On August 30, 2016, the Brazilian Securities Exchange Commission
(Comissão de Valores Mobiliários –
"CVM") issued two new sets of rules relating to private
equity funds, (called Fundos de Investimento em
Participações or "FIPs" in Portuguese).
Instruction 578, creates new rules regarding the formation,
management, and operation of FIPs. Instruction 579 addresses the
preparation of the financial statements of FIPs and outlines the
accounting criteria for the recognition, classification, and
measurement of assets and liabilities.
Instruction 578 is the result of discussions between CVM and
Brazilian private equity funds and aims to improve the former
Instruction 391, which is now no longer in effect. According to
Antonio Berwanger, CVM's commissioner overseeing market
development, "the public hearing process permitted a broad
debate with industry participants which brought important changes
to the final wording of the regulations, which are now closer to
international
