On March 25th, 2019, the Brazilian Securities and Exchange Commission (“CVM”) issued “CVM” Instruction No. 606/2019 (“ICVM No. 606”), amending Instruction 555/2014 (“ICVM No. 555”) to include specific rules applicable to Incentive Funds of Investment in Infrastructure and Investment Funds in Quotas of Incentive Investment Funds (“Fundos Incentivados de Investimento em Infraestrutura e Fundos de Investimento em Cotas de Fundos Incentivados de Investimento” -“FI-Infra”).

Under “ICVM nº 606”, “FI-Infra” are incentive investment funds of the “Fixed Income” (“Renda Fixa”) class, and may be constituted as an open or closed condominium. “FI-Infra” are included among the investment funds referred to in art. 3 of Law No. 12,431 / 2011, which, in turn, establishes that “the institutions authorized by the Brazilian Securities and Exchange Commission to exercise the portfolio management of securities may constitute an investment fund, which provides in its regulation that the application of its resources in the assets referred to in art. 2 shall not be less than 85% (eighty-five percent) of the value of the net equity of the fund.”

“ICVM 606” also establishes own limits per issuer for the case of investments of “FI-Infra” in securities that comply with the provisions in the mentioned art. 2 of Law No. 12,431 / 2011 , as follows: (i) 20% of shareholders’ equity for funds intended for investors in general, (ii) 40% of shareholders’ equity for funds allocated to qualified investors, and (iii) unlimited in relation to shareholders’ equity for professional investors.

The deadline for setting the new concentration limits will be 2 years from the date of the first payment of quotas for open funds and the closing date of the distribution for closed funds.

The period, for investment funds in operation at the date of publication of “ICVM No. 606” and whose purpose is to be in compliance with the tax regime of Law 12,431 / 2011, to comply with the standards implemented by such instruction shall be 2 years counted of the date of the general meeting of shareholders that deliberates such change.

Further information, as well as the full text of “ICVM No. 606”, can be found on the “CVM” website (http://www.cvm.gov.br/).