Regulations to promote access to financing through invoices and receipts for fees, and through purchase orders and/or services issued by state entities are approved in order to promote the productive and business development of micro, small and medium-sized companies (MSMEs) through financial leasing, for the regulation and supervision of the activity of participatory financial financing (investment crowdfunding), to promote the development of the capital financing market for dynamic and high-impact enterprises (startups), and to strengthen the technological services provided by the State to MSMEs, to establish new forms of participation in the shareholders’ meeting in a non-face manner, or with custodial representation, and on the offer of financial assets to the public, among other measures.- Emergency Decree No.013 -2020 (“DU 13-20”) approves various measures, mainly focused on promoting financing, some of which have an impact on the stock market.
The main measures are as follows:
o The FinPF is defined as the activity in which, through a platform (“Platform”), natural persons domiciled in the country or legal entities incorporated in the country, who apply for financing in their own name, called recipients, are contacted, with a plurality of individuals, legal entities or collective entities, called investors, who seek to obtain a financial return;
o FinPF is not considered to be the operation in which those who provide financing do not seek to obtain a financial return, or one that involves a single claimant with a single bidder of funds, or when the financing is carried out with the own resources of those companies that manage an electronic or digital communication medium;
o The modalities of FinPF that may be implemented through the platforms are: (i) FinPF through equity and/or debt securities, whose public offering is exclusively governed by the rules contained in DU 13-20, and the rules supplementing it; (ii) FinPF through loans, in which case the Superintendence of the Securities Market (“SMV”) may require the issuance of a financial instrument or other security, for which the SMV is empowered to create securities; and (iii) other securities established by the SMV.
o Regulation and supervision is primarily the responsibility of the administering entities of the Platforms, which must obtain authorization from the SMV and are supervised by the same SMV. Said entities are exclusive objects, capital and minimum equity. DU 13-20 empowers the SMV to require guarantees through regulations. Said legal mechanism also regulates the services that administrative entities may provide, their obligations and prohibitions. The SMV may authorize other entities already authorized by it to manage Platforms.
o The FinPF projects themselves, and the recipients of funds are not supervised by the SMV, yet that entity may determine the minimum information to be disclosed. The managing entities are responsible for ensuring that the projects comply with the rules set forth in DU 13-20. The securities that are issued do not require registration in the Public Registry of the Stock Market (“RPMV”). The DU 13-20 states that Indecopi is in any case responsible for knowing about violations of the Consumer Code and the Act on Repression of Unfair Competition.
o Regarding the FinPFs, the regulation mainly requires the following: (i) the recipients must apply for financing by their own behalf: (ii) the project must be carried out entirely in Peru, except for exceptions approved by the SMV; (iii) the funds may not be used to provide credits or loans; (iv) investors must have a financing objective; (v) projects should not be published on more than one Platform.
o The bank accounts into which the funds of the recipients or investors are channeled may not be affected by obligations of the management company or third parties.
o If the recipient is a public limited company and offers shares, this does not mean that it must be adapted to the open public limited company (“SAA”) form. If, as a result of the dispersion of shares generated by the issue of the shares, it incurs an adaptation to SAA, according to the General Companies Act Law No. 26887, it may request the SMV to exempt it from the obligation to register the shares in the RPMV.
o Recipients of funds must disseminate the information established by the SMV, that required by the Platform and as required by DU 13-20, including the dissemination of funds implementation. The responsibility for this information corresponds to the recipient of the funds, but the rule opens up the possibility that the administrator of the Platform may also be responsible. o The SMV approves the maximum fundraising limits per project and per year by the recipient, and the maximum number of fundraising requirements per year. The SMV may establish maximum limits to investors.
o A Capital Fund for Innovative Entrepreneurships is created, whose purpose is to invest in private or public funds dedicated to investing exclusively in entrepreneurial capital, particularly those with “dynamic and high impact”.
o The initial contribution to the fund is 70 million Soles, and its term is 30 years. It is managed by COFIDE as trustee, for which it shall sign a trust contract with the Ministry of Production. o The rule does not define the precise characteristics of such enterprises, which leaves a standard of development. However, it is established that as a general characteristic it must be “startups” with potential for rapid growth and expansion established and/or with operations in Peru and in the consolidation stage in the market.
o Supplementary rules regarding the strengthening of technological services provided by the State to MSMEs are provided.
o The rates of CAVALI S.A. I.C.L.V. (“CAVALI”) for services provided under Law No. 29623, Act that promotes financing through commercial invoices, are approved, reviewed annually and based on the marginal cost of the services offered.
o Freedom is extended to set interest rates, commissions and expenses, in accordance with article 9 of the Financial and Insurance System Act for: (i) FinPF operations; (ii) financing operations through mutual funds, trust funds and investment funds whose shares have been placed by public offering; and, (iii) other transactions determined by the SMV.
o Power to the SMV and the SBS to establish the temporary execution of any operation or activity through “innovative models”, and may set exceptions to the requirements provided for in the regulation.
o The text of article 2 of Law No. 30050, the Securities Market Promotion Act, “advertising of unsupervised financial assets and services”, is amended to emphasize that all advertising or notice on financial assets that is the responsibility of the SBS or of the SMV, in the national territory, may only be carried out by the one who is authorized to do so by the SMV or the SBS, as appropriate.
Among the novelties of the amendment is the reference that such acts could be carried out through the Internet even with servers located abroad (previously it only contemplated the use of servers located in the country). Another novelty consists in contemplating the power of said entities to apply a principle of primacy of reality to apply certain legal consequences beyond the name used for the financial asset.
Finally, the new text indicates that the entities in question must permanently alert the public to the performance of activities that are not permitted or prohibited.
o Issuers with securities registered in the RPMV are allowed to provide in their respective statutes, for the purposes of holding their general meeting: (i) for the calculation of the quorum, attendance and/or participation of shareholders by any written means, electronic, telematic or of another nature that guarantees their identity and, as appropriate, the identity of their accredited representative, as well as the opinion and shall expressed by the shareholders; and (ii) the possibility of establishing remote voting by electronic or postal means, establishing the requirements and formalities for its exercise.
The SMV has the power to adopt implementing regulations, being able to establish the compulsory nature of their application, as well as the facilities to be implemented for this purpose.
o The entities providing custody services to holders with securities registered in the RPMV may exercise their representation in general meetings and/or meeting of bondholders, without the need to grant powers. The SMV has the power to adopt implementing regulations regarding the above.
An exception of incompatibility is established to be qualified as an Independent Director in “Guidelines for the Qualification of Independent Directors” guidelines which are approved by SMV.- Through Resolution of SMV No. 003-2020-SMV/01, published on February 27, 2020 in the Official Gazette El Peruano, the criteria set forth in number 2.6 of subsection 2 of point VII are “specified”. Criteria to be qualified as Independent Director referred to in the “Guidelines for the Qualification of Independent Directors” and approved by Resolution SMV No. 016-2019-SMV/01.
The “precision” made by the mentioned resolution refers to the incompatibility, to be qualified as an Independent Director, for the purposes of preparing the “Report on Compliance with the Code of Good Corporate Governance for Peruvian Societies” (“Report”) , to be submitted by Peruvian companies with securities registered in the RPMV together with their annual report or Annual Information Document, consisting of the fact that a person may not be classified as an Independent Director by an issuer (“Issuer X”), if that person is at the same time Director or member of the Senior Management (as defined in said Guidelines) in another company (“Company Y”) where one of the Directors or members of the Senior Management of said Issuer X is part of the board of the Company Y, unless your qualification is that of Independent Director in said Company Y.
In this regard, the Resolution establishes that such incompatibility does not apply in case Issuer X and Company Y are part of the same economic group.
General Rules of the Stock Exchanges are approved.- Through Resolution of the Superintendent of the SMV No. 021-2020-SMV/02, published on February 19, 2020 in the Official Gazette el Peruano, the General Rules of the Stock Exchanges are approved, a set of rules governing various aspects that were previously only regulated at the LMV level and that are linked to obligations that correspond to these entities or that are subject to prior approval by the SMV. Among the main aspects, the aforementioned rules regulate the approval, amendment and dissemination regime of the fees charged by the stock exchanges, as well as its statute, internal regulations and supplementary provisions.The mentioned resolution also establishes sanctions related to the aspects it regulates.
The “Corporate Sustainability Report” which issuers must include in their annual report or annual information document is replaced.- Through Resolution of the Superintendent of the SMV No. 018-2020-SMV/02, published on February 8, 2020 in the Official Gazette el Peruano, replaces the Corporate Sustainability Report that issuers with securities registered in the Public Registry of the Stock Market, must submit together with their annual report or annual information document. The Resolution indicates that the new report follows the proposal for improvement presented by the Environmental, Social and Good Governance Working Group (ASG), constituted by the Capital Market Advisory Council, which is aligned with the results of the Diagnosis and Support Document for the Development of a Securities Market Roadmap for financing the corporate sector.
Unlike the previous report form, which requested a general disclosure in aspects such as corporate sustainability, impact on the environment, relationships with collaborators, with the communities, with which it interacts, and suppliers and customers, the new report form is more demanding in the disclosure of information in specific aspects such as existence in the issuer of management systems that include environmental commitments, conflicts or possible breaches of an environmental nature, Greenhouse Gas emissions, water footprint, quality control of effluents, energy consumption, solid waste, risks and opportunities in relation to interest groups, criteria for purchasing or selecting suppliers, labor policy, procedures to identify and sanction sexual harassment and work hostility, among others.
Supplementary Provisions to the Regulations of Operations on the Stock Market to include new foreign securities in the table of referential securities - TVR. are amended- Through Resolution of SMV No. 002-2020-SMV/01, published on January 29, 2020 in the Official Gazette el Peruano, the Supplementary Provisions to articles 21 and 27 of the Regulations of Operations in the Lima Stock Exchange listing, approved by CONASEV Resolution No. 021-99-EF/94.10, are amended to include in the Table of Reference Securities – TVR, a greater number of foreign securities that are considered to have the conditions that make them susceptible to being subject to securities reporting and securities lending.
To this end, the TVR calculation methodology is amended to include the shares, securities representing share rights and ETFs listed in the New York Stock Exchange, Nasdaq Stock Market or Toronto Stock Exchange, which have been registered in the Transferable Securities Registry of the Lima Stock Exchange and in the RPMV at the request of said stock exchange or of Promoters. However, it is made clear that these securities are not eligible for short sales.
The Asset Securitization Process Regulations regarding the requirements and procedures for registering securities are amended. – Through Resolution of the Superintendent of the SMV No. 006-2020-SMV/02, published on January 17, 2020 in the Official Gazette El Peruano, Articles 44, 48 and 50 of the Asset Securitization Processes Regulations are replaced, relating to the requirements and procedure for the registration of securities issued in the framework of said processes, either individually, or through programs. Most of the changes made to the text of these articles are less relevant details. Among the main changes related to the individual registration of securities are those related to the characteristics of the financial information to be presented regarding trusts, the type of entity that may issue the risk classification of the securities for which said classification is compulsory, and the applicable deadlines in the registration procedure. In addition, with respect to the registration of securities through programs, the main changes consist of the period in which the registration of the program shall be in force, the periods applicable to the registration procedure, and the need to submit supplementary acts, except in the case of a Securitization Trust for Investment in Real Estate Income – FIBRA.
Maximum CAVALI fees are approved for registering bills of exchange in its accounting record.- Through Resolution of Superintendent of SMV No. 003-2020-SMV/02, published on January 14, 2020 in the Official Gazette el Peruano, the maximum fees that CAVALI shall charge for the bill of exchange registration service for issuers with an issuer account at CAVALI are approved, and for participants; and by dematerialization of bills of exchange, only for participants; referred to in Chapter III “Issuers and Securities” of the CAVALI Internal Regulations. As we know, by provision of the Securities Market Act, the fees charged by CAVALI must be approved by the SMV.
Brokers’ Regulation regarding the settlement regime of brokers with revoked authorization.- Through Resolution of the Superintendent of the SMV No. 005-2020-SMV/02, published on January 12, 2020 in the Official Gazette El Peruano, Article 166 of the Brokers’ Regulation is amended and approved by SMV Resolution No. 034-2015-SMV/01, to allow a broker whose operating authorization has been revoked by the SMV, and therefore must enter a liquidation procedure, in accordance with the provisions of said regulations, may request the SMV to appoint the liquidator. The general regime under which the SMV may appoint the liquidator directly is maintained and shall be developed in a separate standard, as established by the approved amendment.
