Continuing our comments on Provisional Measure 881, already known as the "MP on Economic Freedom", we highlight today the provisions related to the liability of shareholders and service providers of investment funds.
Since investment funds are condominiums, the issue of the liability of their quotaholders for any liabilities of the funds has always been controversial.
In addition, the current regulations of the Brazilian Securities and Exchange Commission (CVM) allow for the liability of the service providers of the funds - notably the administrator, manager and custodian - in certain cases. In specific situations, CVM also requires solidarity among certain providers.
In fact, the liability of both shareholders and managers is increasingly common, especially in equity investment funds (FIP) and real estate investment funds (FII), and cases in which liabilities of invested companies reach the assets of shareholders, managers and administrators are not rare.
This scenario tends to change with the new Provisional Measure.
In one of its amendments to the Civil Code, the MP introduced provisions on the matter, allowing the regulation of an investment fund to limit the liability of each quota holder to the value of its quotas and the liability of the providers of fiduciary services, before the fund and among themselves, to the fulfillment of the duties of each one, without joint liability.
Depending on the regulation of the matter by CVM, investments in funds may become safer and, therefore, more attractive to more conservative investors.
Other impacts of the MP will be commented on in the following posts.
Partner Ricardo dos Santos de Almeida Vieira and the professionals of the Law and Capital Markets team of Barcellos Tucunduva Advogados are at your disposal for any advice or clarification on this matter.
