Enclosure of Gazette Notification No. 686 dated July 30, 2002 pertaining to SEBI (Mutual Funds) (Third Amendment) Regulations, 2002
Summary
The Securities and Exchange Board of India (Mutual Funds) (Third Amendment) Regulations, 2002 were notified on July 30, 2002. These regulations amend the SEBI (Mutual Funds) Regulations, 1996 by modifying trustee meeting requirements and Net Asset Value discrepancy protocols. The amendments specifically mandate more frequent trustee meetings and establish compensation mechanisms for NAV calculation errors.
Text
These regulations may be called the Securities and Exchange Board of India (Mutual Funds) (Third Amendment) Regulations, 2002.
They shall come into force on the date of their publication in the official gazette.
The Trust Deed shall state that a meeting of the trustees shall be held atleast once in every two calendar months and atleast six such meetings shall be held in every year.
In clause 5, for the figure '2%' the figure ' 1%' shall be substituted.
In case the Net Asset Value of a scheme differs by more than 1%, due to non - recording of the transactions, the investors or scheme/s as the case may be, shall be paid the difference in amount.
If the investors are allotted units at a price higher than Net Asset Value or are given a price lower than Net Asset Value at the time of sale of their units, they shall be paid the difference in amount by the scheme.
If the investors are charged lower Net Asset Value at the time of purchase of their units or are given higher Net Asset Value at the time of sale of their units, asset management company shall pay the difference in amount to the scheme. The asset management company may recover the difference from the investors.
Source: SecMarx — Enclosure of Gazette Notification No. 686 dated July 30, 2002 pertaining to SEBI (Mutual Funds) (Third Amendment) Regulations, 2002. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.