Securities and Exchange Board of India (Mutual Funds) (Amendment) Regulations, 2020

Mar 11, 2020 | by Avantis RegTech Legal Research Team


Industry Specific Compliance

The Securities and Exchange Board of India (SEBI) on March 06, 2020, notifies the Securities and Exchange Board of India (Mutual Funds) (Amendment) Regulations, 2020 to further amend the SEBI (Mutual Funds) Regulations, 1996.

The followings are the amendments made under the SEBI (Mutual Funds) Regulations, 1996:-

 In Regulation 26 related to “Appointment of custodian”, the proviso has been substituted stating that the mutual fund shall appoint a Custodian to carry out the custodial services for the schemes of the fund and sent intimation of the same to the Board within 15 days of the appointment of the Custodian, provided that in case of a gold exchange traded fund scheme, the assets of the scheme being gold or gold related instruments may be kept in the custody of a custodian registered with the Board”.

 The Regulation 28(4) related to “Procedure for launching of schemes” has been substituted, stating that the sponsor or asset management company shall invest not less than 1% of the amount which would be raised in the new fund offer or Rs. 50 lakh, whichever is less, and such investment shall not be redeemed unless the scheme is wound up. The investment by the sponsor or asset management company shall be made in such option of the scheme, as may be specified by the Board.

This Notification shall come into force on the date of its publication in the Official Gazette that is March 09, 2020.

[Notification No. SEBI/LAD/NRO/GN/2020/07]


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