The government has relaxed norms for fund managers managing offshore funds. The government has proposed to extend the timeline to meet minimum AUM requirement of Rs.100 crore from one month to 12 months.
In another relaxation, the government has segregated contribution of Indian investors and fund managers in the offshore funds. Currently, offshore fund managers are allowed to receive investment of up to 5% from Indian residents. This 5% also includes contribution from fund managers managing the fund. According to the proposed norms, the contribution of fund managers in the fund will not be a part of this 5% to an extent of Rs.25 crore for three years.
This will come into effect from April 1, 2020.
Many fund houses and AIF players garner foreign assets by advising foreign investors through PMS or by launching offshore funds based out of Mauritius, Singapore etc.