The Association of Mutual Funds in India (AMFI) on September 08, 2023, issued a notification regarding the continuous monitoring of fit and proper status of major shareholders pursuant to RBI Master Direction.
The following has been stated: -
•This has reference to the requirement for continuous monitoring of the fit and proper status of entities that are major shareholders/ have applied for being major shareholders of banking companies as mandated by the Reserve Bank of India (Acquisition and Holding of Shares or Voting Rights in Banking Companies) Directions, 2023 dated January 16, 2023.
•It is understood from the provisions of the aforementioned RBI Master Direction that responsibility has now been cast on the banking companies to obtain information to conduct requisite due diligence so as to ascertain whether the major shareholders/ applicants continue to be "fit and proper".
•Apropos to the requirement, requests are being received from banking companies, seeking information on actions taken by SEBI, impending action, matter, or observation if any against the entities registered with SEBI that are major shareholders or have applied for being major shareholders in the corresponding banking companies.
•In this regard, it may please be noted that –
a)Details of actions taken by SEBI (against the entities registered with SEBI), which have a bearing on the determination of "fit and proper" person criteria are available on the SEBI website which, inter-alia, include directions under Section (B) of SEBI Act, 1992. The same can be accessed by the banking companies for the purpose of continuous monitoring.
b)As per the extant practice, impending proceedings/ investigations conducted by SEBI on the entities registered with SEBI are shared only on a Regulator-to-regulator basis. Accordingly, such information (sought by banks) cannot be provided by SEBI to the concerned banks.
The detailed notification is given in the document attached below.
