Circular Letter CVM/SIN 01/20

SECURITIES AND EXCHANGE COMMISSION OF BRAZIL
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Circular Letter No. 1/2020-CVM/
Rio de Janeiro, January 09, 2020.
To
Administrators of investment funds regulated by CVM Instruction No. 555 Subject: Interpretation of Article 103, § 1, and Articles 119, § 7, c/c Article 126, all of CVM Instruction No. 555

Dear Sir,

1. We refer to the possibility, provided for in Article 103, § 1, of CVM Instruction No. 555, of applying up to 100% of its net asset value in shares of other investment funds, provided they meet the requirements set forth in Articles 120 and 121 of the same Instruction.

2. In the interpretation of the technical area for the aforementioned provision, such permission applies not only to investment funds intended for the general public, but also to funds intended for qualified investors, who, therefore, are equally authorized to acquire up to 100% of their net asset value in shares of other investment funds intended for qualified investors.

3. This understanding prevails over a possible erroneous reading of the provisions of Article 119, § 7, c/c Article 126, of the same Instruction, which has been raised at times by market participants, which at first glance could suggest an investment limitation, by investment funds intended exclusively for qualified investors, to 40% of their net asset value in shares of other funds dedicated to this same target audience. Note, however, that Article 119, §7°, refers only to investment funds in shares not intended exclusively for qualified investors.

4. In this regard, in the evaluation of the technical area, the interpretation regarding the possibility of investment without limits by such funds also maintains greater coherence
   Circular Letter 1 (0914196) SEI 19957.000115/2020-85 / pg. 1

systematically with the provisions and concentration limits provided for in CVM Instruction No. 555 and its segmentation according to the different target audiences of the investment funds provided for therein.

Sincerely,

Daniel Walter Maeda Bernardo
Superintendent of Institutional Investor Relations

Document electronically signed by Daniel Walter Maeda Bernardo, Superintendent, on 09/01/2020, at 11:42, based on art. 6, § 1, of Decree No. 8.539, of October 8, 2015. The authenticity of the document can be checked on the site https://sei.cvm.gov.br/conferir_autenticidade, informing the code verifier 0914196 and the CRC code 7401D0B2. This document's authenticity can be verified by accessing https://sei.cvm.gov.br/conferir_autenticidade, and typing the "Código Verificador" 0914196 and the "Código CRC" 7401D0B2. Reference: Process No. 19957.000115/2020-85 SEI Document No. 0914196 Circular Letter 1 (0914196) SEI 19957.000115/2020-85 / pg. 2