Clarification regarding amendment to SEBI (Portfolio Managers) Regulations, 2020
Summary
This circular clarifies the procedures for Portfolio Managers to offer co-investment services under the SEBI (Portfolio Managers) Regulations, 2021. It mandates specific reporting formats and timelines for monthly reports to SEBI and quarterly reports to clients regarding co-investment activities. Additionally, it exempts co-investment services from certain fee, charge, and client on-boarding provisions applicable to other portfolio management services.
Text
A Manager of an AIF who is also a SEBI registered Portfolio Manager, and intends to offer Co-investment services through portfolio management route, shall do so only under prior intimation to SEBI.
Any other Manager who is not a SEBI registered Portfolio Manager, and intends to offer Co-investment services through portfolio management route, shall seek registration from SEBI as a Portfolio Manager in terms of the PMS Regulations.
Pursuant to grant of registration, if such Portfolio Manager is desirous of offering portfolio management services other than Co-investment, the same shall be subject to compliance with all provisions of the PMS Regulations including eligibility criteria, and with the prior approval of SEBI.
Portfolio Managers shall submit a monthly report regarding their portfolio management activity, on SEBI Intermediaries Portal within 7 working days of the end of each month, as per the revised format enclosed at Annexure A, which includes details of Co-investment offered by Portfolio Manager.
Portfolio Managers shall furnish a report to their clients on a quarterly basis, as per the revised format enclosed at Annexure B, which includes details of Co-investment offered by Portfolio Manager.
The provisions with respect to fees and charges as specified therein, shall not be applicable to Co-investment services.
The provisions with respect to direct on-boarding of clients by Portfolio Managers as specified therein, shall not be applicable to Co-investment services.
The reporting requirements as per the revised formats mentioned at paragraph 2.2 of this Circular, shall be applicable for monthly reports to SEBI and quarterly reports to clients, from the month of April 2022 onwards.
This Circular is issued in exercise of powers conferred under Section 11(1) of the SEBI Act, 1992 read with the provisions of Regulation 43 of the SEBI (Portfolio Managers) Regulations, 2020, to protect the interest of investors in securities and to promote the development of, and to regulate the securities market.
Source: SecMarx — Clarification regarding amendment to SEBI (Portfolio Managers) Regulations, 2020. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.