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SEBI comes out with guidelines for investment advisers in IFSC

According to Sebi, an IA or parent entity will fulfill the networth requirement, separately and independently, for each activity undertaken by it.

Published: 28th September 2020 07:01 PM  |   Last Updated: 28th September 2020 07:01 PM   |  A+A-

SEBI

SEBI (File Photo | Reuters)

By PTI

NEW DELHI: Markets regulator Sebi on Monday came out with a new framework for investment advisers operating in the international financial services center (IFSC).

Under the framework, any entity, being a company or a limited liability partnership (LLP) or any other similar structure recognized under the laws of its parent jurisdiction, desirous of operating in IFSC as an investment adviser (IA), may form a company or LLP to provide investment advisory services, Sebi said in a circular.

It further said the formation of a separate company or LLP will not be applicable in case the applicant is already a company or LLP in IFSC.

According to Sebi, an IA or parent entity will fulfill the networth requirement, separately and independently, for each activity undertaken by it.

An IA will ensure to conduct the annual audits in respect of compliance with investment adviser regulations and these guidelines from a chartered accountant from a company secretary.

Sebi said persons seeking registration under the investment adviser norms would provide the services only to those persons mentioned in the IFSC guidelines.

"Further, IAs shall ensure to comply with the applicable guidelines issued by the relevant overseas regulator/ authority, while dealing with persons resident outside India and non-resident Indians seeking investment advisory services from them," Sebi noted.

Earlier in January, Sebi had put in place guidelines for entities for operating as investment advisers in IFSC, under which such advisers need to have a net worth of at least USD 1.5 million.

Now, the Securities and Exchange Board of India (Sebi) has amended its operating guidelines in this regard.

The country's only IFSC is in GIFT-City near Ahmedabad in Gujarat.



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