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CVM launches public hearing on investment fund rule


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This post was translated by Regulatory.News for informational purposes only; the content below is not an official translation from the regulator. See the content in its original language here.

Objective is to modernize the regulation of funds, based on the Economic Freedom Act

The Securities and Exchange Commission (CVM) starts today, 1/12, public hearing to change the regulations on the constitution, operation and disclosure of investment fund information, in addition to the provision of services for the funds. Several proposed innovations are based on the Economic Freedom Law (Law 13,874 / 19).

The draft resolution that is placed at the hearing also begins, with regard to the funds, the review and consolidation that the CVM is promoting for all its rules, pursuant to Decree 10.139 / 19. Given the opportunity, the Minute covers two items of the CVM Regulatory Agenda for 2020, which would be treated separately:

  • the modernization of the general norm for investment funds (CVM Instruction 555), including, among other changes, the innovations brought by the Economic Freedom Act; and
  • the modernization of the Credit Rights Investment Funds (FIDC) standard, currently regulated by CVM Instruction 356.

The CVM seeks to reflect progress towards fundamental objectives, such as the efficient functioning of the market and the reduction of compliance costs for its participants, without disregarding investor protection, which is a fundamental mandate of the Autarchy.

“Our objective was to present a proposal that represents an effective modernization of the regulatory framework for investment funds, covering many matters, in a systematic way and adhering to the spirit of the law. We also seek to make improvements permitted by the Economic Freedom Act. We now look forward to the opportunity to reflect on the contributions to be received at the public hearing stage. ”

Marcelo Barbosa, President of CVM

The Economic Freedom Law brought new possibilities for the regulation of investment funds, with the following highlights:

  • limiting the liability of each shareholder to the value of their shares;
  • provision that the liability of service providers may be limited to their own acts or omissions;
  • possibility for investment funds to have quota classes with different rights and obligations and with segregated assets for each class; and
  • application of the civil insolvency institute to investment funds.

“The possibility of setting up segregated assets within the same fund through different classes of shares offers new opportunities for structuring products and reducing costs for the investment fund industry in Brazil.”

Antonio Berwanger, Market Development Superintendent

Other changes suggested in the regulatory framework

Minuta also proposes changes that are convenient and opportune in the current scenario of the Brazilian fund industry, such as the expansion of investment possibilities abroad and the establishment of exposure limits to capital risk for Equity, Foreign Exchange Investment Funds, Multimarket and Fixed Income.

Regarding Financial Investment Funds, FIFs, we can highlight the possibility that, once certain requirements are met, funds destined for the general public will invest even their entire assets in financial assets abroad. ”

Daniel Maeda, Institutional Investor Relations Superintendent.

The topography of the standard also changes. The Draft consists of a main section, which contains general rules, applicable to all investment funds, and two annexes, in which the specificities of FIF (Annex I) and FIDC (Annex II) are treated. Other annexes will be added as the consolidation of standards progresses.

Minuta also brings news specifically related to FIDC, such as:

  • general public access to FIDC quotas, observing some characteristics of the fund;
  • greater clarity in the separation of responsibilities between the fund’s service providers, with a significant reduction in the custodian’s duties;
  • mandatory registration of credit rights in a registration entity authorized by the Central Bank;
  • manager’s responsibility for structuring the fund, hiring a specialized consultant, as well as verifying the guarantee of credit rights and eligibility criteria; and
  • extinction of “Non-Standardized” FIDC, currently provided for in CVM Instruction 444, and the creation of “non-standardized” credit rights, subject to target audience restriction.

ESG Agenda was also part of the proposal

THE ASG agenda there was also space in the proposal. Governance has been improved through electronic communications and virtual meetings. In addition, the possibility of labeling an FIDC as “Socioenvironmental” is a new step for the Brazilian market to become more competitive in attracting capital aimed at a sustainable and low carbon economy.

“It seems reasonable to expect that the demand from socio-environmental FIDCs will heat up the supply of ‘green’ receivables and debt securities, in a healthy process for the development of this market segment in Brazil.”

Claudio Maes, Standards Development Manager


The categories of funds not yet covered in the Draft – notably Real Estate Investment Funds (FII) and Equity Investment Funds (FIP) – will be inserted throughout the work of reviewing and consolidating the normative acts promoted by CVM in compliance with the Decree 10.139 / 19.

Although the proposal submitted to the public hearing does not deal with the matter, the CVM is working, in a separate study, on the modernization of the FIF information system, with a view to making it more efficient, less costly and with information considered more useful for investors.

Sending statements and suggestions

Participate in the Public Hearing by sending your considerations up to 2/4/2021 to email [email protected]r.

More information

The new public hearing addresses two items of the CVM Regulatory Agenda 2020.

Access the Public Hearing SDM 08/20.

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Regulator Information

Abbreviation: CVM
Jurisdiction: Brazil

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