23 Jul 26 Primary Placements of Securities

Agustín Cerolini, Martín Chindamo,Valentina Circolone and Tomas Mingrone

By means of Resolution No. 1,157 (hereinafter, the «Resolution«), the National Securities Commission (hereinafter, the «CNV«, by its acronym in Spanish) has submitted for public consultation a proposal to amend the regulatory framework governing primary placements of securities, with the aim of strengthening transparency, the management of conflicts of interest and investor protection. Comments may be submitted through the CNV’s website within 15 business days.

Participants and allocation rules.

The proposal introduces the following definitions: (i) “Participating Agent”, meaning any clearing and settlement agent or negotiation agent that submits orders or expressions of interest on behalf of third parties or for its proprietary account; (ii) “Participating Parties”, meaning all individuals or legal entities participating in the primary placement; (iii) “Placement Agents”, meaning the clearing and settlement agents and/or negotiation agents appointed to act as placement agents for the negotiable securities; and (iv) “Lead Placement Agent”, meaning the placement agent responsible for maintaining the order book and issuing the final allocation instruction.

It also requires the final prospectus, prospectus supplement or offering document to identify the persons responsible for determining the price, interest rate, internal rate of return (the “IRR”), yield or any other cut-off variable, describe the allocation criteria and the procedure for receiving orders, and specify the opening and closing times of the public auction or tender.

Limitations on proprietary orders.

Placement Agents may not submit orders for their proprietary portfolios in an amount exceeding the difference between their total net worth and the applicable minimum regulatory net worth requirement.

In auctions or tenders, proprietary orders submitted by Placement Agents must be entered no later than 45 minutes before the closing time. In book-building processes, such orders will be conditional upon insufficient third-party demand and may not displace other investors.

CNV supervision and reporting.

Markets must provide the CNV with direct, permanent and real-time access to their primary placement systems, including orders, amendments, cancellations, allocations and the identification of participants.

In addition, notices of results must be published on the same day as the closing and must include a summary table broken down by type of allotted investor and by the agent that submitted the order. Agents must enter orders into the system within 30 minutes of receipt.

Fees and commissions.

The proposal prohibits Placement Agents from charging investors any commissions or additional fees for participating in the placement.

Partners Agustín Cerolini and Martín Chindamo, and Valentina Circolone and Tomas Mingrone.