Chilean Pension Funds Market Officially Open for Business for Irish UCITS

May 09, 2014

Following Dechert’s series of reports in relation to the Chilean pension funds market and its accessibility to Irish UCITS, see Dechert OnPoint - Moody’s Upgrade Points to Reopening of the Chilean Pension Market to Irish UCITS and Dechert OnPoint - Irish Domiciled UCITS Moved to Restricted Investments Status by Chilean Regulator, Dechert is pleased to report that the Chilean pension funds market is officially open for business with respect to Irish UCITS.

In January, Dechert predicted that the decision by Moody’s to follow Fitch and S&P and upgrade Ireland’s sovereign debt rating, coupled with a modification of domestic Chilean rules and Ireland’s exit from its EU bailout programme would smooth the path for Irish UCITS to re-enter the Chilean pension funds market and get back on the “general investment list”. This followed a near three year hiatus when, in late August 2011, the Chilean Pensions Regulator, the Comisión Clasificadora de Riesgo (the “CCR”), moved Irish UCITS to its “restricted investments list” following the downgrade of Irish sovereign debt to below investment grade status.

Last Friday saw the first tranche of Irish UCITS re-enter the Chilean market, when news of the CCR’s approval of 17 PIMCO funds and four GAM funds was published in the Chilean official gazette. Ignites Europe* reports that these are the first Irish UCITS fund groups to successfully re-enter the Chilean pension funds market since Ireland’s sovereign debt crisis.

This market is an important one for Irish UCITS and the news that Chile has reopened for Irish funds is a very positive development. With over $170bn in AUM and the flexibility to invest up to 80% abroad, there is a huge pool of investment in the Chilean pension funds market which Irish UCITS can now target.

Dechert monitors regulatory and market developments in Chile and more than 104 jurisdictions globally as part of our comprehensive service for supporting the cross-border distribution of investment funds.

* Chile reopens pensions market to Irish UCITS, Ignites Europe, 6 May 2014.

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