Summary Argentina has been in partial default since the US ruling, which prevents it from borrowing more.
LONDON (AFP) - Argentina on Friday scored a minor legal victory in London in its battle against creditors who are opposed to the debt restructuring deal the country agreed after its devastating default in 2001.
Argentina has an account in London with Bank of New York Mellon (BNY Mellon), which it wants to use to pay interest due to bondholders.
But the funds have been blocked since last year by a US ruling which prevents Argentina from making further reimbursements until it has negotiated a separate agreement with the holdout creditors.
Argentina has been in partial default since the US ruling, which prevents it from borrowing more on international debt markets.
To get around the blockage of its US accounts, Buenos Aires wants to use funds elsewhere in the world, including in London, but the London arm of BNY Mellon has respected the US justice ruling.
That is why the decision by British judge David Richards constitutes a small victory for Buenos Aires.
He ruled that the account, containing 226 million euros ($258 million), did not fall under US law but under English law, Bloomberg news agency reported.
The funds are still blocked but Friday s ruling could pave the way for the account to be unfrozen.
Lawyers for the plaintiffs, who included billionaire financier George Soros, said in a statement that the decision was a "significant step forward in the defence of their interests".
