BRAZIL Law and Practice Contributed by: Guilherme Bueno Malouf, Luciana Costa Engelberg, Bruna Marrara and Thales Saito, Machado Meyer Advogados
FIPs may have classes of quotas with different economic and/or political rights, subject to the applicable regulation. Under CVM Resolution 175, assets can be segregated into different classes of quotas. Asset-Backed Securities Funds (FIDCs) FIDCs may be organised as open-ended or closed-ended condominiums. Annex II of CVM Resolution 175 consolidated the rules applica - ble to FIDCs and FIDC-NP (non-standard asset- backed securities funds) into a single regulation. CVM Resolution 175 allows non-qualified inves - tors (retail) to subscribe/acquire senior quotas of the standard FIDCs, provided that certain requirements are complied with. The subscrip - tion of quotas of a FIDC that allows investment in non-standard receivables is restricted to profes - sional investors. FIDCs may invest in receivables such as credit rights and underlying instruments originating from transactions in the financial, commercial, industrial, real estate, mortgage, leasing and ser - vice segments. A FIDC that allows investment in non-standard receivables may also invest in receivables such as litigated claims, government bonds and overdue receivables. FIDCs may have different subclasses of quotas (senior and subordinated). Senior quotas have priority in the amortisation and redemption of quotas, while the other classes of quotas are subordinated to the senior quotas for amortisation and redemp - tion. Per Resolution CVM 175, other economic and political rights may be attributed to FIDCs’ subclasses of quotas. Real Estate Funds (FIIs) FIIs are organised in the form of closed-ended condominiums and are invested in real estate developments. FIIs may target general investors (retail) or qualified investors.
Quotas of FIIs may be divided into series, with the specific purpose of establishing different dates for the payment of the quotas by the hold - ers of each series of quotas. Quotas targeting qualified investors may be divided into differ - ent subclasses with certain limitations. Different classes with different economic and political rights and segregation of assets are also avail - able for FIIs. Agriculture Investment Funds (FIAGROs) Introduced by Law No 14,430, FIAGROs are funds that invest in the Brazilian agribusiness sector, which includes rural real estate and other assets related to the agro-industrial productive chain, such as equity interests, financial assets, credit rights, credit instruments, securitisation instruments, quotas of funds, and other securi - ties. The expansion of agribusiness participation in the capital market was a key focus of the Regu - latory Agenda, which also aimed to promote a more sustainable market. In September 2024, the promulgation of CVM Deliberation 214 add - ed Annex Normative VI to CVM Deliberation 175, introducing specific rules for investment funds involved in agro-industrial production chains. The resolution also allows the acquisition of carbon credits and decarbonisation Credits – CBIOS (a title issued and tradable by biofuel producers) as a new asset class for this fund’s portfolio. In this context, the recent Law No 15,042 of 11 December 2024 has created the regulated Brazilian carbon market to encourage the reduction of greenhouse gases and mitigate climate change. CVM also assigned the fund’s manager the responsibility to acquire environmental assets according to reliable certifications, in line with
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