- That the listing of a security in one exchange will be approved automatically in the other exchanges. This means that any issuer listed for example in the BVL will be automatically listed in the other exchanges;
- Each listed company is subject only to the regulation existing in the country were the securities were first listed (which may allow certain kind regulatory arbitrage). Therefore, the reporting and disclosure obligations applicable to such issuer will be only the ones applicable in the exchange of origin;
- Broker agents will be able to place order in the different stock exchanges involved through agreements entered into with broker agents authorized in the corresponding stock exchange. Accordingly, if a Peruvian investor is willing to acquire shares of a Chilean company listed in the BCS, can file an order with its own Peruvian agent, which will be able to file the order directly in the BCS thanks to an agreement with a broker agent authorized in the BCS.
- In this first stage only company shares and other equity securities (except for derivatives) will be traded via MILA.
Details on MILA
In October, 2010 the Securities Commission of Peru, Conasev, passed a resolution regarding the Creation of Integrated Markets. This resolution is one more step for the integration of the three stock markets: the Bolsa de Valores de Lima, BVL, the Bolsa de Comercio de Santiago, BCS, and the Bolsa de Valores de Colombia, BVC.
The resolution also works to organize the integration of the settlement and compensation institutions: Cavali in Peru, Depósito Central de Valores de Chile, and the Depósito Centralizado de Valores de Colombia.
Each security market will maintain its independence and autonomy, allowing companies to issue and place listed shares in the three countries according to its corresponding regulations (issuers must comply with regulations in each market it intends to raise capital).
In order for an investor to trade securities in another exchange member of the MILA (different to its own local exchange), the person must contact a local broker who has entered into an agreement with an agent authorized to operate in such foreign exchange.
The integrated market will expand the ability of issuers to obtain resources in medium and long term, as long as they will have access to a broader list of potential investors. The companies can access to a better funding sources, quickly and efficiently, because the countries involved are characterized by securities offerings related to different types of business.
Indeed, BVL is known for a wide range of securities related to mining, BVC, for companies related to hydrocarbons and the banking sector, and the BCS is a leader in energy sector issues, retail and other services. Therefore, the markets integration is a fundamental stage for an investor looking for diversification.