SEBI has now specified the categories of FPIs that AMCs can provide management and advisory services to:
a. The FPIs can be government and government-related investors such as central banks, sovereign wealth funds, international or multilateral organizations or agencies. Here the government-related investors also include entities in which the government owns (directly or indirectly) at least 75% stake
b. The FPIs can also be appropriately regulated entities such as pension funds, insurance or reinsurance entities, banks and mutual funds
c. Appropriately regulated FPIs wherein the above-mentioned entities hold more than 50% of shares or units
The new norms have come into force with immediate effect for all AMCs.
However, SEBI has given a relaxation period to AMCs that already have an agreement to provide management and advisory services to FPIs that do not fall in any of the above categories. Such AMCs can continue to provide the services until December 16, 2020 or as mentioned in the agreement, whichever is earlier.
