SEBI (Foreign Portfolio Investors) (Amendment) Regulations, 2021


Quick Summary
The Securities and Exchange Board of India (SEBI) has issued the SEBI (Foreign Portfolio Investors) (Amendment) Regulations, 2021. These amendments, effective from their publication in the Official Gazette, modify the existing 2019 regulations. Notably, the changes update Regulation 4 concerning the constituents of an applicant. Non-resident Indians, overseas citizens of India, and resident Indian individuals can be constituents under specified conditions. Additionally, resident Indian entities, other than individuals, may also be constituents if they are eligible fund managers and the applicant is an approved eligible investment fund.

SECURITIES AND EXCHANGE BOARD OF INDIA

NOTIFICATION

Mumbai, the 3rd August, 2021

SECURITIES AND EXCHANGE BOARD OF INDIA (FOREIGN PORTFOLIO INVESTORS) (AMENDMENT) REGULATIONS, 2021

No. SEBI.LAD-NRO/GN/2021/32. - In exercise of the powers conferred by sub-section (1) of Section 30 read with sub section (1) of Section 11, clause (ba) of sub-section (2) of Section 11 and sub-sections (1) and (1A) of Section 12 of the Securities and Exchange Board of India Act, 1992, and under Section 25 of the Depositories Act, 1996, the Securities and Exchange Board of India hereby, makes the following regulations, to further amend the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019, namely,-

1. These regulations may be called the Securities and Exchange Board of India (Foreign Portfolio Investors) (Amendment) Regulations, 2021.

2. They shall come into force on the date of their publication in the Official Gazette.

3. In the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019 –

I. In Regulation 4, clause (c) shall be substituted with the following, namely, –

“(c) non-resident Indians or overseas citizens of India or resident Indian individuals may be constituents of the applicant provided they meet the conditions specified by the Board from time to time:

Provided that resident Indian other than individuals, may also be constituents of the applicant, subject to the following conditions, namely –

i. such resident Indian, other than individuals, is an eligible fund manager of the applicant, as provided under sub-section (4) of section 9A of the Income Tax Act, 1961 (43 of 1961); and

ii. the applicant is an eligible investment fund as provided under sub-section (3) of section 9A of the Income Tax Act, 1961 (43 of 1961) which has been granted approval under the Income Tax Rules, 1962;”

AJAY TYAGI, Chairman

[ADVT.-III/4/Exty./177/2021-22]

Footnote:

1. The Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019 were published in the Gazette of India on September 23, 2019 vide No. SEBI/LAD-NRO/GN/2019/36

2. The Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019 were subsequently amended on, –

(1) 19th December, 2019 by the Securities and Exchange Board of India (Foreign Portfolio Investors) (Amendment) Regulations, 2019 vide No. SEBI/LAD-NRO/GN/2019/44.

(2) 07th April, 2020 by the Securities and Exchange Board of India (Foreign Portfolio Investors) (Amendment) Regulations, 2020 vide No SEBI/LAD-NRO/GN/2020/09

(3) On 17 April, 2020 by the Securities and Exchange Board of India (Regulatory Sandbox) (Amendment) Regulations, 2020 vide No. SEBI/LAD-NRO/GN/2020/10.

FAQ :

These are amendments made by the Securities and Exchange Board of India to the existing SEBI (Foreign Portfolio Investors) Regulations, 2019, which came into force upon their publication in the Official Gazette.

The regulations come into force on the date of their publication in the Official Gazette.

Regulation 4, clause (c) has been substituted. It now specifies that non-resident Indians, overseas citizens of India, or resident Indian individuals may be constituents of an applicant, provided they meet SEBI's conditions. It also allows resident Indian entities (other than individuals) to be constituents under specific conditions related to fund management and investment fund eligibility.

Yes, resident Indian individuals may be constituents of an applicant, provided they meet the conditions specified by SEBI.

A resident Indian entity, other than an individual, can be a constituent if it is an eligible fund manager under the Income Tax Act, 1961, and the applicant is an eligible investment fund approved under the Income Tax Rules, 1962.

 



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