Modifications to Rules on the Competence of the Argentine Securities and Exchange Commission

Following the modifications introduced by the Productive Financing Law No. 27,440, sanctioned by the Argentine Congress on May 9, 2018, and its regulatory Decree No. 471/2018, issued on May 17, 2018, the Argentine Securities and Exchange Commission (“CNV”, after its acronym in Spanish) issued Resolution No. 736 on May 24, 2018, by means of which it reduces its faculties as controlling authority in corporate matters.

Under the new rules, the CNV must only exercise control in corporate matters with respect to corporations (sociedades anónimas) domiciled in the City of Buenos Aires and in Provinces that have adhered to the regime established by Law No. 22,169, that make public offering of their shares. All other companies, including those registered under the SMBs CNV Regime (“Régimen PyME CNV Garantizada”) introduced by the Productive Financing Law, must be subject to control in corporate matters by the competent bodies of the relevant jurisdictions.

In this sense, Resolution No. 736 abrogated several sections of the CNV Rules that granted faculties to the CNV to exercise control in corporate matters over (i) corporations registered as Managing Companies and Depository Companies of mutual funds; (ii) trustees registered with the relevant registry of the CNV and financial entities that act as trustees in the terms of Law No. 21,526; (iii) corporations registered as stock markets; (iv) corporations registered as clearing agencies; (v) corporations registered as depository agents (“agentes de depósito colectivo”) or custody, registry and payment agents (“agentes de custodia, registro y pago”); and (vi) corporations registered as credit rating agencies (“agente calificador de riesgo”).

In all such cases, the controlling authority in corporate matters must be the competent body of the relevant jurisdiction (e.g. the Public Registry of the City of Buenos Aires, or “Inspección General de Justicia”, for companies domiciled in the City of Buenos Aires), provided that such entities do not make public offering of their shares.