capital Management, claimed they were not extended a mandatory tender offer as stipulated by YPF's bylaws. These claims were later acquired and largely funded by the litigation finance firm Burford Capital.

In September 2023, U.S. District Judge Loretta Preska in New York ruled that Argentina had indeed breached YPF's bylaws, which required a tender offer to all shareholders. The judgment ordered Argentina to pay US$14.39 billion to Petersen and US$1.71 billion to Eton Park, including significant prejudgment interest.

Argentina's Appeal and Legal Arguments

Argentina is appealing Judge Preska's ruling, arguing that the case should never have been heard in a U.S. court and that the nation did not waive its sovereign immunity. Furthermore, Argentina contends that the awarded damages are grossly inflated, representing approximately 45% of its overall budget for 2024. The country's legal team also asserts that Preska misapplied Argentine law and that principles of international comity should have led to a dismissal.

The 2nd U.S. Circuit Court of Appeals is expected to take several months to reach a decision, after which either side may petition the U.S. Supreme Court.

Economic Implications and International Concerns

The potential enforcement of the US$16.1 billion judgment poses a significant threat to Argentina's economy, which has long grappled with debt and high inflation. In a separate but related development, Judge Preska had previously ordered Argentina to turn over 51% of its YPF shares to partially satisfy the judgment. However, this 'turnover order' has been stayed by the 2nd Circuit Court of Appeals pending the outcome of the main appeal.

The U.S. government, including the Justice Department and the Biden administration, has expressed concerns regarding the potential seizure of foreign sovereign property. They warn that such actions could interfere with U.S. foreign policy and expose U.S. assets to similar treatment in foreign courts. The outcome of this case is being closely watched by the international business community, as it could influence cross-border investment protection and the interaction between foreign governments and global capital markets.