Brazilian SEC Proposes New Rules On Asset Management

The Brazilian Securities and Exchange Commission (in Portuguese, Comissão de Valores Mobiliários – CVM) ("CVM") is proposing for comments a draft regulation ("2014 Draft Regulation") to govern asset management-related services ("Services").

Currently, the Services are regulated by CVM Regulation 306, enacted in 1999, which needs to be improved to reflect the major developments the fund industry had in the last 15 years. Number of funds and assets managers grew impressively, and international players set new market standards, imposing new structures, pricing arrangements and variety of services.

In 2011, the CVM already proposed another draft regulation to regulate the Services, focusing mainly on the class of assets authorized to be managed by each asset manager, and general requirements by either an individual or a legal entity would have to comply with in order to perform the Services ("2011 Draft Regulation").