Sebi Amends Norms for Mutual Funds to Deter Market Abuse
The Securities and Exchange Board of India (Sebi) has decided to amend norms governing mutual funds to strengthen the fight against market abuse. Asset management companies (AMCs) will now be required to implement an "institutional mechanism" for identifying and deterring potential market abuse, including front-running and fraudulent transactions in securities.
This mechanism should include enhanced surveillance systems, internal control procedures, and escalation processes to identify, monitor, and address specific types of misconduct. These include front running, insider trading, and misuse of sensitive information.
Sebi Provides Relief to Venture Capital Funds
Sebi has also addressed the concerns of venture capital funds (VCFs) registered under the erstwhile VCF norms. These funds faced challenges in fully liquidating investments within their scheme's tenure. The board has approved a proposal allowing such VCFs to migrate to AIF (Alternative Investment Fund) rules. This will enable them to avail the facilities available for AIFs to deal with unliquidated investments.
Sebi Allows Foreign Funds at GIFT City to Take Investments from NRIs
Sebi has permitted foreign funds set up at GIFT City in Gujarat to take full investment from non-resident Indians (NRIs) and other Indian-origin citizens. However, these funds will need to make detailed disclosures about their investors if the fund holds more than 33% of its equity assets under management in a single Indian group.