Through FIAGRO (Investment Funds in Agro-Industrial Production Chains), the Agricultural Sector will be able to directly raise financial resources available in the Capital Market.
FIAGRO may have its resources applied, for example:
rural properties;
participation in companies that carry out activities that are part of the agro-industrial production chain;
financial assets, credit securities or securities issued by individuals and legal entities that are part of the agro-industrial production chain;
agribusiness credit rights, such as the Agribusiness Credit Rights Certificate – CDCA, the Agribusiness Letter of Credit – LCA and the Agribusiness Receivables Certificate – CRA;
securitization securities issued backed by agribusiness credit rights, including agribusiness receivables certificates and shares in credit rights investment funds and non-standardized credit rights investment funds that invest more than 50% (fifty percent) of their equity in said credit rights;
real estate credit rights relating to rural properties and securitization securities issued backed by these credit rights.
The issue of FIAGRO posing a risk of transferring rural property to foreigners without observing the limits imposed by Law No. 5,709/1971 was already extensively debated when the bill was being processed by the Senate, having been discarded, partly because Law No. 8,668/1993 clearly states that the holder of Fund shares will not have any real rights over the properties comprising FIAGRO’s assets. To achieve this goal, it is still necessary to utilize diversified corporate structures, with or without the use of other legal entities.
In any case, FIAGRO is a new investment vehicle that will surely help agribusiness raise funds in the financial market.
