Taxand Argentina discusses the easing of due diligence measures in their anti-money laundering and tax newsletter.
Following the processes to ease investments, on 13 January 2017, the AML agency (the UIF) and the Federal Tax Authority (the AFIP) issued resolutions No. 4/2017 and 3986/2017-E to simplify the requirements for opening special investment accounts (the Accounts) for foreign investors.
In this sense, the UIF details the minimum requirements that must be requested when opening the Accounts, among which is the need to verify that the supervising agency of the foreign investor has entered into a memorandum of understanding with the Argentine Securities and Exchange Commission and/or the Argentine Central Bank.
In addition the UIF Resolution regulates financial legally bound reporting parties due diligence obligations. In this regard, it is established that for the opening of Accounts requested by brokers, the local financial entity must only perform the due diligence on the broker, being the broker that has to carry out the due diligence of its own clients (irrespective of the financial entities’ obligations to monitor and supervise with a risk-based approach).
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The AFIP has simplified the process by establishing that prior to opening the Accounts, the foreign investor must request a “code for foreign investors”, and when obtaining said code, the legally bound reporting party shall act as its representative.
