IFSCA Bars Multiple Fiduciary Roles in Same Scheme
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- Last Updated on 1 September, 2026
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Circular F. No. IFSCA-IF-10PR/7/2024-Capital Markets/10042026, Dated 10.04.2026
The International Financial Services Centres Authority (IFSCA) has issued a clarification on governance of schemes in IFSCs, mandating strict segregation of fiduciary roles to strengthen oversight and prevent conflicts of interest.
1. Segregation of Fiduciary Functions
The clarification provides that:
- Fund Management Entities (FMEs) shall not appoint the same fiduciary to perform multiple roles for a single scheme
- Specifically, a fiduciary cannot simultaneously provide:
-
- Fund administration
- Valuation services
- Audit services
- Financing services
2. Objective of the Clarification
The measure aims to:
- Prevent conflict of interest
- Ensure independent functioning of key service providers
- Strengthen governance and investor protection
3. Compliance Requirement for Existing Schemes
- Existing schemes must align with the new requirements
- The deadline for compliance is 30th September 2026
4. Regulatory Impact
The clarification ensures:
- Greater transparency and accountability
- Improved checks and balances in fund operations
- Enhanced trust in IFSC fund structures
5. Conclusion
This clarification reinforces IFSCA’s focus on robust governance standards, ensuring that fiduciary roles remain independent and conflict-free, thereby safeguarding investor interests in IFSC schemes.
Click Here To Read The Full Circular
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