New resolution for funds should expand diversification and increase investment abroad, says CVM president

(CVM Disclosure)

SAO PAULO – The modernization of the rules for investment funds, under way at the Brazilian Securities and Exchange Commission (CVM), will have diversification among its important points, and in several aspects – either opening more possibilities for investments through the funds, or increasing the public, with expanded access to products, or for more openness to investments via funds abroad. The information was given by Marcelo Barbosa, who participated in one of the panels at the Anbima Summit, on Wednesday (27).

The new resolution is expected to be published in the first half of next year. According to Barbosa, the public hearing dealing with the new rules is the largest held so far by the CVM, with more than 90 manifestations.

“In addition to this hearing, which is quite complex and laborious, we have others on our agenda to be concluded. We hope that at some point in the first half of next year the regulation will already be published. We are going to work so that it is closer to the beginning of the year”, he said.

For Barbosa, the revision of the fund’s rules has an important mark of clarification, greater transparency and security. “We are trying, through this hearing, to equate important historical issues that now, due to a recent legal change (Economic Freedom Law), allows us to address the liability of shareholders limited to the value of their shares, the issue of the separation of shares in different classes and the responsibility between service providers”, he said.

Regarding the fund’s responsibility divided between manager and administrator, the president of CVM highlighted that the entity is, in a way, recognizing what the practice already enshrines, in addition to dividing the role between these two main service providers. “The hiring can be done by the manager or the administrator, depending on the relationship of the service with the attributions of one or the other”, he said. According to the wording of the draft of the hearing, in some situations the responsibility of the manager and the administrator can be joint and several.

Investment abroad

Barbosa recalled that efforts had already been made in recent years to expand the possibility of investments abroad for various types of assets. “We are allowing retail funds to invest up to 100% of their equity abroad, subject to certain requirements. Funds that invest in BDRs may disregard this product as investment abroad”, he explains. The intention, with this measure, is to progressively increase investment possibilities outside the country.

Currently, funds aimed at retail investors can invest up to 20% of their equity in international assets. However, these investors are not restricted when buying BDRs (Brazilian Depositary Receipts) directly.

Barbosa also commented on the creation of the socio-environmental FIDC (Receivables Investment Fund), a demand from investors of various types, from retail, who also show interest in the ESG agenda, to large international investors, who have revised their policies . “We are not going to create prescriptive rules to say which credits will enter this portfolio. We are not going to regulate the certifiers. We are saying that the structurers of this type of fund must use a recognized taxonomy that can be compared to other products”, he explained.

The CVM president believes that the Fiagros (Investment Funds in Agro-industrial Productive Chains) will play a prominent role in the future. For him, there is demand for this market with the agribusiness chain. “We chose to do something innovative and, right after the law was enacted, we brought the resolution to deal with the registration”, he said. There are three categories: investing in real estate, receivables or equity. “In the first few weeks, we registered 15 Fiagros. Now, we have to bring a broader rule that deals with the product”, he concluded.

(With information from Anbima)

About Yadunandan Singh

Born in 1992, Yadunandan approaches the world of video games thanks to two sacred monsters like Diablo and above all Sonic, strictly in the Sega Saturn version. Ranging between consoles and PCs, he is particularly fond of platform titles and RPGs, not disdaining all other genres and moving in the constant search for the perfect balance between narration and interactivity.

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