Alternate Investment Fund ("AIF") is a relatively new concept in India as it is just a decade-old concept, which was boosted by the surge of Venture Capital Investments in India. The Securities Exchange Board of India ("SEBI") in 2012 brought- the SEBI (Alternative Investment Funds) Regulations, 2012 (the "AIF Regulations") for the first time.
In a fast-growing and versatile economy like India, AIF regulations and reporting requirements for AIFs are bound to undergo a lot of changes and lack uniformity.
SEBI, under Regulation 28 of SEBI (AIF) Regulations, 2012, has the power to call upon the AIFs to file such reports, as SEBI me deem fit with respect to the activities carried on by the AIFs. These reportings are majorly done by the AIFs through the SI Portal (https://siportal.sebi.gov.in/intermediary/index.html) of the SEBI.
SEBI has recently issued a master circular on July 31, 2023, for AIFs (the "Master Circular"). Chapter 15 of this master circular deals with the reporting requirements for AIFs. As per Clause 15.1.1 of the said master circular, AIFs are required to submit a report on their activity as an AIF to SEBI on a quarterly basis within a specified time limit from the end of each quarter in the prescribed format.
With the objectives of ease of compliance as well as to address the lack of uniformity issue in reporting formats, SEBI on September 14, 2023, issued a Circular SEBI/HO/AFD/SEC-1/P/CIR/2023/015 ("the Circular"). This Circular has been issued after consulting with the following associations of the AIF industry i.e.
- Indian Venture and Alternate Capital Association (IVCA) (https://www.ivca.in/)
- Equalifi (https://equalifi.org/)
Vide this Circular, SEBI has informed about the revision in the format of the quarterly reporting required under Clause 15.1.1 of the Master Circular. Both associations have been entrusted with the responsibility of hosting the revised format of the quarterly reporting and helping AIFs understand and resolve any issues that may arise in connection with the Circular.
The Circular is effective immediately and the AIFs are required to do the reporting as under
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For April to June 2023 quarter |
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For July to September quarter |
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From the quarter ending December 31, 2023, onwards |
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As per the requirement of the Circular, IVCA has, as of date, hosted the revised format for the quarterly report on its website and the same can be downloaded using this link https://www.ivca.in/regulatory-reports-sebi-circular
The SEBI and the related associations will also be reviewing the revised format periodically and if revised, will be making the further revised versions available to the AIFs at least 1 month prior to the end of the quarter.
It is imperative that regulators like SEBI recognize and help in implementing best though uniform practices through regulatory interventions. These actions are pivotal in sustaining the ongoing growth of AIFs, upholding the integrity of the securities market, ensuring the welfare of investors, and facilitating the orderly growth of the securities market and intermediaries.
Sources: SEBI Portal
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