CVM Resolution No. 175: A New Framework for Investment Funds in Brazil

CVM Resolution No. 175, published on December 23, 2022, came into force in October 2023 and represents a regulatory milestone for investment funds in Brazil. Replacing the old CVM Instruction 555 and 38 other rules, it aims to modernize, simplify and align the Brazilian market with the best international practices.

Now, in May 2025, with most of its provisions fully in force, it is possible to assess more precisely the positive impact of the new rule on the fund industry in the country.

Main Changes and Impacts

1. modular and flexible structure

The resolution adopts a structure composed of a general part and specific annexes for different types of funds, such as FIFs, FIDCs, FIIs, FIPs and ETFs. This approach allows for regulation that is more adapted to the particularities of each category of fund.

2. Segregation of Assets by Share Class

The new regulations introduce the possibility of a three-tier structure: fund, class and sub-class. Thus, it is possible for the same fund to have different classes of shares with segregated assets.

Each class has segregated assets, allowing for different strategies within the same fund. This means that each class is only liable for its own obligations, offering greater protection to shareholders.

The subclasses cater for different target audiences, terms and fees, offering greater flexibility and operational efficiency.

3. Limited Liability of Shareholders

Shareholders will now have their liability limited to the value of their subscribed shares, provided that this condition is laid down in the fund's regulations.

This change provides greater legal certainty and predictability for investors.

3. Broadening Access to Investments

The Resolution allows the general public to invest in senior quotas of FIDCs, previously restricted to qualified investors. In addition, funds can invest up to 100% of their net assets abroad, expanding diversification opportunities

4. Inclusion of Innovative Assets

Funds can now invest up to 10% of their net assets in crypto-assets and carbon credits, provided they are traded on authorized platforms.

4. Redefining the Roles of Managers and Administrators

Managers and administrators are now considered “essential service providers”, with well-defined responsibilities. The manager, for example, takes on the hiring of distributors and other providers, while the administrator is responsible for operational and compliance aspects.

5. Transparency in Fees and Governance

The resolution requires separate disclosure of administration, management and distribution fees in fund documents. This allows investors to better understand the costs involved and make more informed decisions.

It also strengthens governance by establishing clear rules for the performance of service providers.

7. Compulsory Registration of Credit Rights

FIDCs must register their credit rights with entities authorized by the Central Bank. This measure aims to increase transparency and security in the operations of these funds.

Current Relevance

As of May 2025, CVM Resolution 175 is already fully in force, and the movements of the investment fund market in Brazil are increasingly being observed. It promotes greater legal certainty, transparency and alignment with international standards, making the market more attractive to domestic and foreign investors.

The consolidation of rules and the introduction of more flexible structures allow managers to offer products that are better suited to investors' needs, while the protection measures strengthen confidence in the financial system.