New SEBI regulations for AIFs and MCX equities segment

New formed regulations that let the old VCF regulations and amendments expire apply a single set of Alternative Investment Fund regulations, at one shot extending pass thru taxation benefits to all classes of PE and ensuring all PE investors are registered in a single/multiple class before making investments. also the entire PE industry will be governed by the same set of regulations thru SEBI.

The vastly changed investment scenario has unfortunately also required that AIFs re-register before further investments can be solicited from customers. that finally makes available to you and me the fact that the recluse industry sector of financial services is raissing INR 260 mln at this cross section of time alone for India investments

Some complication still being faced by the industry have been addressed too as only 3 classes of investors are expected from the earlier nine divisions in which each strategy required a separate registration, while the minimum mandated investment of INR 1 crore or $200,000 (VCC) is hurting realty funds who have become used to getting more than half of their $1.5 bln in fund (INR 7500 crores) from ‘retail investors’ or partners (LPs) who garner only INR 3 mln to INR 5 mln each or $60k to $100k. 

AIFs can also be listed with each ‘share’ lot of value INR 1 crore or the minimum investment limit per LP. Though the minimu corpus for any fund has been reduced fromt he earlier $50 mln it is still INR 200 mln or $ 4 mln

Meanwhile, SEBI chastised by the recent high court ruling still gets to issue new rules and regulations according to an agreement with MCX before taking a call on its Equity segment application. For one the promoter investment limit of 5% will also go, while NSE may have to be removed from regulations where it is expressly named and or exchanges may not be treated as a national heritage property to allow a level playing field amidst multiple exchanges. 




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