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What are the relevant statutes and which government authorities are responsible for investigating and enforcing them?

In Argentina, securities activities mainly fall under Capital Markets Law No. 26,831, as amended (CML) and Decree No. 471/2018 (the CML Decree), to the extent that those activities involve a public offering.

The CML has federal scope. There are no equivalent regulations at the local level (as opposed to ‘blue sky laws’ at the state level in the United States) and the supervising authority is the Argentine Securities Commission (CNV).

The CNV is a public body with power to regulate the public offering of securities; enforce the provisions of the CML, the CML Decree and other complementary regulations; and accordingly impose administrative sanctions, for which an internal proceeding subject to certain rules must be followed. It is, thus, the main securities enforcement authority in Argentina with broad powers over securities markets and their participants.

With less participation since the CML was enacted, institutional markets where securities are traded have some minor authority over market participants, with powers to suspend or stop securities trading, disqualify participants or report to the CNV any action that may violate current regulations.

Within the spectrum of criminal offences, Law No. 26,733 incorporated into the National Criminal Code (NCC) several economic and financial criminal offences, including activities related to the capital markets and transactions with securities. These criminal behaviours are subject to sanctions ranging from imprisonment to statutory disqualifications. Such sanctions must be applied by courts with jurisdiction in criminal matters and all charges must be brought by the Public Prosecutor’s Office (PPO).

Main securities regulations

The main securities regulations in Argentina include the following:

  • the CML, as amended by Productive Financing Law No. 27,440;
  • Private Securities Purchase Law No. 20,643;
  • National Securities Commission Law No. 22,169, as amended;
  • Negotiable Securities Law No. 23,576, as amended;
  • the Civil and Commercial Code;
  • CNV regulations, mainly General Resolution No. 622/2013 as amended and supplemented;
  • the NCC; and
  • the rules governing the listing of securities and derivatives issued by stock exchanges (Bolsas y Mercados Argentinos; Mercado Abierto Electrónico; Matba Rofex; and Mercado Argentino de Valores).

Enforcement authority

The CNV is an autonomous public entity within the federal executive branch that operates under the Ministry of Finance, which acts as the enforcement authority of the CML at the federal level. Since the enactment of the CML on 27 December 2012 (and its amendments), the CNV has centralised surveillance, regulatory and enforcement powers, which had been traditionally shared with stock exchanges. This makes the CNV the main securities enforcement authority at the federal level, with the power to conduct investigative proceedings into market participants and act as an administrative judge at the same time. Pursuant to the rule-making powers and authority granted to it by the CML, the CNV may broadly regulate activities with securities, impose a wide range of obligations on capital market participants and bring administrative investigations against persons or entities that may have violated the CLM or the CNV regulations (or both) and sanction them accordingly.

One of the CNV’s main securities enforcement areas is the Inspections and Investigations Division, under which four different subdivisions work closely to surveil and investigate non-authorised behaviours. These divisions are the Inspections Subdivision, the Investigations Subdivision, the Analysis Subdivision and the Market Monitoring Subdivision.

The Administrative Investigations Division, on the other hand, is the department responsible for bringing and conducting investigative proceedings and advising the CNV’s board of directors on sanctions to capital market participants, and even filing criminal complaints with the courts or participating as a plaintiff in criminal proceedings.

Jurisdiction of the CNV

The CNV’s jurisdiction is limited to activities that involve public offerings of securities in the Argentine territory, covering the activities of key participants in the securities industry and the capital markets, including issuers of securities (i.e., public companies), securities brokers and dealers, clearing houses, securities exchanges, trusts and mutual funds.

The definition of ‘securities’ in the CML is extremely broad. It includes credit securities, shares, shares of common investment funds, debt securities and participation in collective investment vehicles, and, in general, any homogeneous and fungible security or investment contract or credit rights, issued or grouped in series, that are subject to generalised and impersonal traffic in the financial markets. Also included within this concept are, among others, futures contracts, options and derivatives that can be registered with the CNV, deferred payment checks, certificates of deposit and warrants, promissory notes, bills of exchange, mortgage bills, and securities that are subject to secondary trading in markets.

For an activity to fall within the scope of the CML and the CNV rules, securities must be publicly offered. A public offer is construed by the CML as an invitation extended to persons in general or to specific sectors or groups to transact with securities, through personal offers; journalistic publications; radio-telephone; telephone or television transmissions; film projections; placement of posters or signs; programmes; electronic media, including the use of email and social networks; circulars and printed communications; or any other means of dissemination.

Pursuant to Productive Financing Law No. 27,440, the CNV is allowed to issue regulations for cases in which a securities offering should not be deemed as involving a public offering but a private one. However, to date, neither the CML nor the CNV regulations provide for such exemptions or for safe harbours, such as those found in US securities law. Whenever a transaction with securities is conducted within the framework of the public offering definition, that transaction is governed by the CML and falls under the scope of the CNV.

Securities issued by the Argentine state, provinces, the city of Buenos Aires, municipalities and autarchic entities do not require CNV authorisation. Public offerings subject to the provisions of the CML regulate marketing activities by individuals and private entities.

Under Section 19 of the CML, the CNV has broad powers to monitor, inspect and sanction all individuals or entities that, for whatever reason, carry out activities related to the public offering of negotiable securities, other instruments, operations and activities falling within the scope of the CML. It also has the power to require markets and clearing houses to exercise supervisory and oversight functions and carry out inspections in relation to their participating members.

What conduct is most commonly the subject of securities enforcement?

Under the CML and the CNV regulations, the following activities are deemed non-transparent and are therefore subject to CNV sanctioning:

  • Insider trading: individuals are restricted from using confidential or privileged information to which they have access through their jobs, professions or functions as capital market participants (including issuers, agents, public officials, markets and even members of the CNV) for their own benefit or that of third parties.
  • Manipulation and deception: market participants, including issuers, registered agents, and investors, must refrain from engaging in behaviours that manipulate or enable manipulation of prices or volumes of securities, altering the normal course of supply and demand, as well as any other type of deceptive practice or behaviour that may mislead any market participant, including, for example, making false or inaccurate statements.
  • Ban on authorised participation in the public offering of securities: all persons are banned from intervening or rendering services in connection with the public offering of securities without prior CNV authorisation (this includes, for example, unregistered brokerage or unauthorised issuance of securities).

Other behaviours punishable by the CML and the CNV regulations include: misleading advertisements or other forms of dissemination that may mislead or confuse the public (Section 112, CML); intentional or grossly negligent dissemination of false information (Section 116, CML); violation of duties to preserve confidential information (Section 102, CML); and breaches by different participants of the duty to inform and breaches of the obligations imposed on external auditors (Section 108(g), CML).

All these activities, as well as generally breaching any obligations imposed by the CNV on capital market participants (e.g., accounting requirements, formalities for documents offered to the public, reporting obligations towards the CNV and markets, and compliance authorisation procedures) are subject to the administrative sanctions provided in Section 132 of the CML.

The statute of limitations on CML breaches is six years, starting the moment of the breach.

In addition to administrative fines and sanctions, individuals and legal entities may face criminal sanctions and civil liability claims.

Administrative sanctioning procedure

Sanctioning procedures may be initiated both sua sponte or on account of an individual complaint, which may be anonymous. Private complainants cannot, under any circumstances, participate as parties to the proceeding. Finally, sanctions are enforced by the CNV’s board of directors following an administrative investigation proceeding by one or more CNV divisions.

Both at the investigation stage and in the subsequent stages of administrative proceedings, if a criminal action is presumed, the CNV may bring a complaint to a criminal court or file a suspected transaction report (STR) with the Financial Information Unit.

The investigation and criminal prosecution of individuals or entities for any behaviours punishable under the CML does not preclude the conduction and conclusion of CNV administrative proceedings.

Preliminary investigation

A preliminary investigation is the first step to determining whether securities regulations have been violated. The Investigations Subdivision is responsible for collecting information about the transaction and the participants at the investigational stage of the proceeding. Evidence at this stage may result from market surveillance, investor tips and complaints, media reports and information provided by other CNV divisions. Investigations are deemed classified and may not be accessed by third parties.

Preliminary investigations may conclude with the complaint being dismissed, participants being issued a warning, a formal investigation proceeding being requested or an STR being issued in accordance with the provisions of Anti-Money Laundering Law No. 25,246.

Likewise, both during preliminary investigations and at the administrative investigation stage, the CNV may request that the courts authorise raids and other coercive measures (such as requests for assistance in the enforcement of its decisions or the appointment of intervening authorities, among others), without the need for a prior hearing or the affected party being able to appeal the decision.

Administrative investigation

Once the preliminary investigation stage has been completed and a proposal for furthering the investigation has been formalised, the CNV’s board of directors may order the opening of a formal administrative investigation. Prosecution of administrative investigations is overseen by the Administrative Investigations Division of the CNV.

Decisions adopted by the CNV during the course of preliminary investigations and administrative proceedings are non-appealable but may be challenged on appeal of a final decision by the CNV’s board of directors.

Any CNV board resolution opening administrative proceedings must specify the charges against the individuals or legal entities in question, set a date for the mandatory preliminary hearing provided for in Section 138, Paragraph 2 of the CML, and appoint the persons who will be in charge of conducting the investigation as well as all other intervening professionals. Currently, preliminary hearings can be conducted remotely by videoconference.

At the preliminary hearing, the accused parties may be requested to provide their testimony and discuss factual matters. If the facts are admitted, and charges and liability are accepted, the CNV may conclude the investigation proceedings and hand down a final resolution. This is known as an ‘abbreviated procedure’ and is only available for minor faults as of September 2021.

If the matter is not resolved at the preliminary hearing, the decision may be made to open an evidentiary stage, unless there are no controversial facts to be demonstrated.

Upon opening the evidentiary stage, the officer appointed as the leading investigator may set deadlines and hearings, request documentary evidence, depose witnesses, summon experts and consultants, and ensure any other necessary means to complete the evidence. Notifications of decisions may be served at special addresses or electronic addresses.

Once evidence has been collected, and after the defendants have filed a statement appraising the facts and charges within an established period of time, a final filing is submitted by the Administrative Investigations Division to the board of directors for consideration.

Conclusion of proceedings

Proceedings must be concluded with the adoption of a well-founded resolution by the CNV’s board of directors, which must be notified to the defendants. Such resolutions may include dropping charges, declaring the matter moot, declaring the action extinguished or applying one or more sanctions under Section 132 of the CML. Final resolutions, as well as resolutions that open proceedings and order criminal complaints, are published on the CNV’s website (

What legal issues commonly arise in enforcement investigations?

Throughout the investigation stage, defendants have the right to attorneys and legal representation, to recuse the intervening officials, to refrain from appearing in the investigation, to access the file, to submit evidence, to call ordinary and expert witnesses to the stand, and to submit writings and statements, among other things.

As in administrative proceedings conducted before administrative judges, the principles of informality, due process, speed, simplicity and economy govern. In addition, everything that has been done in the hearings must be transcribed for the purpose of its review on appeal.

The main defences usually put forward are that the disciplinary action is time-barred, that the CNV’s administrative actions are null and void, that the transactions or activities in question resulted in no specific damage, and that the double-jeopardy principle or other constitutional rights have been violated.

The CNV does not have a whistleblower programme and there is no regulation providing monetary incentives to individuals who report violations to the CML. From a criminal perspective, in contrast to other criminal conduct provided for in Law No. 27,304, individuals suspected of securities crimes are not allowed to enter into collaboration agreements with the prosecution to have their penalties reduced. In addition, it is not guaranteed that legal entities will have their penalties reduced or avoid administrative liability if they spontaneously report these types of offences.

What remedies and sanctions are available to government authorities?

Applicable sanctions

Sanctions under Section 132 of the CML that the CNV can apply after an investigation include:

  • warnings;
  • a fine of between 100,000 Argentine pesos and 1 billion Argentine pesos, which may be raised to half of the benefit obtained or the damage caused;
  • disqualification of up to five years to perform management and auditing functions;
  • suspension of up to two years to make a public offer or operate within the public offering regime; and
  • preclusion from making public offers of securities or, where appropriate, withdrawal of the authorisation to publicly offer securities.

Additionally, the CML establishes that any person who operates in a market, in violation of their duties, is responsible for the damage caused to other persons who have contemporaneously traded the securities in question. This compensation may not exceed the actual price difference obtained or the avoided loss in the transaction or transactions subject to the violation, provided that no criminal conduct has taken place.

Penalty scales must take into consideration: the magnitude of the violation; the benefits generated or the damage caused by the participant; the volume traded by the violating party; and the individual liability of the management and supervisory bodies and their controlling relation within the corporate group, and, in particular, whether such members are independent or external.

In the case of legal entities, directors, administrators, trustees or members of the supervisory board and, when appropriate, managers and members of the qualification board, are jointly and severally liable with the legal entity if found personally liable for the violation.

Other sanctions that the CNV may impose include voiding corporate acts from an administrative perspective, suspending or revoking registrations and authorisations or even stopping the public offer of negotiable securities or operations in situations of risk.

Appealing CNV decisions

Sanctions imposed by the CNV can be appealed and may be taken to the federal courts of appeal with jurisdiction in commercial matters, within 10 days of notification. In these cases, the CNV is party to the judicial proceeding and the PPO acts as prosecutor.

Criminal enforcement procedures and punishments

From a criminal law perspective, Argentina has had a sound legal framework since the incorporation of criminal securities-related offences into the NCC under Law No. 26,733. However, convictions for these types of crimes have so far been rare. Even when unauthorised public offering of securities is one of the most commonly investigated and punished offences by the CNV, there are no firm convictions under Section 310 of the NCC to date.

Federal courts and public bodies

In addition to administrative liability within the scope of the CNV, individuals can be held criminally liable for several offences in connection with securities. These include federal offences such as insider trading, manipulation of financial markets and making misleading offers, unauthorised financial intermediation, financial fraud and financial bribery.

Prosecution and enforcement of punishments for criminal offences in connection with securities are overseen by the federal courts in criminal and correctional matters at the federal level, together with the economic criminal courts and economic criminal courts of appeal in the city of Buenos Aires (also with federal authority).

Under the National Code of Criminal Procedure (NCCP), federal and national judges have broad powers, including to request the intervention of national and local police forces, communicate with other judges from different jurisdictions (even to get overseas judiciary cooperation), addressing administrative authorities and requesting their cooperation, and ordering procedural and precautionary measures aimed at avoiding and preventing obstructions to investigations.

In criminal proceedings, the PPO is the public body responsible for urging public criminal action at the federal level under Section 5 of the NCCP. Within this body, one relevant institution is the Prosecutor’s Office for Economic Crime and Money Laundering (PROCELAC), which plays a leading role in prosecuting and investigating economic crimes, in particular those with institutional relevance and a socio-economic impact.

Pursuant to Resolution No. 914/2012 of the Argentine Attorney General, the PROCELAC may intervene as the principal or adjuvant prosecutor in matters under its jurisdiction, lead investigations, receive criminal accusations and, if deemed necessary, refer them to the appropriate prosecutors, among others.

Within the PROCELAC, the Financial Fraud and Capital Markets Department plays a key role in coordinating tasks among the different prosecutors’ offices with jurisdiction over financial market cases and to follow up the proceedings that involve facts related to these matters. It may also arrange inter-institutional cooperation and actions with specialised agencies to improve investigations and prosecutions in cases involving the national financial markets. To that effect, the PROCELAC has agreed with the CNV to exchange information about judicial and administrative proceedings involving securities.

Securities-related crimes

The legal framework for punishing securities crimes is set forth in Sections 307 to 313 of the NCC.

Insider trading

Under Section 307 of the NCC, directors, members of supervisory bodies, shareholders or their representatives and anyone who provides or uses privileged information, to which they have access due their position within an issuer, to market, purchase, sell or liquidate securities is subject to one to four years’ imprisonment, a fine equivalent to the amount of the transaction, and a special disqualification of up to five years.

Moreover, pursuant to Section 308 of the NCC, a minimum term of one year’s imprisonment is increased to two to six years when such actions are carried out on a regular basis or the perpetrator or a third party benefited from the action or avoided an economic damage. The maximum term is raised to eight years when a severe damage to the securities market is caused or when the offence is carried out by a director, member of the supervisory body, officer or employee of a market or risk rating agency, or when an activity requiring registration is performed, or when the offender is a public official. In these cases, a special disqualification of up to eight years may also apply.

Market manipulation

Under Section 309, Subparagraph 1(a) of the NCC, individuals performing transactions or operations that raise, maintain or lower the price of securities or other financial instruments via false information, unreal negotiations, meetings or coalitions among the main holders of securities, with the purpose of creating the appearance of greater liquidity, or for trading them at a fixed price, are subject to one to four years’ imprisonment, a fine equivalent to the amount of the transaction and disqualification of up to five years.

Misleading offering of securities

Under Section 309, Subparagraph 1(b) of the NCC, the same imprisonment penalty for manipulation activities applies to individuals offering securities or financial instruments, misrepresenting or concealing true facts or circumstances, or stating or implying false facts or circumstances.

False communication about the company’s financial situation

Under Section 309, Subparagraph 2 of the NCC, representatives, administrators or controllers of companies with private controlling bodies who hide or falsify important facts or information from shareholders or partners in connection with the economic situation of a company, or include false or incomplete data on balance sheets, annual reports or other accounting documents, are subject to two to six years’ imprisonment.

Unauthorised raising of public savings in the securities markets and unauthorised brokerage of securities

Under Section 310 of the NCC, individuals raising savings from the public in the stock market or rendering brokerage services for the acquisition of negotiable securities without authorisation from competent authorities are subject to one to four years’ imprisonment, a fine equivalent to two to eight times the value of the operations carried out and a special disqualification of up to six years. The minimum penalty increases to two years’ imprisonment when journalistic publications, radio or television broadcasts, internet posts, film projections, placement of posters, signs or banners, programmes, circulars and printed communications or any other procedure of mass dissemination are used.

False registration of financial operations

Under Section 311 of the NCC, employees and officers operating in the securities market who, by providing false data or mentioning false information, document an active or passive credit operation or securities negotiation with the intention of obtaining a benefit for themselves or for third parties or causing damage are subject to one to four years’ imprisonment, a fine equivalent to two to six times the value of the operations and disqualification of up to six years. The same penalty applies to anyone who fails to record any such operation.

Bribery in the financial sector

Under Section 312 of the NCC, employees of entities operating in the stock exchange are subject to one to two years’ imprisonment and special disqualification of up to six years for receiving money or benefits in exchange for financing loans or stock exchange transactions, whether received personally or through an intermediary.

Other criminal offences include the certification and authorisation of false balance sheets and other financial reports (Section 300 NCC) and financial sector fraud (Sections 172 to 175 NCC).

Individuals and entities subject to criminal prosecution

Criminal offences under Articles 307 to 312 of the NCC are, in principle, applicable to individuals. However, when such offences are conducted on behalf of, or with the intervention of or for the benefit of a legal entity, that legal entity may be subject to penalties ranging from a fine equivalent to two to 10 times the value of the goods served by the criminals, suspension of activities for up to 10 years, suspension of participation in public bidding processes, and cancellation and loss of public benefits, among other things.

If the entity is under the public offering regime, penalties apply in consideration of shareholders or holders of securities with no participation in the criminal behaviour.

Criminal proceedings

Securities crimes are not subject to particular proceedings and are instead conducted in accordance with the general provisions of the NCCP. Likewise, such criminal actions must be initiated sua sponte, since they do not depend on a private action, and must be prosecuted by PPO agents, including PROCELAC members.

This procedure usually begins with the filing of a complaint by an injured party, witness or other person who has knowledge of the crime. The CML authorises the CNV to report crimes or to become a plaintiff, which has been the case on numerous occasions.

Once a complaint is filed, a criminal investigation is initiated at the request of a member of the PPO, under which the circumstances of the alleged violations, the participants and the extent of the damage, among others, are investigated to determine whether there are sufficient elements for a criminal conviction. If so, defendants are summoned by the judge to give an investigative statement. This step is prior to, and necessary for, the trial phase to commence.


1 Juan M Diehl Moreno and Sergio Tálamo are partners at Marval O’Farrell Mairal. The authors would like to thank Ezequiel Guerrero, an associate at Marval O’Farrell Mairal, for his help with the regulatory aspects of the chapter.

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