SEBI has restored the original timeline for fund houses to launch NFOs, which was relaxed in view of covid-19 in March 2020.
Mutual funds will now have to launch NFO within six months of getting approval from SEBI. This is the original timeline prescribed in rules but it was relaxed to one year in view of covid-19 in March 2020.
"Based on consultation with stakeholders, it has been decided to restore the validity period of observation letter issued by SEBI to six months to launch NFOs," the regulator said in a circular issued on Wednesday.
The new timeline has come into effect from Wednesday. However, NFOs which have already received SEBI's go ahead can be launched within one year from the date of approval.
