Argentine lawmakers passed a measure on Thursday that will allow the country to sidestep a U.S. court order that froze money to pay back debt.

The law passed the lower house by a vote of 134 to 99 in favor after it was approved by the Senate last week.

Under the new law the repayment location is moved from New York to either Buenos Aires or Paris or through a bondholder.

Argentina has to make good on debt payments of $200 million by Sept. 30, according to AFP.

The law is seen as the latest move by Argentina in a legal battled with creditors who refused to join the restricting deal when Argentina defaulted on its debts of $100 billion in 2001.

Under that deal, 93 percent of the country's creditors accepted a cut of 70 percent of the face value of their Argentine bonds.

But two foreign hedge funds, U.S. billionaire Paul Singer's NML Capital and U.S.-based Aurelius Capital Management, refused to accept the write-down and took Argentina to court.

They won a court ruling from U.S. federal Judge Thomas Griesa on July 30 ordering the country to pay them the full $1.3 billion due.

The judge also blocked Argentina from repaying its other creditors, arguing it couldn't pay some bondholders and not others. Judge Griesa froze $539 million Argentina deposited at the Bank of New York Mellon to the bondholders who accept debt restructurings in 2005 and 2010. That action caused the international credit rating firms to declare Argentina in default again in July

The new law defies Griesa's ruling that moving the repayment site outside the United States would be illegal.

Argentina was also seeking information from the Securities and Exchange commission into whether NML profited in credit default swaps at all from the blocked debt payment after the court decision, according to Bloomberg.

The same hedge fund was involved in trying to seize property in Congo-Brazzaville and debt disputes with Greece, according to the Guardian. Countries like Grenada and Ukraine are also starting to create concern with stepped up buying of emerging market bonds in Kenya, Ecuador and Ivory Coast, according to Foreign Policy magazine.

The IMF, U.S. government and U.N. and World Bank all were concerned about the court victory for predatory hedge fund owners against Argentina.

In August, the International Capital Market Association submitted a proposal to alter debt rules to restring predatory behavior.

In a related story, the U.N. General Assembly passed a historic resolution to begin treaty negotiations to enact a global bankruptcy process and stop predatory hedge funds.

The treaty could make it more difficult for hold-out investors to block countries from debt restructuring and could limit future defaults. Out of 193 countries, 124 voted yes to the treaty, and 11 voted no with 41 abstentions. The U.S., despite its concerns over predatory hedge funds, voted no along with 10 other countries. 

"The strong majority vote shows how powerful the global consensus is to stop predatory financial behavior," said Eric LeCompte, the executive director of Jubilee USA. "If we are going to solve what global leaders believe is the root cause of inequality, we need a bankruptcy system in place."