Alternative Investment Funds (Amendment) Regulations

SECURITIES AND EXCHANGE BOARD OF INDIA (Alternative Investment Funds) (Amendment) Regulations, 2023

No. SEBI/LAD-NRO/GN/2023/113.— In exercise of the powers conferred by sub-section (1) of Section 30 read with sub-section (1) of Section 11, clause (ba) and clause (c) of sub-section (2) of Section 11 and sub section (1) and (1B) of Section 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992), the Board hereby makes the following regulations to further amend the Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012, namely,:—

1. These Regulations may be called the Securities Exchange Board of India (Alternative Investment Funds) (Amendment) Regulations, 2023.
   
2. They shall come into force on the date of their publication in the Official Gazette.
   
3. In the Securities Exchange Board of India (Alternative Investment Funds) Regulations, 2012 ,—
   
   I. in regulation 2, in sub-regulation (1),
   
   i. after clause (h), the following clause shall be inserted, namely,-
   “(ha) “credit default swaps” shall have the same meaning as assigned to it in the Master Direction – Reserve Bank of India (Credit Derivatives) Directions, 2022.”
   
   ii. existing clause (ha) shall be re-numbered as clause (hb).
   
   II. in regulation 16, in sub-regulation (1), after clause (a) and before clause (b), the following clause shall be inserted, namely,-
   “(aa) Category I Alternative Investment Funds may engage in hedging, including credit default swaps in terms of the conditions as may be specified by the Board from time to time.”
   
   III. in regulation 17, after clause (d) and before clause (e), the following clause shall be inserted,
   namely,-
   “(da) Category II Alternative Investment Funds may buy or sell credit default swaps in terms of the conditions as may be specified by the Board from time to time.”
   
   IV. in regulation 18, after clause (aa) and before clause (b) the following clause shall be inserted, namely,-
   “(ab) Category III Alternative Investment Funds may buy or sell credit default swaps in terms of the conditions as may be specified by the Board from time to time.”
   
   V. in regulation 20, in sub regulation (11), after the second proviso, the following shall be inserted,
   namely,-
   “Provided further that the Sponsor or Manager of the Category I and Category II Alternative Investment Fund transacting in credit default swaps shall appoint a custodian registered with the Board and comply with such terms and conditions as may be specified by the Board.”

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