SMEs: Extension for Financing Through Capital Markets

On December 23, 2024, the Argentine Securities Commission (CNV) issued General Resolution 1039, extending until June 30, 2025, the deadline for applying the 40% threshold allocated to the participation of entities that are not classified as “large companies” within special regimes for establishing financial trusts aimed at financing small and medium-sized enterprises (SMEs). The Resolution also temporarily broadens the eligible assets for SME mutual funds.

This regulation aims to enhance access to capital markets for SMEs, offering tools to secure funding through instruments such as financial trusts and mutual funds.

This Resolution is based on previous regulations, such as General Resolution 997, which expanded the scope of eligible assets for open-ended SME mutual funds. It allows acquiring deferred payment checks and promissory notes, up to a maximum of 20% of the mutual fund’s net assets, for trading in the direct segment (both guaranteed and non-guaranteed) with the first endorsement by companies not classified as “large companies.”

Similarly, General Resolution 1019 introduced a new participant category in financial trust structures. This participant, while lacking a “SME Certificate,” is not classified as a “large company” according to the Argentine Tax Authority (ARCA). The regulation unified criteria for mutual funds and financial trusts, allowing to include rights or credits derived from transactions with companies meeting specific parameters. Initially capped at 20%, this limit was temporarily increased to 40% of the trust’s assets until December 31, 2024.

Finally, the new resolution further expands the list of eligible assets for SME mutual funds, including other publicly offered securities issued by companies not classified as “large companies.” Additionally, it extends the temporary 40% asset limit for financial trusts until June 30, 2025.