The Securities and Exchange Board of India (SEBI) on May 17, 2024, issued the Consultation paper on facilitating investments by Indian Mutual Funds in such overseas funds that invest a certain portion of their assets in Indian securities.
The following has been stated namely: -
• The objective of this consultation paper is to seek comments from the public on the proposal of facilitating investments by Indian Mutual Funds in such Overseas Mutual Funds (‘MFs’)/Unit Trusts (‘UTs’) that invest a certain portion of their assets in Indian securities.
• Comments are sought in respect of the following namely: -
o Whether the limit of 20% as mentioned in para 5.2 is appropriate?
o Whether passive schemes such as overseas ETFs, index funds etc. be excluded from the 20% exposure limit? If yes, whether Indian Mutual Funds should invest in such overseas passively managed funds which may have more than 20% exposure to Indian securities.
o Whether the proposals regarding additional criteria for investment in overseas MF/UTs having exposure to Indian securities at para 5.3 is appropriate?
o Whether the criteria for investment in overseas MF/UTs at para 5.3 should also include any specific parameter ensuring no concentration of investors in the underlying overseas MF/UTs?
o Whether the proposals regarding breach of limit at para 5.4 to 5.6 are appropriate?
o Whether the proposals regarding rebalancing of the portfolio at para 5.7 & 5.8 are appropriate?
o Whether the proposal regarding non-compliance at paragraph 5.9 is appropriate?
• The Comments are to be sent at https://www.sebi.gov.in/sebiweb/publiccommentv2/PublicCommentAction.do?doPublicComments=yes by June 07, 2024.The prescribed format should be followed.
