The City Football Group also own A-League side Melbourne City, hold a controlling stake in New York City FC of Major League Soccer and 20 per cent of J1 League club Yokohama F Marinos.
CA Torque are a much smaller-scale operation than those clubs. Founded in 2007 and currently playing in the second division of the Uruguayan league, CA Torque has an average attendance of around 250 for home matches.
City highlighted the agreement, which has been ratified by the Uruguayan Football Association, as one that will strengthen its scouting and recruitment operation in the country — citing the success of Uruguayan forward Bruno Fornaroli, the 2015-16 A-League Golden Boot winner with Melbourne City.
Goal reported last month that City was in the final stages of acquiring Torque. Gabriel Jesus' £27 million move from Brazilian side Palmeiras to Manchester City was held up by third-party ownership issues, with the club hoping that a presence in South America could help avoid similar hurdles in the future.
Venezuelan Primera Division side Atletico Venezuela will benefit from the sharing of scouting data and coaching support, including a number of agreed visits to Manchester, under the collaboration agreement.
"We are pleased to take this next step in our football development operations," said City Football Group chief executive Ferran Soriano.
"The investment in CA Torque enables our organisation to build on existing connectivity in Uruguay and helps to expand the options for identifying and developing local and South American talent.
"This move also provides us with an administrative hub for our pre-existing scouting operations in the region and provides a footprint for City Football Group in South America.
"I am also delighted to start a working partnership with Atletico Venezuela to the benefit of both clubs."
City have previous dealings with another Uruguayan second tier side, Deportivo Maldonado, having bought goalkeeper Geronimo Rulli from them last July, before loaning the Argentinian to Real Sociedad, where he spent the previous two seasons.
In January, Sociedad completed a permanent deal for Rulli, although City are widely reported to retain a buyback option.
Teenage Venezuela midfielder Yangel Herrera signed for City from Atletico Venezuela in January before joining NYCFC on loan.