The Securities and Exchange Board of India (SEBI) on September 09, 2020 has issued a circular for the operating guidelines for portfolio managers in International Financial Service Centres (IFSC). These guidelines shall be applicable to all the portfolio managers operating or setting up in IFSC.
Registration of Portfolio Managers:
• An application shall be filed by the portfolio managers along with the prescribed fees.
• A SEBI registered intermediary may provide portfolio management services if they fulfil the following criteria:
1. Manpower shall be allocated for the portfolio management.
2. Operating guidelines shall be adhered to strictly.
3. The parent entity shall ensure that the domestic operations and international operations are happening according to the legal guidelines.
• Any other entity having its jurisdiction in India and is interested in getting involved in IFSC can perform the operations.
• If the criteria are fulfilled appropriately, the application shall be approved, and a certificate shall be provided to them.
Operational Compliances:
• All the resident outside India shall obtain a certificate from any other organization or institution in India which is accredited by the Financial Market regulator in that foreign jurisdiction.
• NISM certificate shall be mandatory for all.
• Applicants shall not have net worth less than USD 750,000.
• If the operations are being carried out by the subsidiary, then the net worth requirements shall be fulfilled by the subsidiary.
• Portfolio managers operating in IFSC shall not accept funds or securities from the client having net worth of less than USD 70,000.
• These funds shall be maintained in a separate account regulated by the RBI.
• The amount for registration for grant of certificate shall be USD 15,000 and for the application it shall be USD 1,500. Registration fee for three years for the grant of certificate shall be USD 7,500.
[Circular No. SEBI/HO/IMD/DF1/CIR/P/2020/169]
