/ Pension Funds. Proposed Amendments to the Pension Fund Investment Regime

January 17, 2022

Nicole Cartier
Senior Associate Alessandri
Capital Markets


From December 24, 2021 to January 10, 2022, the draft of General Applicability Rule (NCG) No. 425 issued by the Superintendency of Pensions, which seeks to incorporate some flexibility to the investments that Chilean pension funds may make, was under consultation.

  1. To date, in order to invest in shares of domestic closely-held corporations, domestic joint stock companies (SpA) and domestic limited partnerships, that invest in alternative assets (real estate assets, private equity, private debt, infrastructure and other assets traded in private markets, as well as vehicles whose purpose is to invest in commodities), two independent economic valuation reports were required.

The amendment seeks to allow investment in these types of assets with only one independent valuation report.


  1. Until now, investments in shares of domestic investment funds of those not approved by the CCR (i.e. the agency in charge of determining when an asset is an eligible investment for Chilean pension funds), in case of exceeding the investment limits contemplated in the Investment Regime (0.5% of the value of the fund), had to be corrected within quite limited periods of time.

The amendment seeks to apply to the excess investment in shares of domestic investment funds not approved by the CCR, which preferably invest in alternative assets, the same terms as those provided for investment in foreign alternative assets, so as to subject domestic alternative assets to the same rules as foreign alternative assets in this respect. In this way, the excess resulting of the investment in such fund shares may be maintained until such time as the fund manager deems to obtain an adequate return for the fund.


  1. To date, the accounting of future promises or commitments, for the purposes of the limits of investment in alternative assets, is made as if it were an effective investment, whereas said investment may not materialize in its entirety.

The amendment proposes to account for 60% of future promises or commitments in the alternative asset limits, giving pension funds room to invest in other instruments that may offer better risk-return combinations.


  1. To date, there was an amendment introduced to Article 45 of D.L. No. 3,500 by Law No. 21,130, which allowed pension funds to invest in bonds with no fixed maturity issued by banking companies (Article 55 bis of the General Banking Law regulates the structure and characteristics of such bonds).

The amendment incorporates the investment limit in this type of bonds at 5% for Type A and B Funds and 2% for Type C Funds.