SEBI (Mutual Funds) (Third Amendment) Regulations, 2022

SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI) (MUTUAL FUNDS) (THIRD AMENDMENT) REGULATIONS, 2022

SEBI/LAD-NRO/GN/2022/106.—In exercise of the powers conferred by section 30 read with clause (c) of sub-section (2) of section 11 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 (Mutual Funds) Regulations, 1996, namely–

1. These Regulations may be called the Securities and Exchange Board of India (Mutual Funds) (Third Amendment) Regulations, 2022.
   
2. They shall come into force on the sixtieth day from the date of publication of these regulations in the Official Gazette.
   
3. In the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996, –
   
   I Regulation 53 shall be substituted with the following regulation, namely, –
   
   “Transfer of dividend and redemption proceeds
   53. Every mutual fund and asset management company shall,
   (a) transfer to the unitholders the dividend payments within such period as may be specified by the Board from time to time;
   (b) transfer to the unitholders the redemption or repurchase proceeds within such period as may be specified by the Board from time to time;
   (c) in the event of failure to transfer the redemption or repurchase proceeds or dividend payments within the period specified in clauses (a) and (b), the asset management company shall be liable to pay interest to the unitholders at such rate as may be specified by the Board for the period of such delay;
   (d) notwithstanding payment of such interest to the unit-holders under clause (c), the asset management company may be liable for action for failure to transfer the redemption or repurchase proceeds or dividend payments within the stipulated time:
   Provided that physical despatch of redemption or repurchase proceeds or dividend payments shall be carried out only in exceptional circumstances and asset management companies shall be required to maintain records along with reasons for all such physical despatches.”

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