On March 31, 2022, the Financial Market Commission (“CMF” or “Commission”) issued General Rule No. 468 (the “NCG 468”) which regulates the authorization process for the start-up of general fund managers.
According to NCG 468, the authorization to start operations may be carried out together with the authorization of existence, or after such authorization has been granted, without the fund managers being able to start their operations, that is, to deposit the first internal regulations of any mutual or investment fund in the deposit maintained for such purpose by the Commission, without having been granted both the corresponding authorization of existence and the authorization to start operations by means of a founded resolution issued by the CMF.
The same regulation establishes the necessary requirements for the purposes of requesting the authorization to commence operations, and an application must be made together with the following documents:
a) Outline containing the estimated organizational and functional structure, with a brief description of the functions of each unit and identification of the Committees that will support the management of the manager and of the persons or units in charge of the risk management, internal audit and compliance functions.
b) Initial version of the Security and Information Management Policies.
c) Initial version of the Risk Management and Internal Control Manual.
d) Initial version of the Manual for the Prevention of Money Laundering, Bribery or Financing of Terrorism.
e) Document containing a brief general description of the main information or support systems for the relevant processes of the fund manager, with an indication of those for information security.
f) Initial version of the entity’s risk matrix, grouped according to the business cycles contemplated in Section III of Instruction No. 1,869 of 2008, with an indication of the probability of risk materialization and estimated impact before and after the strategic responses adopted by the entity.
g) Identification of the areas or services that the entity considers will be outsourced, indicating the counterparties, in the event that the respective contracts have been entered into, and the safeguards that will be adopted to ensure that such outsourcing does not affect the normal operation of the fund manager, the protection of client information and does not generate circumstances that may result in an inadequate resolution of conflicts of interest.
h) Initial version of the Business Continuity Plan, for which it is recommended to use the template and instructions for the preparation of plans for non-governmental entities of the Federal Emergency Management Agency of the United States Department of Homeland Security (FEMA), or the Methodology for the Preparation of the Operational Continuity Plan issued by the National Emergency Office of the Ministry of the Interior and Public Security (ONEMI).
Finally, the regulation states that once the background information has been reviewed and any observations made by the Commission have been corrected, the resolution authorizing the commencement of operations will be issued without further procedure, and from that moment on, the fund manager may begin to deposit regulations of the funds in the respective depository.