SEBI has issued a circular today which states that AMCs will have to obtain a certification from a scrutinizer on the votes cast by them on behalf of unit holders. This certification has to be submitted to the trustees and also disclosed in the AMC annual report & website.
So far, AMCs were required to obtain auditor's certification on the voting reports disclosed by them on a quarterly basis.
The votes need to be certified by a scrutinizer under Companies (Management and Administration) Rules, 2014. This scrutiniser can be a chartered accountant, cost accountant, company secretary or an advocate.
SEBI has also asked the AMC Board and trustees to take an active role in making sure that AMCs vote on important decisions of their investee companies. “Board of AMCs and trustees of mutual funds shall be required to review and ensure that AMCs have voted on important decisions that may affect the interest of investors and the rationale recorded for vote decision is prudent and adequate. The confirmation to the same, along with any adverse comments made by the scrutinizer, shall have to be reported to SEBI in the half-yearly trustee reports,” states the SEBI circular.
SEBI has also asked AMCs to submit the soft copy along with printed scheme information document (SID) seven days before launching a scheme. Currently, AMCs submit SID to SEBI two days prior to launching a scheme.
The circular is applicable with immediate effect.
