La Corte de Apelaciones del Segundo Circuito de Nueva York, EE.UU., ha aceptado los argumentos de la administración ad hoc de Petróleos de Venezuela S.A. (Pdvsa) de que la Constitución venezolana sí aplica a los bonos de 2020. Esta decisión se produce luego de que la estatal PDVSA, bajo control de Nicolás Maduro, apalancara el 50,1% de las acciones de Citgo como garantía para la emisión de deuda. El 3 de julio, la Corte declaró válido el recurso de apelación de la junta ad hoc de PDVSA, enfatizando que los bonos no fueron aprobados por la Asamblea Nacional venezolana, dejándolos sin efecto. El fallo se alinea con una decisión anterior de febrero de la Corte de Apelaciones del Estado de Nueva York, que también reconoció la aplicabilidad de la ley venezolana pero aplazó la sentencia final a los tribunales federales. La situación proporciona un alivio temporal para Citgo, ya que la Oficina de Control de Activos Extranjeros (OFAC) del Tesoro de los EE. UU. había extendido previamente una licencia que impedía a los tenedores de bonos actuar contra Citgo hasta el 13 de agosto. Los bonos en cuestión se remontan a un acuerdo de refinanciamiento de 2016 bajo Maduro, al que se opuso por la Asamblea Nacional por apalancamiento excesivo de Citgo. Desde finales de 2017, Venezuela ha incumplido el pago de su deuda externa, agravado por las sanciones estadounidenses desde 2019. Esta decisión marca un punto importante en las batallas legales en curso que involucran a los acreedores venezolanos. Texto original por Ahiana Figueroa, publicado en-> TalCual

Venezuela faces two significant events next month: a presidential election and the announcement of the winner of a U.S. court-ordered auction for PDV Holding, the Venezuelan owner of Citgo Petroleum. The Caracas military dictatorship is attempting to manipulate the July 28 election and blame the democratic opposition for Citgo’s potential loss. This narrative overlooks that the auction is to compensate for expropriations made by Hugo Chávez’s Bolivarian revolution. The electoral environment in Venezuela is skewed, with political activists jailed and the popular opposition candidate, María Corina Machado, blocked from running. Despite this, substitute candidate Edmundo González Urrutia leads in polls by over 20 points. However, dictator Nicolás Maduro is unlikely to concede and may rig the results, as evidenced by new polling stations in controlled areas and potential voter harassment. Twenty-eight former heads of state and allies like Brazil and Colombia have urged Maduro to respect the election results. Citgo, a symbol of Venezuelan pride, is central to the regime’s plan to justify a fraudulent election result, blaming the opposition for creditor claims. However, this doesn’t align with voter surveys showing strong opposition against Maduro. The Chávez-Maduro regime, in power since 1999, has amassed over $140 billion in external debt. Chávez’s expropriation spree led to investor disputes, with Canadian company Crystallex winning a $1.4 billion arbitration award, leading to the current auction of PDV Holding shares. The U.S. previously protected Citgo during the interim Guaidó government, but once that effort failed, Venezuela had to face the repercussions of its actions. Next month’s auction, if it proceeds, will be a critical juncture in Venezuela’s ongoing economic and political crisis. Original text by Mary Anastasia O’Grady, published in-> Microsoftstar

Venezuela’s upcoming presidential election on July 28 is widely anticipated to be neither free nor fair. Opposition candidate Maria Corina Machado has been prohibited from running, and her substitute has also been barred. The regime has announced the exclusion of EU election observers and has altered polling places to confuse voters. These measures are likely necessary for President Nicolás Maduro, who is polling at less than 20%, and in some polls, under 10%. Separate from the election, a U.S. federal judge is proceeding with the sale of Venezuela’s largest asset, the CITGO oil company, marking the largest court auction of an asset in history. This decision has been termed “truly extraordinary” and “rare,” with CITGO considered an alter ego of Venezuela, which allows creditors to benefit first from the auction due to crimes like expropriations committed by the Maduro regime. There are suspicions that the U.S. State Department may have a covert involvement in this process. This situation is seen as beneficial to Maduro. Since 2019, CITGO’s board has been under Venezuela’s opposition’s control, countering Maduro. If CITGO is lost, Maduro is expected to blame the opposition for losing “Venezuela’s foreign crown jewel” and its most valuable foreign asset. The auction’s timing is considered poorly planned as it concludes just weeks before the Venezuelan election. The legal processes around CITGO have been ongoing since 2017, raising the question of why they must conclude imminently before the election. Approving the final sale of CITGO requires a license from the U.S. Office of Foreign Assets Control (OFAC) at the Treasury. Some argue that the Biden administration could mitigate the potential repercussions by writing to the court to request a delay in the final hearing, pointing out that the auction’s timing—originally set before the election date was announced—now appears harmful to U.S. foreign policy and advantageous to Maduro. Although there’s no certainty this would succeed, not making the attempt seems inexcusable. Original text by by Elliott Abrams, published in -> CouncilonForeignRelations

Venezuela’s opposition is considering a plan to delay the sale of oil assets controlled by Citgo Petroleum Corp. by having its holding company file for bankruptcy in the US, sources familiar with the situation revealed. Opposition-appointed executives from Petroleos de Venezuela (PDVSA) are contemplating a US Chapter 11 bankruptcy filing to block the finalization of Citgo’s asset sale. This strategy aims to retain control of Citgo, a critical overseas asset, and potentially increase its sale value or attract a rescue party. Final bids for Citgo’s parent shares are due on June 11, with the winning bidder expected to be announced in July. Charles Tatelbaum, a bankruptcy lawyer not involved in the case, suggested the tactic could provide more time to enhance the sale conditions. Any bankruptcy decision by Citgo’s US parent, PDV Holding, would require consultation with Venezuela’s opposition-led assembly, the only body recognized by the US after it ceased relations with President Nicolas Maduro’s regime in 2019. Yon Goicoechea, a member of the council managing Venezuelan assets abroad, confirmed discussions on various legal strategies had occurred but did not commit to any decision regarding bankruptcy. Under US bankruptcy law, PDVSA can request a judicial halt of actions targeting Citgo assets. However, other companies attempting similar moves have had their cases dismissed. The ongoing auction, overseen by a federal judge in Delaware, involves nearly 20 creditors seeking a share of the proceeds from Citgo’s sale. Judge Leonard Stark has refused to delay the auction’s final stage. Citgo’s management has stated no plans to file for bankruptcy, without commenting on its shareholder, PDVSA. The sale is primarily intended to repay companies, including Siemens AG, ConocoPhillips, and Exxon Mobil Corp., whose Venezuelan assets were seized under former President Hugo Chavez. Conoco claims it is owed more than $1.2 billion. The potential sale loss is a contentious issue in Venezuelan politics, with Maduro’s government framing it as theft of a crucial asset supplying the country with hard currency. Despite PDVSA being controlled by Maduro’s government, its US subsidiaries are managed by a board appointed by the opposition, led by former legislative leader Juan Guaido. The US Treasury Department’s Office of Foreign Assets Control must also approve the sale. Original text by Bloomberg. Published in -> Mint

After the U.S. dropped a broad array of sanctions against Venezuela in October, it warned that it could reimpose all of them, except one. The White House admitted that its ban on buying Venezuelan bonds was a failure that had potentially benefited enemies of the U.S.  Behind the scenes, a group of powerful Wall Street investors had been feeding Washington a stream of evidence that showed Venezuelan bonds were being traded by investors with ties to Russia. They said Moscow was hoping to gain influence in the U.S.’s backyard. The Biden administration said dropping the debt-trading ban “would have the positive effect of displacing nefarious players in this market.” It was the first time the U.S. publicly acknowledged that banning U.S. investors from buying debt of a sanctioned country could backfire. By Kejal Vyas and Alexander Saeedy. Full Text -> WSJ

Dozens of companies have rushed in recent weeks to obtain data and join a U.S. court-ordered auction of shares in a parent of Houston-based oil refiner Citgo Petroleum, Venezuela’s foreign crown jewel, according to people familiar with the matter, as a first-round bidding is set to close on Monday. By Marianna Parraga and Gary McWilliams. Full Text-> Yahoo Finance

Estados Unidos prolongó hasta mediados de abril la licencia que impide que los tenedores de los bonos PDVSA 2020 tomen el control del 50,1% de las acciones de Citgo, filial de la petrolera estatal venezolana, informó este martes el Departamento del Tesoro. La Oficina de Control de Activos Extranjeros (OFAC) de este departamento emitió la licencia 5N que “autoriza ciertas tra nsacciones” relacionadas con los bonos PDVSA con vencimiento en 2020 partir del 16 de abril de 2024. En la práctica esto significa otros tres meses de protección para Citgo, con sede en Estados Unidos. Texto Completo -> DiarioLaAméricas

Venezuela is entering the final stage of a long legal battle in which its most valuable foreign asset, Citgo Petroleum Corp., will be auctioned off to settle claims against the government and its oil company. The sale starts on Monday with the expected distribution of marketing materials to potential buyers, setting off a bidding process expected to last several months.Citgo had been shielded by US sanctions against Venezuela that prevented creditors from seizing the refiner. But a US judge ordered the process for the sale of its parent company, PDV Holding Inc., to begin this month after Washington signaled it wouldn’t stand in the way.More than 20 plaintiffs are now seeking to collect on the auction, scheduled for June 6, while navigating legal roadblocks Venezuela has thrown up. They include bondholders, commercial lenders and companies whose Venezuela assets were taken over by former President Hugo Chavez, who died in 2013. By Fabiola Zerpa, Nicolle Yapur and Jef Feeley, Full Text -> Bloomberg News

“CITGO no se ha perdido gracias a la estrategia diseñada en 2019 por la Asamblea Nacional de 2015. No hay ninguna sentencia de la Corte de Delaware que diga que el Gobierno interino desvió recursos. Se ha citado la sentencia del 23 de marzo de 2023, pero esa sentencia no habla de apropiación alguna ni tampoco se refiere a 19.000 millones. Con errores y aciertos, CITGO sigue siendo propiedad de PDVSA gracias a esa estrategia de defensa. CITGO es hoy una empresa rentable y exitosa”. Por José Ignacio Hernández. Texto Completo -> LaGranAldea

By Alfredo Michelena

The recent decision by the US government to allow the sale of CITGO, a major Venezuelan state asset, has caused controversy and criticism. This decision comes after the Legitimate National Assembly (LNA) decided not to renew the interim government, which had been formed in an effort to break out of the dictatorship that has plagued Venezuela.

The interim government had achieved some international successes with the formation of the Lima Group, the recognition of various ambassadors, and the support of more than fifty governments. However, its attempts to break out of the dictatorship were unsuccessful, which alienated many Venezuelans who wanted a quick change. The intra-party fissures also began to widen, hitting the IG itself. This in turn lead to the decision not to renew the interim government. The change in tone of the representatives of the LAN was quickly appreciated, as they insisted on relaxing the sanctions.

Now, the US government has given the green light to the sale of CITGO, which compromises the integrity of the Republic’s assets. The decision has marked a new stance towards the company, which has been a prime target for Venezuela’s creditors for years. In 2019, the US government gave control of CITGO to Venezuelan opposition leaders as part of a pressure campaign against the country’s president, Nicolás Maduro.

The move was accompanied by sanctions that prohibited bondholders and other creditors from foreclosing on the company. Last year, the Office of Foreign Assets Control (OFAC) said that ending CITGO’s Venezuelan ownership to repay creditors would undercut the US interest in supporting Venezuela’s opposition movement. However, with the Venezuelan opposition losing sway and its parallel government dissolved, OFAC now “intends to implement a favorable licensing policy for license applications in connection with the execution of a sale,” according to a Justice Department letter filed in a Delaware court.

The potential loss of CITGO has been condemned by Mr. Maduro, who has outlasted US sanctions to remain Venezuela’s de facto leader. He called it a “slap in the face” during a May Day speech in Caracas. Meanwhile, the ANL has not established a position on this matter.

The decision to sell CITGO raises questions about the integrity of Venezuela’s assets and the interests of the US government in supporting the opposition movement. It remains to be seen what the consequences of this decision will be, but it is clear that it has sparked controversy and criticism from various parties. The situation in Venezuela remains dire, and it is important to continue seeking solutions that will bring about positive change for the Venezuelan people.