Sebi Notifies Rules to Strengthen Regulatory Framework for CIS

Securities and Exchange board of India

Collective investment schemes, the Securities and Exchange board of India (Sebi) has modified the provisions of the Capital Market Information System (CIS) regulations.

The market regulator has market regulator has enhanced the net worth criteria and track record requirements for entities managing such schemes. According to the new regulations, a minimum of 20 investors will be required to participate in a collective investment scheme (CIS) with a subscription amount of at least 20 crores.

The regulator has also imposed a cap on the cross-shareholding in a collective investment management company (CIMCs) to prevent conflicts of interest.

Also Read | Sebi Revises Operational Guidelines for FPIs, Depository Participants

As per the new rules, CIMCs are required to have a minimum net worth of Rs 50 crore as compared to the present requirement of Rs 5 crore.

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