Dentons on Global X’s first Fixed Income ETF in Colombia
Dentons Cárdenas & Cárdenas has advised Global X in the legal structuring of the first Fixed Income ETF in Colombia that will invest in Colombian government bonds (TES Class B) in order to obtain investment results comparable to the J.P. Morgan GBI-EM Colombia Government Local Currency Index.
The ETF, called GXTESCOL, will be traded on the Colombian Stock Exchange (BVC) and Global X will act as professional manager, while the fund manager will be Fiduciaria Bogotá and J.P. Morgan will provide the benchmark index.
The launch of the ETF on 20 March 2024 is a real milestone in the Colombian capital market, as it will allow, for the first time in history, investors to acquire Colombian public debt securities with minimum values of approximately 15 dollars, which will boost the Colombian capital market. It is worth noting that the ETF started with a TES issue by the Colombian Ministry of Finance and Public Credit for approximately $50 million.
The advisory involved the entire legal structuring of the ETF, including the preparation of the regulations and contracts between the different actors involved, as well as highly specialised financial regulatory advice, overcoming significant legal challenges due to the novelty of the product.
Dentons’ team consisted of partner Pablo Jaramillo (pictured), and associates Antonio Rojas Mayol, Rodrigo José De Vivero and Sofía García-Reyes.
