Brazilian Pension Plans Can Now Guarantee Investments in Infrastructure Projects

The Brazilian Monetary Council (Conselho Monetário Nacional – CMN) decided to amend the rules applied to Brazilian Pension Plans¹ to permit that they increase their exposure regarding investments in infrastructure projects. The new policy for investments of Pension Plans is established by CMN Resolution No. 3846, of March 25, 2010, which amended CMN Resolution No. 3792, of September 24, 2009 that sets for the applicable rules currently in force.

CMN Resolution 3792/2009 allows Pension Plans to invest up to 20% of their portfolio in instruments and securities issued by special purpose companies (Sociedade de Propósito Específico – SPE). The SPE must be formed to finance new projects (any types of projects, including infrastructure projects) for a fixed term of duration, and shall have its activities restricted to those provided for in the corporate purpose, as established and defined at the time of the incorporation. There are also allocation limits per issuer,