Why do democracies agree with contested illiberal regimes on the creation of regional institutions for election monitoring? This article tackles this puzzle by analyzing the creation of the Union of South American Nations' (UNASUR) Electoral Council (ECU) and its electoral "accompaniment" missions. The case of the ECU is particularly relevant, since its missions allowed for the legitimization of illiberal electoral practices in a region predominantly populated by democratic states that have pursued democracy consolidation through regional cooperation. We show that the emergence of the ECU resulted from the interaction of the following conditions: Venezuela's leadership; the mobilization of the transgovernmental network of South American electoral authorities; and the interaction between different sets of state preferences regarding election observation, which reached an equilibrium around an institutional design that did not impose a diminution of sovereignty on the contracting states. The article sheds light on the genesis of sovereignty-protective institutional designs, showing how they allow for the reconciliation of non-coincident preferences even in a sensitive field like election observation. The article also contributes to the literature on international election observation by explaining why democratic states may favor the emergence of monitoring mechanisms that contribute to the erosion of democracy in a region. In so doing, the article adds to the literature on regime-boosting regionalism, illuminating the conditions under which democratic regional organizations (ROs) create institutions that can boost illiberal regimes' legitimacy. In particular, our findings show that secondary powers, like Venezuela, can strategically exploit transgovernmental networks' mobilization to pursue their domestic and geopolitical interests (including illiberal ones) within ROs.