Regulatory framework for Specialized Investment Funds (SIF)
Summary
This circular establishes the regulatory framework for Specialized Investment Funds (SIFs) by amending the SEBI (Mutual Funds) Regulations, 1996. It outlines eligibility criteria for mutual funds to establish SIFs through either a sound track record or an alternate route involving specific fund management personnel. The document also mandates distinct branding and advertising requirements to ensure clear differentiation between SIFs and regular mutual fund offerings. Section 3 defines investment strategies for Specialized Investment Funds and permits specific equity, debt, and hybrid strategies. It details the characteristics, type of scheme, and redemption frequency for various long-short funds under equity and debt categories. The text concludes by introducing the section on Hybrid Investment Strategies. This section defines specific investment strategies for Active Asset Allocator and Hybrid Long-Short Funds, including their asset classes and exposure limits. It establishes a minimum investment threshold of INR 10 lakh for investors in Structured Investment Funds (SIFs), excluding accredited investors. The text further outlines restrictions on debt investments, rules for derivat
Text
This circular shall come into force with effect from April 01, 2025.
AMFI shall issue necessary guidelines/standards as required under this circular by March 31, 2025.
The Stock Exchanges, Clearing Corporations and Depositories are directed to take necessary steps and put in place necessary systems for the implementation of this circular; make necessary amendments to the relevant bye-laws, rules and regulations, wherever applicable, for the implementation of this circular; bring the provisions of this circular to the notice of market participants and also disseminate the same on their website.
This circular is issued in exercise of the powers conferred by Section 11(1) of the Securities and Exchange Board of India Act, 1992 read with Chapter VI-C of the SEBI (Mutual Funds) Regulations 1996 to protect the interest of investors in securities and to promote the development of, and to regulate the securities market.
A registered mutual fund may establish SIF, provided they meet the eligibility criteria under one of the following routes: Route 1 - Sound track record... Route 2 – Alternate route...
Mutual Fund has been in operation for a minimum period of 3 years and has an average asset under management (‘AUM’) of not less than INR 10,000 crores, in immediately preceding 3 years.
No action has been initiated or taken against the sponsor/asset management company (‘AMC’) under section 11, 11B, and/or Section 24 of the SEBI Act, 1992 during the last 3 years.
The AMC has appointed: A Chief Investment Officer (‘CIO’) for the SIF with an experience of fund management of at least 10 years and has managed an average AUM of not less than INR 5,000 crores
An additional Fund Manager for the SIF with experience of fund management of at least 3 years and has managed an average AUM of not less than INR 500 crores.
No action has been initiated or taken against the sponsor/AMC under section 11, 11B, and/or Section 24 of the SEBI Act, 1992 during the last 3 years.
A registered Mutual Fund shall file an application for prior approval with SEBI for establishment of an SIF, in the manner as may be specified by SEBI.
In order to clearly differentiate the Specialized Investment Fund and maintain brand integrity of its Mutual Fund business, AMCs shall ensure that the SIF has a distinct brand name and distinct logo, separate from that of its regular Mutual Fund.
You have read the preview. Create a free account to read the full document and see every order that applied it.
Free accounts include 10 searches/day with full text access.
Source: SecMarx — Regulatory framework for Specialized Investment Funds (SIF). Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.