Corporate Purposes of Brokers are Now Subject to Limitations

On August 13, 2021, the Argentine Securities and Exchange Commission (“CNV,” after its acronym in Spanish) issued General Resolution No. 898 (the “Resolution”) amending regulations applicable to Brokers (or “ALyC” after its acronym in Spanish).

The Resolution was handed down in accordance with prior amendments in CNV General Resolution No. 731, which redefined the scope of the functions and activities of each ALyC category.

To facilitate oversight and supervision and obtain greater accuracy and clarity in the equity, economic, and financial information published by the ALyCs, the CNV limited the scope of the corporate purposes of applicable brokers so as to reduce operating risks unrelated to their intermediation functions and to protect the investing public.

The Resolution mandates, as a requirement for registration in the ALyC Registry, that the requesting legal entity’s stated corporate purpose be ALyC activities only, admitting as complementary activities only those subject to CNV oversight. Banks and Financial Institutions authorized to operate under the terms of Law No. 21,526 are exempted from the above-mentioned limitation.

Finally, the Resolution establishes requirements for agents already registered in the ALyC category at the time of the entry into force of its provisions, granting a 12-month compliance period to that end.