Fintech Regulation Guide

Does your jurisdiction regulate Fintech services under the traditional Financial Services laws or does it have any ad hoc regulatory frameworks for fintech services? (Financial Services Laws/Ad Hoc Framework/Hybrid)

There is not any formal comprehensive law for fintech companies. The Central Bank of Argentina (BCRA) is empowered to regulate all payment systems, clearing and settlement houses, money remittance entities and cash-in-transit companies, and to carry out any other action related to the financial and foreign exchange sectors. The BCRA also regulates some fintech verticals, such as Payment Service Providers (PSPs), Non-Financial Credit Providers (NFCPs) and Peer-to-Peer Credit Service Providers through Platforms (PPCSPs). Law 27,349 and Resolutions 717/17 and 942/22 of the National Securities Commission (CNV), the local SEC, regulate crowdfunding platforms. Law 25,246 (AML) establishes that PSPs, NFCPs, crowdfunding platforms, virtual asset service providers, among others, are obliged subjects before the Financial Information Unit (UIF). Law 27,743 created a moratorium regime for the regularization of domestic and foreign assets, to which taxpayers having undeclared assets may adhere. Crypto-currencies, crypto-assets and other similar assets may be subject to it.

Make a list of fintech services that may obtain a licence in your jurisdiction

Fintech companies do not require any license to operate, unless they perform financial intermediation, operate in foreign exchange or fall under Law 27,349 (crowdfunding platforms). However, they must register with the BCRA if they carry out the following activities: 1) PSPs that perform the functions of “account provision”, “acceptance”, “initiation”, “ATM networks”, “electronic funds transfer networks (processing or operation)”, “acquiring entity”, “aggregation or subacquiring entity”, “non-banking collection of taxes and/or services” or provide digital wallet service; 2) NFCPs; and 3) PPCSPs. Likewise, Virtual Asset Service Providers (VASPs) must register in the Registry of Virtual Asset Service Providers of the CNV. PSPs, NFCPs, crowdfunding platforms, virtual asset service providers, among others, are obliged subjects before the UIF.

What is(are) the name(s) of the regulatory authority(ies) responsible to grant licences and regulate fintech service providers? If there is more than one, please list which fintech services are regulated by which authority.

The BCRA regulates digital banks, PSPs, NFCPs and PPCSPs. The CNV regulates crowdfunding platforms under Law 27,349 (crowdfunding platforms) and is in charge of the Registry of Virtual Asset Service Providers. The UIF is in charge of preventing money laundering, financing of terrorism, financing the proliferation of weapons of mass destruction and complex economic-financial crimes. PSPs, NFCPs, crowdfunding platforms, virtual asset service providers, among others, are obliged subjects before the UIF.

Are there any specific restrictions on the types of fintech services that can be offered in and/or from your jurisdiction?

Fintech companies must not do financial intermediation; otherwise, they shall apply for a banking license before the BCRA. Financial entities and PSPs that offer payment accounts may not operate or facilitate their clients to operate with digital assets (including crypto-assets and assets which yields are determined by the variations of crypto-assets) unless authorized by BCRA, or the corresponding regulator. ICO may require prior registration and approval by CNV if they qualify as a public offering of a security.

Is reverse solicitation allowed in your jurisdiction, for fintech firms licensed in other reputable jurisdictions? (Meaning that a third-country fintech firm can offer services to clients in your jurisdiction providing its at the exclusive initiative of the client).

Reverse solicitation is not regulated in Argentina.

Are there any specific requirements for companies providing fintech services in your jurisdiction?

There are specific requirements for registered fintech companies including “Know your customer” (KYC), AML prevention, data privacy, fair trade and consumer protection, and several administrative reporting regimes. Some of these requirements may also apply to non-fintech companies.

Are there any specific consumer protection measures that apply to fintech services in your jurisdiction?

There is an obligation to disclose transparent and accurate information with easily understandable information on restrictions and fees, along with fair contractual terms and a complaints’ handling procedure. Advertising guidelines includes provision of balanced information and usage of plain language. Additionally, firms must disclose key information, such as fees and risks, to enable consumers to take informed decisions. This information must be in a visible place and in letters of prominent size.

Are there any other legal issues that companies should be aware of when providing fintech services in your jurisdiction?

Yes, such companies should be aware of laws and regulations regarding consumer protection rights, fair trade, unfair business practices, digital and electronic signature, foreign exchange controls, tax and AML, as well as civil and commercial procedural rules and case law for the enforcement of electronic contracts and forensic evidence recollection.

Are virtual assets (such as cryptocurrencies and) permitted in your jurisdiction? (Yes/No)

Yes

If the answer is Yes, is there any licensing /authorization/notification process that needs to be followed for a person to issue a new virtual asset? (Yes/No)

Yes

If the answer is Yes, please provide a summary of the process that needs to be followed by a person to issue a new virtual asset).

Virtual Asset Service Providers (VASPs) must register in the Registry of Virtual Asset Service Providers of the CNV. If the crypto asset qualifies in any way as a security (e.g. a token), the issuer should register before the CNV and request the authorization to make a public offer of the security.

Are Virtual Asset service providers regulated in your jurisdiction? (Yes/No)

Yes.

If the answer to your previous question is Yes, please provide a summary of the framework that regulates such service providers explaining which licence(s) need to be obtained from which authority(ies).

Virtual Asset Service Providers do not require a license. But they need to register in the Registry of Virtual Asset Service Providers of the CNV before they can start to operate.

Are you as a firm providing services and advice relating to Virtual Assets? (Yes/No)

Yes.

Please feel free to add any pertinent comments in addition to your answers.

Rule 4614/19 (federal tax agency): those who manage, control or process asset movements in electronic or digital management platforms, on behalf of human and legal persons, including PSPs that offer payment accounts, must report thereto the list of clients and the balance of their accounts.

Crypto-assets are taxed as follows: income generated and obtained out of transactions made with own or third-party cryptocurrencies (Income Tax); holding of crypto-assets (personal property tax).