BUENOS AIRES, Nov 29 (Reuters) - Argentina’s Senate passed a law on Thursday to reform the country’s capital markets, giving the state more power to regulate financial deals.
President Cristina Fernandez backed the bill, which was passed by the lower house last week. The Senate voted 43 to 19 to approve the measure.
The reform will give the securities regulator, the CNV, the power to oversee the country’s financial markets, supervised by market entities before. The CNV will now be charged with regulating share listings and public companies.
It will also continue exercising its authority to approve public offers.
Although Argentina is Latin America’s No. 3 economy, its capital markets are small partly due to strict capital and currency controls, as well as high inflation.
“It is essential that we put an end to the self-regulation,” ruling-party Senator Anibal Fernandez, who previously served as the president’s cabinet chief, said during the debate.
Government officials say the reform aims to attract more investment from companies and individuals to bolster the country’s capital markets and expand financing options for corporations.
It loosens requirements for operating in the market and simplifies corporate debt authorizations, eliminating the requirement that issues be vetted by ratings agencies - which Argentina accuses of being in cahoots with speculators.
Argentina is listed as a frontier market by equity index provider MSCI and it could have that status stripped if the government continues intervening in the markets. In May, it seized control of energy company YPF from Spain’s Repsol, causing a diplomatic row.