2023 Laws of Puerto Rico › TITLE ELEVEN - Workmen’s Compensation (§§ 1 — 268) › Chapter 1 - Workmen’s Accident Compensation (§§ 1 — 42) › § 30a - Types of authorized investments

The Corporation shall keep invested all available resources not required for its current operation and may invest in the following securities:
(a) Flat yield securities.—
(1) Money market instruments (short term).—
(A) Money market instruments issued by the Government of the United States, its agencies and instrumentalities and the Commonwealth of Puerto Rico, its agencies and instrumentalities. It includes federal Treasury Bills and bonds issued by either government within one year of maturity.
(B) Money market instruments issued by private institutions which are classified within the highest credit rating levels.
(2) Capital market instruments (long term).—
(A) Capital market instruments such as bonds, notes, promissory notes and any other long term maturity instruments which are a direct obligation of the National Treasury of the United States.
(B) Debt instruments of federal, state, and municipal agencies, instrumentalities and any other political subdivisions, classified within the highest credit rating levels which represent direct obligations or which are guaranteed by the good faith and credit of these government entities, instrumentalities, enterprises or public corporations and any other government agencies created pursuant to the laws of the Government of the United States and its states.
(C) Obligations of the Commonwealth of Puerto Rico, its instrumentalities and/or its public corporations.
(D) Debt instruments such as bonds, promissory notes and other long-term obligations, issued by institutions from the private sector, which fall within the highest credit rating levels.
(E) Bonds, promissory notes and obligations with a dollar or any other strong currency denomination issued and guaranteed by the central governments of foreign countries (Euro-Bonds) classified within the top two credit rating levels by a credit rating agency.
(F) Financial instruments directly or indirectly constituted upon financial obligations, such as mortgage loans and instruments with such loans as collateral classified within the highest credit rating levels.
The Board shall specify in its bylaws the maximum percentage of the total resources available for investment by the Corporation that may be invested in flat yield securities.
All investments other than direct obligations of the Treasury of the United States shall be classified within the highest credit rating levels except when otherwise provided in this chapter; Provided, That the Corporation shall use at least $335,000,000 during Fiscal Year 2015-2016, as well as during Fiscal Year 2016-2017, to acquire tax and revenue anticipation notes issued by the Commonwealth of Puerto Rico from time to time and/or any other instrument issued by the Government Development Bank for Puerto Rico, for the purpose of acquiring said notes, regardless of the credit rating of such instruments, any limit or restriction in the investment policies or contractual obligations applicable to the Corporation; provided, further, that said notes or other instruments shall have a yield equal to or higher than the average yield of the Corporation’s fixed-income investment portfolio for the twelve (12)-month period preceding March 31, 2015 and March 31, 2016, as appropriate, which shall not be less than a six-percent (6%) annual interest rate.
(b) Stocks.—
(1) The Corporation is hereby authorized to invest up to twenty-five percent (25%) of its total resources for the negotiation of common or preferred stock of any corporation created under the laws of any state of the United States, the federal government, the Government of the Commonwealth of Puerto Rico, and/or any foreign country, subject to the following criteria:
(A) The stock to be acquired shall be quoted openly in one or more financial markets or other national or international electronic quotation systems.
(B) Securities may be acquired through private placements, provided that the following criteria and other criteria deemed necessary by the Board are complied with:
(i) That according to the profit potential of the issuer said securities be undervalued.
(ii) That the total investment amount does not exceed the percentage of the total resources of the Fund, which is to be specified in the regulations of the Board.
(iii) That the securities be issued by corporations registered in the N.Y. Stock Exchange or other recognized exchanges of the United States.
(iv) That the statutes of the issuing corporation and its shareholders allow it.
(C) The Board shall specify in its regulations the percentages and maximum and minimum values in dollars corresponding to the following criteria:
(i) The proportion of its resources the corporation may invest in this type of securities.
(ii) The minimum market value of an enterprise (in dollars) in which an investment may be made.
(iii) The maximum percentage of authorized and outstanding stock of an enterprise that may be acquired by the Corporation.
(iv) The maximum percentage of the funds to be invested in a financial sector.
(c) Real estate.— The Corporation is hereby authorized to purchase, retain and receive real estate property in conveyance for the following and not for any other purposes:
(1) Such as may be necessary to establish offices in order to conduct business, with permission to rent to others the remaining space in the same building, whether equipped or not.
(2) Such as may be conveyed for the payment of personal or property debts previously contracted in the course of its operations.
(3) Such as may be purchased or acquired in judiciary sales, by decree or mortgage, on behalf of the Corporation, or such as may be purchased or acquired in order to insure the amounts indebted.
(d) Financial instruments.— The Board may authorize the Corporation, through regulations to that effect, to use financial instruments such as options, futures, futures contracts and transactions related to foreign currency exchange with the sole purpose of reducing risk.
History —Apr. 18, 1935, No. 45, p. 250, added as § 29A on Oct. 29, 1992, No. 83, § 3; renumbered as § 27A on July 1, 1996, No. 63, § 3; July 2, 2015, No. 102, § 1; July 14, 2016, No. 69, § 1.