/ CCR of Chile confirms that it will approve actively managed ETFs

The CCR amended its Resolution No. 32 to allow for the approval of actively managed ETFs as eligible instruments for Chilean pension funds. This modification provides new investment opportunities in actively managed ETFs.

Yu Lay 
Associate
Alessandri

On June 3, 2023, Resolution No. 59 of the CCR (“Comisión Clasificadora de Riesgo”), adopted at its 490th ordinary meeting held on May 25, 2023, was published in the Chilean Official Gazette. Resolution No. 59 modified Articles 1 and 24 of Resolution No. 32, which establishes the procedure for the approval of foreign instruments.

By virtue of the amendment in question, the CCR may admit the approval of actively managed ETFs as eligible instruments for the general investment category by Chilean pension funds. This was anticipated in the opinion issued by the Pension Regulator (Superintendencia de Pensiones – “SP”), in an opinion letter (Oficio 6383 of 2022), in which the regulator determined that the Pension Funds Investment Regime does not restrict the definition of ETFs to those that follow passive strategies.

To this effect, letter h) of Article 1 of Resolution 32, which previously referred to ETFs as “Securities that represent Stock Indexes or Fixed Income Indexes”, was replaced. They are now listed as “Securities that represent Financial Indexes” and are defined as “financial instruments listed on stock exchanges, backed by a basket of assets such as equities, fixed income, from which their value is derived, and which generally follow the performance of a financial index”.

Thus, the CCR has formally admitted the possibility of approval of ETFs that do not track a financial index, such as ETFs that follow active strategies.