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SEBI has revised AIF norms in which it has asked AIFs to excuse or exclude an investor from participating in a particular investment if it is in violation of an applicable law or regulation.
SEBI said, “An AIF may excuse its investor from participating in a particular investment if the investor confirms that its participation in the investment opportunity would be in violation of an applicable law or regulation.”
Investors may also excuse if their participation is in contravention to the internal policy.
The AIF manager can also excuse an investment opportunity on their own if it is violation of applicable law or regulation and would result in adverse effect on the scheme, clarified the market regulator. However, AIFs will have to cite reason for such a call along with supporting document, said the market regulator.
Bhavik Thakkar, CEO, Abans Investment Managers feels that the move will benefit a particular section of investors. He said, “The new guidelines will take care of ethical standards related to investments. This will attract more investors who do not invest due to internal policies or laws.”
Hemant Daga, CEO - Neo Asset Management said that the move will increase transparency and enhance reporting standards.
