On November 14, 2024, General Resolution No. 1030/2024 (the “Resolution”) of the Argentine Securities Commission (the “CNV”) was published. Such Resolution introduced significant changes in the regime applicable to the public offering of Argentine Certificates of Deposit (“CEDEARs”) and investment funds related to assets issued abroad.
Changes in the public offering of foreign underlying assets
It was provided that any public offering, whether of:
– CEDEARs or any other instruments representing investment funds, including ETFs.
– Negotiable securities issued by entities incorporated or registered abroad.
The raising of money or securities in Argentina for investment portfolios must be made exclusively through Mutual Funds (FCI).
Specific rules for CEDEARs representing ETFs
The rules permit the public offering of CEDEARs representing ETFs, provided they meet the following conditions:
1. Passive index replication: ETFs must passively replicate widely distributed indexes reflecting equity assets (equities), virtual assets and commodities.
2. Liquidity index: The underlying ETFs must have a liquidity index equal to or greater than that of the MERVAL index.
3. Proof of passive nature: The issuer must submit documentation detailing the composition of the replicated index. It will also have to demonstrate that the fund’s operating conditions and performance are exclusively designed to replicate the index in a passive manner.
For CEDEARs programs already authorized that are linked to actively managed funds that replicate indexes, a transitional regime was established. The purpose of this regime is to guarantee legal certainty to the issuers involved and to protect the investments made under the regulatory framework in force prior to the resolution.
