PUBLIC EMERGENCY AND REFORM OF THE CHANGEROUS REGIME Law 25.561 Please describe the public emergency in social, economic, administrative, financial and exchange matters. Change system. Amendments to the Convertibility Act. Restructuring of obligations under this law. Obligations linked to the financial system. Obligations originated in management contracts governed by public law standards. Obligations originated in contracts between individuals, not linked to the financial system. Song of titles. Protection of users and consumers. Complementary and transitional provisions.

Sanctioned: January 6, 2002.

Partially promulgated: January 6, 2002.

The Senate and Chamber of Deputies of the Argentine Nation assembled in Congress, etc. sanction with force of Law:

PUBLIC EMERGENCY LAW AND REFORM OF THE CHANGE REGIME

PART I

Public emergency declaration

ARTICLE 1 Determine, in accordance with article 76 of the National Constitution, the public emergency in social, economic, administrative, financial and exchange matters, delegating to the national executive branch the powers covered by this Act until 10 December 2003 in accordance with the following basis:

1. Proceed to the reordering of the financial, banking and exchange market.

2. Reactivate the functioning of the economy and improve the level of employment and income distribution, with an emphasis on a development programme for regional economies.

3. Create conditions for sustainable economic growth that are compatible with the restructuring of public debt.

4. Rule the restructuring of the obligations under way, which are currently being implemented, affected by the new exchange regime established in article 2.

PART II

From the currency regime

ARTICLE 2 The national executive branch is empowered, for the reasons of public emergency defined in Article 1 to establish the system that will determine the relationship of exchange between foreign peso and foreign currency, and to issue exchange regulations. PART III

Amendments to the Convertibility Act

ARTICLE 3 Please refer to articles 1, 2nd, 8th, 9th, 12th and 13 of Act No. 23,928, as amended by Act No. 25,445. ARTICLE 4 Amend the text of articles 3°, 4°, 5°, 6°, 7° and 10 of Act No. 23.928 and its amendment, which shall read as follows:

"Article 3 El The CENTRAL BANCO OF THE REPUBLIC ARGENTINA may purchase currency with its own resources or issue the necessary weights for that purpose, and sell them, at the price established under the system defined by the national executive branch, in accordance with article 1 of the Law on Public Emergency and Change Reform.

"Article 4° . At all times, the reserves of the BANCO CENTRAL OF THE ARGENTINA REPUBLIC in gold and foreign currency will be affected to the backing of the monetary base. When reserves are invested in deposits, other operations in interest, or in national or foreign public securities payable in gold, precious metals, US dollars or other similar solvency currencies, their compute for the purposes of this law shall be made at market values.

"Article 5 El The CENTRAL BANCO OF THE REPUBLIC ARGENTINA must reflect in its balance and accounting states the amount, composition and investment of reserves, on the one hand, and the amount and composition of the monetary base, on the other hand.

"Article 6 . The goods that make up the reservations mentioned in the previous article constitute a common garment of the monetary base, are inembarkable, and can be applied exclusively to the purposes provided for in this law. The monetary base in pesos is constituted by the monetary circulation plus the deposits in view of the financial entities in the BANCO CENTRAL OF THE ARGENTINA REPUBLIC, in current account or special accounts.

"Article 7° . The debtor of an obligation to give a certain sum of weights fulfills its obligation by giving the nominally expressed amount on the day of its expiry. In no case will monetary update, price indexing, cost variation or debt repotentiation be admitted, whatever its cause, whether or not the debtor is in arrears, with the exceptions provided for in this law.

The legal and regulatory provisions are repealed and the contractual or treaty provisions that contravene the provisions of this provision will be inapplicable.

"Article 10. . Mantiénense derogadas, with effect from 1 April 1991, all the legal or regulatory rules that establish or authorize indexing by prices, monetary update, variation of costs or any other form of repotentiation of debts, taxes, prices or fees of goods, works or services. This derogation shall apply even to the effects of existing legal relations and situations, and no legal, regulatory, contractual or conventional clauses may be applied or invoked .including collective labour agreements colectivo of the previous date, as a result of adjustment in the amounts of pesos to be paid. "

ARTICLE 5° Keep, with the exceptions and scopes set out in this Act, the wording set out in article 11 of Act No. 23.928 for articles 617, 619 and 623 of the Civil Code. PART IV

Restructuring of obligations under this law

Chapter I

Financial system obligations

ARTICLE 6 The national executive branch shall have measures to reduce the impact of the change relationship set out in article 2 of this law on persons of visible or ideal existence who maintain debts in US dollars or other foreign currency with the financial system. It will have the necessary rules for their adequacy.

The national executive branch will restructure the debts to the financial sector, establishing the exchange ratio UN PESO ($ 1) = UN DÓLAR (U$S 1), only in debts to the financial system whose original amount was not higher than DOLARES CIEN MIL (U$S 100,000) in relation to: (a) Mortgage credits for housing acquisition; (b) To the construction, refraction and/or expansion of housing; (c) Personal credits; (d) Pre-paid loans for the acquisition of motors; and (e) To those of credits of individuals or legal entities that meet the requirements of micro, small and medium-sized enterprises (MIPyME). Or even that amount when it is greater in the cases of subparagraph (a) if the provision was applied to the acquisition of the single and family housing and in the case of subparagraph (e).

The national executive branch may establish compensatory measures to avoid imbalances in the financial entities covered and emerging from the impact of the measures authorized in the preceding paragraph, which may include the issuance of national Government titles in guaranteed foreign currency. In order to constitute such a guarantee, believe a right to export hydrocarbons by the term of CINCO (5) years by empowering the national executive branch to establish the corresponding liquota. To that end, other resources including international loans may be affected.

In no case shall the right to export hydrocarbons diminish the value of a well for the calculation and payment of royalties to the producing provinces.

The national executive branch shall have the measures to preserve the capital belonging to the savers who have made deposits in financial entities at the date of entry into force of Decree 1570/2001, restructuring the original obligations in a manner compatible with the evolution of the solvency of the financial system. Such protection shall include foreign currency deposits.

ARTICLE 7 Debts or balances of debts originally agreed upon with financial system entities in force as at 30 November 2001 and converted to dollars by Decree No. 1570/2001 will remain in the original currency agreed upon, both capital and its accessories. Refer to article 1 of Decree 1570/2001.

The debtor balances of credit card holders and debits corresponding to consumptions made in the country shall be disclosed in pesos and payable in pesos. Consumptions made outside the country may only be recorded in dollars or other currencies. The outstanding debtor balances at the date of promulgation of this law shall be cancelled in pesos to the exchange relationship A STEP ($ 1) = A TOTAL STATE ($1).

Chapter II

Obligations arising from management contracts governed by public law

ARTICLE 8 Please note that, from the sanction of this Act, contracts entered into by the Public Administration under public law standards, including those of public works and services, adjustment clauses in the dollar or other foreign currency and index clauses based on price indexes in other countries and any other indexing mechanism are invalid. Prices and fees resulting from such clauses are set in weights to the exchange ratio A STEP ($ 1) = A STATEMENT (US$ 1). ARTICLE 9 Authorize the national executive branch to renegotiate contracts under Article 8 of this Law. In the case of contracts aimed at the provision of public services, the following criteria should be taken into consideration: (1) the impact of tariffs on the competitiveness of the economy and on the distribution of income; (2) the quality of services and investment plans, where they were contractually planned; (3) the interest of users and the accessibility of services; (4) the security of the systems covered; and (5) the profitability of the companies. ARTICLE 10. The provisions provided for in articles 8 and 9 of this Act shall in no case authorize contractors or public service providers to suspend or alter the performance of their obligations.

Chapter III

of obligations arising from contracts between individuals, not linked to the financial system

ARTICLE 11. The dinerary benefits required from the date of promulgation of this law, originated in contracts between individuals, subject to private law rules, agreed in dollars or other foreign currency or in which adjustment clauses had been established in dollars or other foreign currency, are subject to the following regulation: (1) the benefits shall be cancelled in pesos to the exchange ratio UN PESO ($ 1) = A DOLAR ESTADOUNIDENSE (U$S 1), as a payment on account of the sum that ultimately results from the procedures set forth below; 2) the parties will negotiate the restructuring of their mutual obligations, seeking to share in an equitable manner the effects of the modification of the exchange relationship resulting from the application of the provisions of Article 2 of this Law, for a period not exceeding CENTO 180 days. Agreed to the new conditions, the differences that may eventually exist between the payments given to account and the definitively agreed values shall be compensated; (3) if the parties fail to agree, they are empowered to follow the mediation procedures in force in the respective jurisdictions and to occur before the competent courts to settle their differences. In this case, the debtor party may not suspend payments on account or the creditor refuse to receive them. The national executive branch is empowered to make clear and regulatory provisions on specific situations, based on the doctrine of article 1198 of the Civil Code and the principle of shared effort. PART V

From the title exchange

ARTICLE 12. Within the time period and in the manner in which the regulation is established, the national executive branch shall have the necessary precautions to proceed with the exchange of national and provincial titles that have been issued as substitutes for the national currency of legal course throughout the country, subject to agreement with all provincial jurisdictions. PART VI

Protection of users and consumers

ARTICLE 13. Please refer to the national executive branch to regulate, temporarily, the prices of critical inputs, goods and services, in order to protect the rights of users and consumers, the eventual distortion of markets or actions of a monopolistic or oligolic nature. PART VII

Supplementary and transitional provisions

ARTICLE 14. Invite the Provinces, Autonomous City of Buenos Aires and Municipalities to adhere to the provisions of Articles 8, 9 and 10 of this Law. ARTICLE 15. Replace the application of Act No. 25,466, for the maximum period provided for in article 1 or until the time at which the national executive branch considers the emergency of the financial system to be overcome, with regard to deposits affected by Decree No. 1570/2001. ARTICLE 16. Replace the application of Act No. 25.557 for the term of up to NOVENTA (90) days. For the period of CENTO OCHENTA (180) days the dismissals are suspended without justified cause. In the event of dismissals in contravention of the provisions of this Act, employers shall pay the injured workers twice their compensation, in accordance with the current labour legislation. ARTICLE 17. Negative net results originating in the application of the exchange rate referred to in Article 2 of this Law on Assets and Liabilities in Foreign Currency Existing at the date of its sanction, shall only be deductible in the Tax on Gains in the proportion of a VEINTE BY SCIENTO (20%) per year in each of the first five years that close after the law is in effect. The above provisions shall be applicable only to subjects whose annual income or property exceeds the limits set forth in article 127, Chapter XIII, Title I, of Law No. 11.683, t.o. in 1998 and its amendments. ARTICLE 18. Amend article 195 bis of the Code of Civil and Commercial Procedure, which shall read as follows:

"When precautionary measures that directly or indirectly affect, obstruct, commit or disrupt the development of essential activities of the National State, the Provinces, the Autonomous City of Buenos Aires, the Municipalities, their centralized or decentralized divisions, or of entities affected by any activity of State interest, appeal may be filed directly with the Supreme Court of Justice of the Nation. The submission of the appeal shall have in itself a suspensive effect of the ruling. The Supreme Court of Justice of the Nation will require the remission of the file. Received this, it will confer transfer with quality of cars to the party that requested the measure for the period of CINCO (5) days. Once the transfer has been transferred or the time has expired to do so, after hearing the Attorney General of the Nation will issue a ruling confirming or revoking the measure. "

ARTICLE 19. This law is of public order. No person can claim against irrevocably acquired rights. Default any other provision that opposes the provisions of the provision. ARTICLE 20. For all the purposes of this law, the Bicameral Monitoring Commission shall control, verify and dictate the actions of the Executive. Views in all cases will be considered by both Chambers. The Bicameral Commission will consist of six senators and six deputies elected by the Honorable Houses of Senators and Deputies of the Nation, respecting the plurality of the political representation of the Chambers. The President of the Commission will be appointed on the proposal of the opposition political bloc with more legislators in Congress. ARTICLE 21. The national executive branch shall bear in mind the exercise of the powers delegated to it at the end of its validity and on a monthly basis, through the Chief of Staff of Ministers at the time of the participation of each House of Congress, as provided for in article 101 of the National Constitution. ARTICLE 22. Contact the national executive branch.

IN THE SESSION OF THE ARGENTINE CONGRESS, IN GOOD AIRES, TO THE SEIS DAYS OF THE MONTH OF JANUARY OF THE YEAR.

# 25,561

EDUARDO O. CHANGE. . JUAN C. MAQUEDA. . Eduardo D. Rollano. . Juan C. Oyarzún.

NOTE: The bold text was observed.