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BALANCES AND TRANSACTIONS WITH COMPANIES UNDER SECTION 33 - LAW No. 19,550 AND RELATED PARTIES | 12 Months Ended
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Dec. 31, 2023
BALANCES AND TRANSACTIONS WITH COMPANIES UNDER SECTION 33 - LAW No. 19,550 AND RELATED PARTIES |
BALANCES AND TRANSACTIONS WITH COMPANIES UNDER SECTION 33 - LAW No. 19,550 AND RELATED PARTIES | NOTE 27 - BALANCES AND TRANSACTIONS WITH COMPANIES UNDER SECTION 33 - LAW No. 19,550 AND RELATED PARTIES ​ a) Controlling Company As of December 31, 2022 CVH was the controlling company of Telecom Argentina, holding directly and indirectly (thought VLG) 28.16% of the capital stock of the Company. Additionally, both VLG (controlled by CVH) and Fintech, contributed to the Voting Trust, in accordance with the Shareholders´ Agreement (see below “Voting trust pursuant to the Shareholders’ Agreement between Fintech and CVH”), shares representing 10.92% of the capital of the Company so the shares subject to such agreement represent 21.84% of the total capital of the Company (the “Shares in Trust”). On April 28, 2023, the Ordinary and Extraordinary General Shareholders’ Meeting held, the shareholders of CVH approved the corporate reorganization process through the merger by absorption of VLG and the Pre-Merger Commitment. The Definitive Merger Commitment was executed by public deed dated June 5, 2023. On September 1, 2023, IGJ proceeded to register in its Public Registry the merger by absorption of VLG and its dissolution without liquidation with effect from January 1, 2023. Consequently, as of December 31, 2023, as a result of the corporate reorganization process, CVH directly owns 28.16% of the Company’s share capital. Shareholders’ Agreement: Fintech - CVH On July 7, 2017 CVH, VLG (merged to date with CVH), Fintech Media LLC (merged to date with Fintech), Fintech Advisory Inc., GC Dominio S.A. (all of them direct or indirect shareholders of Cablevisión S.A.) and Fintech (direct or indirect shareholder of Telecom Argentina) entered into a shareholders’ agreement that governs the exercise of their rights as shareholders of the Company. The Shareholders´ Agreement establishes basically:
| ● | the representation in the corporate bodies, provided that subject to the fulfillment of certain conditions and as long as CVH holds a certain percentage of Telecom Shares, CVH shall be entitled to designate the majority of the directors, members of the Executive Committee, Audit Committee, Supervisory Committee, CEO and any other Key Employee (other than the CFO and the Internal Auditor). CVH shall also be entitled to nominate the Chairman of the Board of Directors and Fintech to nominate de Vice chairman of the Board of Directors.
| ● | a scheme of supermajorities and required votes for the approval by the Shareholders´ Meetings or Board of Directors´ Meetings, respectively, of certain matters such as: i) the approval of the Business Plan and the Annual Budget of Telecom Argentina; ii) amendments of the bylaws, iii) changes in Independent Auditors, iv) the creation of committees of the Board of Directors, v) hiring of Key Employees as defined in the Shareholders´ Agreement (Key employees will be proposed by CVH, except for the CFO and the internal auditor); vi) merger of Telecom or any other controlled entity, vii) acquisitions of certain assets, viii) sale of certain assets, ix) capital increases; x) incurrence of indebtedness over certain limits, xi) capital investments not contemplated in the Business Plan and the Annual Budget above certain amounts; xii) related party transactions, xiii) contracts that may impose restrictions to the distribution of dividends; xiv) new lines of business or discontinuing existing lines of business; xv) contracting for significant amounts not contemplated in the Business Plan and the Annual Budget, among others.
Voting trust pursuant to the Shareholders’ Agreement between Fintech and CVH In accordance with the Shareholders´ Agreement, on April 15, 2019, a Voting Trust Agreement (the “Trust Agreement”) was regularized, under which Fintech and VLG (i) each contributed with 235,177,350 shares of Telecom in a voting trust (the “Voting Trust”) which, when added to the shares that CVH holds (directly and indirectly) in Telecom, exceed fifty percent (50)% of the outstanding shares, and (ii) CVH and Fintech each appointed a co-trustee. The shares contributed to the Voting Trust will be voted by the co-trustee of CVH in accordance with the vote of CVH or following the instructions of CVH, except in respect of certain matters subject to veto under the Shareholders´ Agreement, in which case will be voted by the co-trustee of Fintech in accordance with the vote of Fintech or following the instructions of Fintech. b) Balances with Companies under section 33 - Law No. 19,550 and Related Parties
● | Companies under section 33 - Law No. 19,550 – Associates and Joint Venture
​
​ | ​ | ​ | ​ | ​ | ​ | ​
CURRENT ASSETS | ​ | Kind of related party | ​ | As of December 31,
Trade receivables |  | ​ |  | 2023 |  | 2022
Ver TV | ​ | Associate | ​ | 10 | ​ | 2
OPH | ​ | Joint venture | ​ | 27 | ​ | —
​ | ​ | ​ | ​ | 37 | ​ | 2
Other receivables | ​ | ​ | ​ | ​ | ​ | ​
La Capital Cable | ​ | Associate | ​ | 210 | ​ | 1,046
Ver TV | ​ | Associate | ​ | 2 | ​ | 6
​ | ​ | ​ | ​ | 212 | ​ | 1,052
CURRENT LIABILITIES | ​ | ​ | ​ |  | ​ |
Trade payables | ​ | ​ | ​ | ​ | ​ | ​
La Capital Cable | ​ | Associate | ​ | 3 | ​ | —
TSMA | ​ | Associate | ​ | 1 | ​ | 3
OPH | ​ | Joint venture | ​ | 1,071 | ​ | —
​ | ​ | ​ | ​ | 1,075 | ​ | 3
Other liabilities | ​ | ​ | ​ | ​ | ​ | ​
OPH | ​ | Joint venture | ​ | 2,358 | ​ | —
​ | ​ | ​ | ​ | 2,358 | ​ | —
NON - CURRENT LIABILITIES | ​ | ​ | ​ | ​ | ​ | ​
Other liabilities | ​ | ​ | ​ | ​ | ​ | ​
OPH | ​ | Joint venture | ​ | 4,133 | ​ | —
​ | ​ | ​ | ​ | 4,133 | ​ | —
​ ●Related parties ​
​ | ​ | ​ | ​ | ​
CURRENT ASSETS | ​ | As of December 31,
Trade receivables |  | 2023 |  | 2022
Other related parties | ​ | 656 | ​ | 699
​ | ​ | 656 | ​ | 699
Other receivables | ​ | ​ | ​ | ​
Other related parties | ​ | 4 | ​ | 12
​ | ​ | 4 | ​ | 12
CURRENT LIABILITIES | ​ | ​ | ​ | ​
Trade payables | ​ | ​ | ​ | ​
Other Related parties | ​ | 4,587 | ​ | 6,185
​ | ​ | 4,587 | ​ | 6,185
​ c) Transactions with Companies under section 33 - Law No. 19,550 and related parties ●Companies under section 33 - Law No. 19,550– Associates and Joint venture ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Transaction | ​ | Kind of related party | ​ | Years ended December 31,
​ |  | ​ |  | ​ |  | 2023 |  | 2022 |  | 2021
​ | ​ | ​ | ​ | ​ | ​ | Profit (loss)
​ | ​ | ​ | ​ | ​ | ​ | Revenues
La Capital Cable | ​ | Services revenues and other revenues | ​ | Associate | ​ | 102 |  | 218 |  | 280
Ver TV | ​ | Services revenues and other revenues | ​ | Associate | ​ | 33 | ​ | — | ​ | 37
OPH | ​ | Services revenues and other revenues | ​ | Joint venture | ​ | 84 |  | — |  | —
​ | ​ | ​ | ​ | ​ | ​ | 219 | ​ | 218 | ​ | 317
​ | ​ | ​ | ​ | ​ | ​ | Operating costs
La Capital Cable | ​ | Fees for services | ​ | Associate | ​ | (870) |  | (554) |  | (545)
​ | ​ | ​ | ​ | ​ | ​ | (870) |  | (554) |  | (545)
​
● | Related Parties
​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Transaction | ​ | Years ended December 31,
​ |  | ​ |  | 2023 |  | 2022 |  | 2021
​ | ​ | ​ | ​ | Profit (loss)
​ | ​ | ​ | ​ | Revenues
Other Related parties | ​ | Services and advertising revenues | ​ | 1,974 |  | 1,548 |  | 1,921
​ | ​ | ​ | ​ | 1,974 |  | 1,548 |  | 1,921
​ | ​ | ​ | ​ | Operating costs
Other Related parties | ​ | Programming costs | ​ | (17,783) |  | (21,727) |  | (25,641)
Other Related parties | ​ | Editing and distribution of magazines | ​ | (2,727) |  | (3,846) |  | (5,169)
Other Related parties | ​ | Advisory services | ​ | (2,306) |  | (2,778) |  | (3,207)
Other Related parties | ​ | Advertising purchases | ​ | (1,464) |  | (2,258) |  | (3,385)
Other Related parties | ​ | Other purchases and commissions | ​ | (1,119) |  | (956) |  | (1,171)
​ | ​ | ​ | ​ | (25,399) |  | (31,565) |  | (38,573)
​ The transactions discussed above were made on terms no less favorable to Telecom than would have been obtained from unaffiliated third parties. When Telecom’s transactions represented more than 1% of its total shareholders’ equity, they were approved according to Law No. 26,831, the Bylaws and the Executive Committees’ Faculties and Performance Regulation. d) Key Managers Compensation for Directors for technical-administrative functions and Key Managers includes fixed and variable compensation, retention plans, social security contribution, and, in some cases, accrued severance compensation. Compensation for Directors and Key Managers of Telecom Argentina for the years ended December 31, 2023, 2022 and 2021 amounted to $5,898 million, $2,775 million and $1,184 million, respectively (in currency of the transaction date), and were recorded as expenses under the line item “Employee benefits expenses and severance payments”. As of December 31, 2023, an amount of $3,167 million remained unpaid. Telecom Argentina has recorded a provision of $765 million, $435 million and $418 million for the fees of its Board of Directors’ members for the year ended December 31, 2023, 2022 and 2021, respectively (in currency of the transaction date). As of December 31,2023, there are no unpaid balances. The members and alternate members of the Board of Directors do not hold executive positions in the Company or Company’s subsidiaries.

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