The central bank (BCU) regulated since January 2 the figure of the qualified investor. In October 2022, the BCU had published a project to introduce the definition of qualified investor.
The regulatory project established that qualified investors are natural or legal persons who own experience and knowledge necessary to understand, evaluate, assume and adequately manage the risks inherent in any investment decision.
Within the category were included as of January the central government, departmental governments, autonomous entities and decentralized services and parastatal funds; financial intermediation institutions; pension savings fund administrators for themselves and for the funds they manage and insurance and reinsurance companies. Also, among others, investment advisors, portfolio managers, international organizations and foreign institutions that manage investment funds..
In addition, the initiative of the Superintendence of Financial Services of the BCU established that natural or legal persons who request to be considered as qualified investors to invest in instruments that require such qualification, must have at the time of doing so a balance of financial assets for an amount no less than 4 million indexed units (about US$ 560 thousand at current values).
Other conditions that must be fulfilled are to have a professional degree and prove that they have carried out some of the following instances: Relevant courses on securities markets that are taught by local or foreign universities; have a postgraduate degree in finance or have passed internationally recognized exams.
It is also required to have held for at least two consecutive years a position linked to investment decision-making, to the provision of investment advisory services or portfolio management in an institution regulated by the BCU or by the securities market regulator in their country of origin, as explained by the project.
Jean Jacques Bragard, founding partner of the firm Bragard Asociados, said that the figure of the qualified investor “puts into effect an iImportant stimulus to investment funds operating in Uruguay”.
He recalled that the figure of qualified investor was created in the 2020 Budget Law.
Bragard explained that “together with the definition of qualified investor regulated by the Central Bank, it was established that the investment limits that currently apply will not apply to investment funds when they are aimed at qualified investors.”
Finally, he added that “others not included in said list may also access, upon request to the regulatory body and accrediting their experience and knowledge.”
