On October 15, 2024, the National Securities Commission (“CNV”) approved General Resolution 1024 (the “Resolution”), which introduces a special accounting information regime for the so-called “entities subject to privatization”. The purpose of this regime is to facilitate their integration to the public offering system, adapting to the particularities of these entities and to the regulations in force in the capital market.
The new framework seeks to simplify the transition process, allowing companies to comply with the eligibility requirements necessary to participate in the market and offer their shares publicly.
The regime establishes a two-year adaptation period, during which entities will be required to submit simplified accounting information in the form of interim financial statements. At the end of this period, companies will be required to present their complete financial statements in accordance with International Financial Reporting Standards (“IFRS”).
In those cases where privatized entities do not have audited financial statements, a special reporting scheme will be implemented. This will require the presentation of a simplified financial summary that allows an assessment of the economic situation and associated risks, accompanied by a description of the limitations faced and the method used to prepare the information. In addition, companies will be required to submit a detailed plan to correct these deficiencies within a maximum period of two years from their entry into the regime.
This approach seeks to provide flexibility to companies in the process of privatization, allowing them a progressive incorporation to the market while ensuring the necessary transparency for investors.
The following entities are eligible for this special regime:
1. Companies subject to privatization under the Law of Bases and Starting Points for the Freedom of Argentines.
2. Entities subject to privatization under the State Reform Law (Law 23,696).
3. Companies declared as “subject to privatization”.
4. Trust Funds made up entirely or mainly of assets and/or resources of the National State.
Entities applying for this regime must comply with the regulations established by the CNV from the moment of their application, gradually adapting to the standards of the applicable public offering regime.
