New Criminal Sanctions Applicable To Some Financial And Stock Market Activities

Author:Mr Francisco Abeal, Patricia S. Lopez Aufranc, Clara Vela and Gustavo L. Morales Oliver
Profession:Marval O'Farrell & Mairal
 
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Laws No. 26,733 and 26,734, published in the Official Gazette on December 28, 2011, were passed by Argentine Congress to impose criminal sanctions applicable to terrorist financing, insider trading, stock market manipulation and unauthorized financial and stock market activities. Both laws introduce amendments to the Argentine Criminal Code.

  1. Terrorist Financing

    The new Section 306 of the Argentine Criminal Code, as amended by Law No. 26,734, establishes a criminal penalty –imprisonment and fine– on the person who collects goods or funds, either directly or indirectly, with the intention or knowing that such goods or funds will be used to finance crime or will be used by a criminal organization or an individual who commits crimes or participates in crimes, and such crimes are aimed at terrorizing the population or at forcing federal authorities or foreign governments or agents of an international organization to do or to refrain from doing something.

    The Financial Information Unit (UIF) will be in charge of the analysis, use and communication of information for prevention of crimes committed with the abovementioned purpose. Federal Courts will have jurisdiction over those crimes.

    The criminal penalties established by Section 306 shall be applied irrespective of whether (i) the crime for which the financing is intended has been actually committed and (ii) the goods or funds provided were actually used to commit such crime. Section 306 shall also apply when the financed crime occurs outside of Argentina or when the individual or the organization committing the crime is located abroad, provided that the financed crime is penalized in the jurisdiction competent to judge over said crime.

  2. Insider Trading

    New Section 77 of the Argentine Criminal Code, as amended by Law No. 26,733, establishes that privileged information shall include all information that is not made available to the public, the disclosure of which could have a material impact on the stock market.

    Section 307, introduced by Law No. 26,733, sets forth criminal penalties –imprisonment, fine and special disqualification– applicable to directors, members of supervisory bodies, shareholders, shareholder's representatives and whoever by means of his/her job, profession or position at an issuing company, either directly or through an intermediary, provides or uses privileged information to which he/she had access as a result of his/her activities, for the negotiation, pricing...

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