SRO will regulate mutual fund distributors.
Market regulator SEBI has invited applications for those who wish to become self-regulatory organization (SRO) for mutual fund distributors.
“Applications are invited from any group or association of intermediaries which are desirous of being recognized as a Self-Regulatory Organization in terms of SEBI (Self-Regulatory Organizations) Regulations, 2004 for distributors of mutual fund products by making an application as prescribed in the said Regulations,” states a SEBI’s invitation proposal.
According to SEBI rules, any group or association of intermediaries, which wants to become a SRO has to form a company registered under section 25 of the Companies Act, 1956.
The idea to set up an SRO was floated in the SEBI concept paper released in 2011.
“The SRO formed to regulate investment advisors will be registered under the SEBI (Self-Regulatory Organization) Regulations, 2004. SRO will have sufficient resources to perform its functions. Its duties would include registering and setting minimum professional standards, including certification of investment advisors, laying down rules and regulations and enforcing those; informing and educating the investing public;setting up and administering a disputes resolution forum for investors and registered entities etc. Persons desirous of registration as Investment Advisors shall obtain registration with the SRO established for the purpose. The SRO will be entitled to charge a fee for granting registration and an annual fee,” stated the concept paper released in 2011.
Read the SEBI notification on SRO here.
Read SEBI’s SRO application invite proposal here.
