Argentina Securities Commission approves first local ETF regime and updates CEDEAR and CEVA rules

The Argentina Securities Commission approved final rules creating Argentina's first local ETF regime through FCI ETFs and CEVA ETPs, while also revising the framework for CEDEAR and CEVA public offerings. The measures follow public consultation and allow locally regulated products to replicate stock market or financial reference indices or baskets of assets, adding a new locally traded diversification option for investors. The framework sets custody requirements, accounting and operational segregation of underlying assets, transparent price formation, and daily disclosure of relevant information. It bars FCI ETFs and CEVA ETPs from investing in or being constituted by units of other FCI ETFs, CEVA ETPs or CEDEARs, and adds instrument-specific rules on securities lending, the creation and cancellation of CEVA units, and the subscription and redemption of FCI units to facilitate arbitrage between market prices and underlying asset values. Once issued, both CEVA and FCI fund units may trade on the secondary market, and both instruments may be digitally represented. Separately, the updated CEDEAR and CEVA regime introduces automatic authorization for increases in size and term changes in existing issuances, adjusts requirements for trustees and management companies, removes local liquidity barriers affecting the underlying assets of ETF CEDEARs, and strengthens prospectus disclosures on the legal nature of CEVA, counterparty risk and replication mechanisms.