The Securities and Exchange Commission of Brazil (CVM) enacted temporary and experimental provisions that enable the constitution of Agribusiness Investment Funds (FIAGROs), which were established by Law n. 14.130/2021. They are designed to invest in rural land acquisition, agribusiness activities, agribusiness financial assets, and credit rights.
Resolution n. 39/2021 from the Securities and Exchange Commission of Brazil (CVM) enacted temporary and experimental provisions that enable the constitution of Agribusiness Investment Funds (FIAGROs), established through Law n. 14.130/2021 (reported in the 22nd edition of the Regulatory Report). They are provided as closed-end or open-end co-property ventures, designed to invest in rural land acquisition, agribusiness activities, agribusiness financial assets, and credit rights. They represent new sources of financing for the agribusiness sector, intended to foster its development.
As detailed in the new resolution’s considerations, the establishment of a new CVM regulatory framework to oversee the newly provided funds will not be achieved in 2021, hence, the commission established temporary and experimental provisions that enable their constitution. The new resolution determined that the new funds may only be constituted as one of the three FIAGRO modalities provided in its second article, which are based on already existing fund modalities, each one adhering to a specific CVM regulatory framework:
- “FIAGRO-Direitos Creditórios”, which adheres to the regulatory framework of Receivable Investment Funds (FIDCs, in the Portuguese acronym);
- “FIAGRO-Imobiliário”, which adheres to the regulatory framework of Real Estate Investment Funds (FIIs, in the Portuguese acronym);
- “FIAGRO-Participações”; which adheres to the regulatory framework of Equity Investment Funds (FIPs, in the Portuguese acronym).
