The Securities and Exchange Board of India (Portfolio Managers) Regulations, 2020

Jan 23, 2020 | by Avantis RegTech Legal Research Team

Industry Specific Compliance

The Securities and Exchange Board of India (SEBI) on January 16, 2020, notifies the Securities and Exchange Board of India (Portfolio Managers) Regulations, 2020. The portfolio manager is a body corporate, who advises or directs or undertakes on behalf of the client (whether as a discretionary portfolio manager or otherwise) the management or administration of a portfolio of securities or goods or funds of the client and may deal in goods received in delivery against physical settlement of commodity derivatives. All portfolio manager must obtain a certificate of registration from the Board. The minimum net worth requirement of a portfolio managers is Rs. 5 crore. It must raise its net worth to not less than Rs. 5 crore within thirty-six months from the date from which the certificate of registration is granted by the Board.

The portfolio manager shall individually and independently manage the funds of each client in accordance with the needs of the client, in a manner which does not partake character of a Mutual Fund, whereas the non-discretionary portfolio manager shall manage the funds in accordance with the directions of the client. The portfolio manager shall not accept from the client, funds or securities worth less than Rs. 50 lakh. The money or securities accepted by the portfolio manager shall not be invested or managed by the portfolio manager except in terms of the agreement between the portfolio manager and the client and the renewal of portfolio on maturity of the initial period shall be deemed as a fresh placement.

These Regulations shall come into effect from January 21, 2020.

[Notification No. SEBI/LAD-NRO/GN/2020/03]


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