SEBI (Portfolio Managers) (Fourth Amendment) Regulations
SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI) (PORTFOLIO MANAGERS) (FOURTH AMENDMENT) REGULATIONS, 2021
No. SEBI/LAD-NRO/GN/2021/58.— 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 (Portfolio Managers) Regulations, 2020, namely, —
- These Regulations may be called the Securities and Exchange Board of India (Portfolio Managers) (Fourth Amendment) Regulations, 2021.
- They shall come into force on the thirtieth day from the date of their publication in the Official Gazette.
- In the Securities and Exchange Board of India (Portfolio Managers) Regulations, 2020,—
I. In regulation 2,
i. in sub-regulation (1),
a. after clause (ab), the following clause shall be inserted, namely, —
“(ac) “Alternative Investment Fund” shall have the same meaning as assigned to it in clause (b) of sub-regulation (1) of regulation 2 of the Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012;”
b. after clause (f), the following clause shall be inserted, namely, —
“(fa) “Co-investment Portfolio Manager” means a Portfolio Manager who is a Manager of a Category I or Category II Alternative Investment Fund(s); and:
(i) provides services only to the investors of such Category I or Category II Alternative Investment Fund(s); and
(ii) makes investment only in unlisted securities of investee companies where such Category I or Category II Alternative Investment Fund(s) make investments:
Provided that the Co-investment Portfolio Manager may provide services to investors from any other Category I or Category II Alternative Investment Fund(s) which are managed by them and are also sponsored by the same Sponsor(s);”
c. after clause (la), the following clauses shall be inserted, namely, —
“(lb) “investee company” shall have the same meaning as assigned to it in clause (o) of sub-regulation (1) of regulation 2 of the Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012;
(lc) “Manager” shall have the same meaning as assigned to it in clause (q) of subregulation (1) of regulation 2 of the Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012;”
d. after clause (q), the following clause shall be inserted, namely, —
“(r) “Sponsor” shall have the same meaning as assigned to it in clause (w) of subregulation (1) of regulation 2 of the Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012;”
II. In sub-regulation (2) of regulation 7,
i. in sub-clause (iii) of clause (d),
a. in the third proviso, the symbol “.” shall be substituted with the symbol “:”.
b. after the third proviso, the following proviso shall be inserted, namely,—
“Provided further that the Co-investment Portfolio Manager may designate a member of the Key Investment Team of the Manager as the principal officer who fulfils either of the criteria specified in clause (g) of regulation 4 of the Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012, and in that case the requirement under clause (d) shall not apply to the principal officer so appointed;”
ii. in sub-clause (ii) of clause (e),
a. in the second proviso, the symbol “;” shall be substituted with the symbol “:”.
b. after the second proviso, the following proviso shall be inserted, namely,—
“Provided further that the requirement under clause(e) above shall not apply to Co-investment Portfolio Manager;”
iii. in clause (g),
a. the symbol “;” shall be substituted with the symbol “:”.
b. the following proviso shall be inserted, namely,—
“Provided that the requirement under clause(g) shall not apply to the Coinvestment Portfolio Manager;”
III. In regulation 9,
i. The symbol “.” in the second proviso shall be substituted with the symbol “:”
ii. after the second proviso, the following proviso shall be inserted, namely,-
“Provided further that the requirement under this regulation shall not apply to the Coinvestment Portfolio Manager”.
IV. In regulation 11,
i. in clause (e),
a. the symbol “.” shall be substituted with the symbol “:”.
b. the following proviso shall be inserted, namely,—
“Provided that the requirement under clause(e) shall not apply to Co-investment Portfolio Manager.
V. In regulation 22,
i. in sub-regulation (2), the following provisos shall be inserted, namely,—
“Provided that in case of the Co-investment Portfolio Manager, the terms of co-investment in an investee company by a co-investor, shall not be more favourable than the terms of investment of the Alternative Investment Fund:
Provided further that in case of the Co-investment Portfolio Manager, the terms of exit from the Co-investment in an investee company including the timing of exit shall be identical to the terms applicable to that of exit of the Alternative Investment Fund:
Provided further that in case of the Co-investment Portfolio Manager, the early withdrawal of funds by the co-investors with respect to Co-investment in investee companies shall be allowed to the extent that the Alternative Investment Fund has also made an exit from respective investment in such investee companies.”
ii. in clause (e) of sub-regulation (4), after the first proviso, the following proviso shall be inserted, namely,—
“Provided further that the performance of the Co-investment Portfolio Manager shall be calculated in the manner as agreed between the Co-investment Portfolio Manager and the client:”
iii. in sub-regulation (6),
a. the symbol “.” shall be substituted with the symbol “:”.
b. the following proviso shall be inserted, namely,—
“Provided that the requirement under this sub-regulation shall not apply to Coinvestment Portfolio Manager.”
VI. In regulation 23,
i. in sub-regulation (2), after the second proviso, the following proviso shall be inserted, namely,—
“Provided further that the requirement of minimum investment amount per client shall not apply to the Co-investment Portfolio Manager:”
VII. In regulation 24,
i. in sub-regulation (1),
a. in clause (b), the symbol “.” shall be substituted with the symbol “:”.
b. after clause (b), following proviso shall be inserted, namely,—
“Provided that the requirement under clause (b) shall not apply to the Co-investment Portfolio Manager.”
ii. in clause (a) of sub-regulation (2)
a. the symbol “;” shall be substituted with the symbol “:”.
b. following proviso shall be inserted, namely,—
“Provided that clause(a) shall not apply in case of the Co-investment Portfolio Manager;”
iii. after sub-regulation (4A), the following sub-regulation shall be inserted, namely,-
“(4B) The Co-investment Portfolio Manager shall invest hundred percent of the assets under management in unlisted securities of investee companies where Category I and Category II Alternative Investment Funds managed by it as Manager, make investment;”
VIII. In regulation 26,
i. the symbol “.” in the proviso shall be substituted with the symbol “:”.
ii. after the first proviso, the following proviso shall be inserted, namely,—
“Provided further that this regulation shall not apply to a Co-investment Portfolio Manager”.
IX. In the proviso to sub-regulation (1) of regulation 34,
i. the symbol “.” shall be substituted with the symbol “:”
ii. after the first proviso, the following proviso shall be inserted, namely,—
“Provided further that in case of the Co-investment Portfolio Manager, the role of compliance officer may be assigned to the principal officer appointed in terms of clause (d) of sub-regulation (2) of regulation 7.”
X. FORM A of SCHEDULE 1 shall be substituted with the following, namely,-
Go To Form A at Page No. 19
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