SEBI Enhances Disclosure Norms Strengthening the ‘General Obligations & Responsibilities’ of FPIs

Notification No. SEBI/LAD-NRO/GN/2023/143., Dated: 10.08.2023

SEBI has notified an amendment to the SEBI (Foreign Portfolio Investors) Regulations, 2019. New sub-regulation 6 and 7 have been introduced in Regulation 22 which pertains to general obligations & responsibilities of Foreign Portfolio Investors (FPIs).

Now, an FPI that fulfils the criteria specified by the Board, is required to provide information or documents in relation to persons with any ownership, economic interest or control, in the FPIs.

Further, Regulation 4 which pertains to the eligibility criteria for Foreign Portfolio Investors has been amended. Under the previous norms, the applicant or its underlying investors contributing 25% or more to the corpus of the applicant or identified based on control, were not considered as persons mentioned in the Sanctions List notified by the United Nations.

Now, instead of the current limits of 25%, compliance must be ensured with the threshold prescribed under Rule 9 of the PML (Maintenance of Records) Rules, 2005.

SEBI’s amendment boosts transparency with mandatory ownership disclosure and revised eligibility criteria for FPIs. This strengthens regulatory harmony and accountability.

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