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Corporate Laws Central Ministry of Finance Securities and Exchange Board of India Act, 1992

Mandating additional disclosures by Foreign Portfolio Investors (FPIs) that fulfil certain objective criteria

24-Aug-2023 | SEBI/ HO/ AFD/ AFD-PoD-2/ CIR/ P/ 2023/ 148

Securities and Exchange Board of India (SEBI) has issued a circular mandating additional disclosures by Foreign Portfolio Investors (FPIs) that meet certain specific criteria. These additional disclosures are set to become effective from 1st November 2023. The circular outlines the criteria and requirements for these disclosures, as follows:

1. Criteria for Submission of Disclosures by FPIs: FPIs that fulfill any of the criteria mentioned in the circular are required to provide granular details of all entities holding ownership, economic interest, or exercising control in the FPI, up to the level of all natural persons, without any threshold. These details need to be submitted to the respective Designated Depository Participants (DDPs) in the format specified in the Standard Operating Procedure (SOP) referred to in the circular.

a. FPIs holding more than 50% of their Indian equity Assets Under Management (AUM) in a single Indian corporate group.
b. FPIs that individually or, along with their investor group (in accordance with Regulation 22(3) of the FPI Regulations), hold more than INR 25,000 crore of equity AUM in the Indian markets.

2. Exemption for Investor Groups: Investor groups that collectively hold more than INR 25,000 crore of equity AUM in the Indian markets will be exempt from making additional disclosures if the investor group includes FPIs that qualify for exemption based on any of the criteria mentioned earlier. However, this exemption is applicable only if the net equity AUM of the investor group, after deducting the AUM of the exempted FPIs, falls below INR 25,000 crore.

3. Timelines for Disclosures: FPIs whose investments continue to exceed the prescribed threshold after the expiry of the specified timelines must make the additional disclosures to their DDPs within 30 trading days from the expiration of those timelines.

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