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nid 95356
Sep 25, 2026
rghosh@vixio.com
Brazil
BCB - Standards
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2159 charsBrazil's Central Bank Restricts Credit Rights Fund Investments in Litigation-Linked Assets
On September 24, 2026, Brazil's Central Bank (Banco Central do Brasil) published Resolution CMN No. 5.343, which amends Resolution No. 2.907 of November 29, 2001, governing credit rights investment funds and credit rights fund quota investment funds.
The resolution introduces restrictions on credit rights funds' ability to invest, directly or indirectly, in rights or expectations arising from judicial actions or arbitration proceedings. Funds may only invest in such assets once the underlying credit achieves liquidity, certainty, and enforceability on a definitive basis. For judicial proceedings, this requires: final judgment recognizing the right in the knowledge phase; final judgment in the liquidation phase determining the amount owed, if necessary; and expiration of the legal period for challenging sentence execution or arbitration objections without presentation, or final judgment dismissing such challenges if presented. For arbitration proceedings, requirements include: issuance of an arbitral award recognizing the right and fixing the amount owed; and expiration of the period for filing nullity actions under Law No. 9.307 of September 23, 1996, without such action being filed, or final judgment dismissing or extinguishing any filed action.
The resolution also defines indirect investment as acquisition of securities, financial instruments, fund quotas, or derivative instruments whose underlying assets or cash flows are linked to such litigation-derived rights. Funds holding prohibited litigation-linked assets must adopt consistent, independently verifiable valuation methodologies; conduct revaluations following material procedural developments; submit to independent audit verification; and disclose standardized, comparable information monthly in structured electronic format, including fund identification, judicial or arbitration proceeding details, cedent and cessionary identification, credit value and fraction held, and portfolio composition by debtor entity.
The resolution enters into force October 13, 2026, regarding investment restrictions, and January 4, 2027, regarding disclosure and valuation requirements.
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2041 charsCentral Bank of Brazil Issues CMN Resolution No. 5,343 Restricting Credit Rights Fund Investments
On September 24, 2026, Brazil's Central Bank (BCB) published Resolution CMN No. 5.343, governing credit rights investment funds and credit rights fund quota investment funds.
The resolution introduces restrictions on credit rights funds' ability to invest, directly or indirectly, in rights or expectations arising from judicial actions or arbitration proceedings. Funds may only invest in such assets once the underlying credit achieves liquidity, certainty, and enforceability on a definitive basis. For judicial proceedings, this requires:
Final judgment recognizing the right in the knowledge phase.
Final judgment in the liquidation phase determining the amount owed, if necessary.
Expiration of the legal period for challenging sentence execution or arbitration objections without presentation, or final judgment dismissing such challenges if presented.
For arbitration proceedings, requirements include:
Issuance of an arbitral award recognizing the right and fixing the amount owed.
Expiration of the period for filing nullity actions without such action being filed, or final judgment dismissing or extinguishing any filed action.
The resolution also defines indirect investment as acquisition of securities, financial instruments, fund quotas, or derivative instruments whose underlying assets or cash flows are linked to such litigation-derived rights.
Funds holding prohibited litigation-linked assets must:
Adopt consistent, independently verifiable valuation methodologies.
Conduct revaluations following material procedural developments.
Submit to independent audit verification.
Disclose standardized, comparable information monthly in structured electronic format, including fund identification, judicial or arbitration proceeding details, cedent and cessionary identification, credit value and fraction held, and portfolio composition by debtor entity.
The resolution enters into force October 13, 2026, regarding investment restrictions, and January 4, 2027, regarding disclosure and valuation requirements.