The Argentine National Securities Commission (CNV) has introduced a groundbreaking financial system called PIC FAL. This initiative aims to modernize the local labor market by ensuring that severance pay and voluntary retirement funds are securely managed and guaranteed, providing unprecedented legal certainty for workers and financial predictability for businesses across the country.

A New Paradigm for Employment Security

Within a framework of economic stabilization, the National Government is promoting the Labor Modernization Law No. 27,802 and Decree No. 408/2026. These tools are designed to reduce legal disputes and professionalize how labor savings are managed in Argentina.

Effective Date:
November 1, 2026

What are PIC FALs?

The Collective Investment Products for Labor Assistance Funds (PIC FAL) are specialized financial vehicles created specifically to fund severance packages or voluntary retirements.

Unlike a traditional company fund, these are non-redeemable by the employer. This means the money is legally locked and available exclusively for the employee, acting as a safety net.

Context for foreigners: In Argentina, severance payments (indemnizaciones) can be a source of significant legal conflict. A PIC is similar to a Mutual Fund where capital is managed by professionals to generate returns while remaining segregated from the company's general assets.

Employer Contributions

The system mandates a monthly contribution that employers must transfer to ARCA (formerly known as AFIP, the national tax agency):

🏢 Large Companies 1% of total payroll
🏪 SMEs (PyMEs) 2.5% of total payroll

Administrative & Technical Framework

Permitted Structure Administrators Maximum Cost Transparency
FCIA FAL (Mutual Funds) / FF FAL (Trusts) Banks and ALyCs (Broker-dealers) 1% annually of assets Monthly FAL Report on performance

To ensure organization, an ID FAL (a unique code) will link each company to its specific fund. If an employer fails to choose an administrator, the CNV will assign one based on a transparent, chronological list.

Investment Policy: Where is the money kept?

To prevent excessive risk and ensure liquidity, the CNV has strictly defined the eligible assets. The capital will be invested in:

Public Securities and Sub-sovereign bonds.
Corporate Bonds (ON) with Triple AAA ratings.
Financial Deposits and UVA inflation-linked fixed terms.
What comes next?

For the system to be fully operational, final resolutions from ARCA and regulations from the Secretary of Labor are expected. These will define the exact payroll period from which contributions will begin.

Source: El Cronista →