CHILE Law and Practice Contributed by: Felipe Díaz Toro, Victor Riadi and Ignacio Ruiz Rodríguez, EDN Abogados
investors. There are no specific investor protec - tion provisions regarding alternative investment funds or restrictions other than those mentioned in 2.3.1 Regulatory Regime . 2.3.11 Approach of the Regulator Under Chilean law, any public entity may be the subject of a request for contact or a meeting with its officials, through compliance with cur - rent administrative regulations. Generally, the fund manager is responsible for approaching the CMF regarding any existing or newly created investment funds. Pursuant to NCG No 314 of the CMF, fund managers must engage with the CMF through a web portal known as SEIL. To contact a public service such as the CMF under Chile’s Lobbying Law 20.730, a regulated and transparent process must be followed. Ini - tially, a request for a hearing or meeting must be submitted, detailing the purpose and top - ics of the interaction. The public entity (in this instance the CMF) will review the request and, upon approval, schedule the meeting. All inter - actions are documented and published on the Lobby Law website, ensuring transparency and public access to information. Despite the highly regulated communica - tion channels, the CMF is approachable, even through face-to-face meetings, provided all rules applicable to lobbying are fulfilled in accordance with the provisions set forth in Law No 20.730 and its Rules contained in Decree No 71 of 2014. 2.4 Operational Requirements Investment funds targeting alternative assets must comply with specific restrictions set forth in Article 57 of the LUF.
• As previously mentioned, alternative invest - ment funds cannot directly engage in activi - ties or own assets traditionally considered within the scope of alternative investments, such as developing agribusiness facilities, building grid infrastructure, owning com - mercial real estate or holding mining conces - sions. • When the nature of said alternative assets permits custody, the fund manager is obliged to protect them through the appointment of a depository company regulated by the CMF and registered in the Central Securities Depository. There are specific requirements regarding investments in assets located in different jurisdictions and the custody held by foreign entities. • There are no specific requirements regard - ing investment limits, borrowing, anti-money laundering (AML) or further regulatory meas - ures solely in consideration of the alterna - tive nature of the invested assets. Pursuant to Article 59 of the LUF and NCG 376, fund managers must ensure that funds comply with specific investment and borrowing provi - sions, which are particularly important for mutual funds targeting retail (non-qualified) investors. In addition, fund managers must continually provide the CMF with updated manuals containing all risk assessment and mitigation protocols in accordance with the risks inherent to all funds under manage - ment and the fund manager itself, in accord - ance with the recently issued NCG No 507 of the CMF. This regulation imposes specific risk assessment requirements regarding the investment cycle of the fund, including both subscription and redemption cycles and its accounting practices. The fulfilment of the risk management require - ments established in NCG No 235 of the CMF
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