On August 30, the National Securities Commission (CNV) regulated through General Resolution 806/2019, changes to the periods of the operations of Common Investment Funds (FCI) (incorporated by Decree 596/2019). The CNV established that physical persons who invested in FCIs with short-term public securities that are covered by the measure will have the same right as physical persons who invested directly in these assets. The resolution is in force as of today and covers representative short-term national public debt securities called LETES, LECAPS and LECER.
For investors who are physical persons and who hold shares in FCIs whose portfolios are made up of the public debt securities mentioned above, the regulations outline the guidelines to be implemented as part of the portfolio management.
The CNV ruled that the active entities of the open FCIs whose portfolios as of August 28, 2019 included representative short-term national public debt securities, may:
- Group the assets that make up the portfolios of these funds according to their liquidity and/or type of quota share and segregate the holdings corresponding to the physical persons who were quota share holders as of July 31, 2019, through suitable procedures or instruments that ensure the rights of the quota share holders with respect to the assets.
- With the liquid assets that make up the portfolios, payment will be made in proportion to the holdings of each party. Redemption fees, deductible from the amount redeemed, will be applied only to these assets.
- FCIs that wish to use this mechanism must inform the CNV within 48 hours of the decision and submit the minutes of the board of directors of both bodies accrediting the approval of this decision.
Meanwhile, the active entities of the aforementioned FCIs must submit the following information to the CNV and Caja de Valores S.A., as a sworn statement:
- Payroll of physical investors who were in the status of quota share holders as of July 31, 2019 and whose status had been preserved as of August 28, 2019, with the detail of the number of quotas held by each for each common investment fund.
- Data relating to the client account of each of the common investment funds.