BusinessLine (Delhi)

Move to curb front-running at AMCs leads a slew of SEBI board decisions

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The SEBI board on Tuesday approved measures to deter front-running at asset management companies.

This will be through an institutio­nal mechanism that includes enhanced surveillan­ce systems, internal control procedures, and escalation processes to identify, monitor, and address specific types of misconduct spanning front-running, insider-trading, and misuse of sensitive informatio­n.

NRI INVESTMENT­S IN FPI

SEBI has also allowed increased contributi­ons by non-resident Indians, overseas citizens of India, and resident Indian individual­s in the corpus of certain FPIs based out of GIFT IFSC, subject to conditions. At present, NRIs and OCIs can contribute a maximum of 49 per cent in an FPI.

A foreign fund set up at GIFT IFSC can have 100 per cent contributi­on from NRIs, OCIs, and resident Indians, subject to the FPI submitting copies of investors’ PAN along with their economic interest in the FPI or a declaratio­n along with documents such as passports and OCI cards.

AIF NORMS FOR VCS

Venture capital funds have been allowed to migrate to AIF regulation­s and get the facilities available for Alternativ­e Investment Funds to deal with unliquidat­ed investment­s. Migrated VCs can avail themselves of the flexibilit­ies under AIF Regulation­s on extension of tenure, liquidatio­n period, and dissolutio­n period to deal with unliquidat­ed investment­s.

Equity passive schemes have been allowed to invest up to 35 per cent of their net asset value in the group companies of the sponsor. The cap is 25 per cent for non-passive schemes.

The SEBI board has exempted fund managers and dealers from the requiremen­t of recording face-toface communicat­ion, including out-of-oŸce interactio­ns, during market hours.

UNITS FOR MANAGERS

The board has allowed investment managers of InvITs/REITs to receive units in lieu of management fees for the purpose of providing unit-based employee benefits.

 ?? ?? REGULATORY BOOST. The market regulator has also approved measures to increase NRI contributi­on, allow migration of VCFs, and exempt face-to-face communicat­ion recording
REGULATORY BOOST. The market regulator has also approved measures to increase NRI contributi­on, allow migration of VCFs, and exempt face-to-face communicat­ion recording

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