The Central Bank of Uruguay (BCU) began to publish information on the activity in the country of investment advisors and portfolio managers.
Official data for 2020 shows that a total of 155 had been registered with the regulator that year. These agents provided services to a total of 27,473 clients in different parts of the world, and had assets under management for about $28.8 million.
The most of the clients had Argentina as their country of residence. That year there were 18,850 with investments for an amount of $16.4 million. Clients with residence In uruguay there were 3,710 with assets of US$ 2.4 million. Meanwhile, residents in Brazil there were 1,386 with investments of US$ 1.6 million. Finally the clients residing in other countries they total about 3,527 and had investments for US$ 8.5 million, according to the registry of the monetary authority.
how they are distributed
Within the list of managed products, Investment funds were majority and totaled US$ 11.8 million and fixed income (bonds) totaled US$ 8.5 million. The rest is divided between instruments linked to stock market indices (shares), other equity instruments, derivatives, structured products and other instruments.
Among the services provided, the most common was channeling orders for an amount of US$15.9 million, and in second place discretionary portfolio management for US$10.4 million. The number of people employed in this area was 801 and they were distributed in 150 offices in the country. Counseling and referrals were also recorded.
portfolio managers are, according to the BCU, legal entities that, professionally and habitually, manage —on a discretionary and individualized basis—investments of third parties in accordance with administrative powers provided by them and that are not reached by another figure supervised by the Superintendence of Financial Services. They also have as complementary activities the channeling of orders, advice and referencing of clients to other financial institutions.
This new figure that was born in 2019 requires prior authorization from the BCU to operate, and among other things it is evaluated that it has seniority and reputation in the businesses it develops.
Meanwhile, investment advisers are people or companies that, professionally and habitually, advise to third parties regarding the investment, purchase or sale of money, precious metals or securities subject to public or private offering. They also channel the requests received from their clients to intermediaries located in the country or abroad. These entities do not require prior authorization to operate, but they do need registration in the BCU registry.
Like other financial agents, both advisers and managers must periodically report to the BCU information on advisory activities, and on policies and procedures for the prevention of money laundering and financing of terrorism.
The measure that the DGI ruled out
In February of last year, the General Tax Directorate (DGI) had requested portfolio managers who send information about their clients (name, address, countries or jurisdictions of tax residence, tax identification number, balance in your accounts). Finally, this measure was questioned by the Chamber of Investment Advisors and Portfolio Managers of Uruguay, whichrescinded in december past, according to El País.
In the resolution, the agency indicated that, on the one hand, the portfolio managers are financial entities subject to reporting, but that “they do not maintain financial accounts to report to the extent that they act in accordance with the BCU regulations that regulate their license.”
