The Securities and Exchange Board of India (“SEBI”) has recently issued a Circular on Alternative Investment Funds (“AIF”) and Venture Capital Funds (“VCF”). By virtue of this circular, SEBI enhances the limits of overseas investment by AIFs and VCFs to USD 750 million. This circular is effective 2nd July 2018.
Background
SEBI had previously notified the SEBI (Alternative Investment Funds) Regulation, 2012 (“AIF Regulations”) on 21st May 2012. The AIF Regulations had repealed and replaced the SEBI (Venture Capital Funds) Regulations, 1996. Also, SEBI had allowed overseas investment by AIFs and VCFs to the extent of USD 500 million.
In order to monitor utilization of overseas investment limits, SEBI has decided that the AIFs and VCFs must mandatorily adhere to the following:
- Report the utilization of overseas limits within 5 working days of such utilization on the SEBI Intermediary portal at https://siportal.sebi.gov.in.
- AIFs and VCFs are required to report the following on the SEBI Intermediary Portal:
- In case overseas limits granted are not utilized within 6 months from the date of SEBI approval (“Validity Period”), the same should be reported within 2 working days of expiry of the validity period.
- In case a part of the overseas limit granted is not used, the same should be reported within 2 working days of expiry of validity period.
- In case an AIF or VCF intends to surrender the overseas limit granted at any point of time within the validity period, the same should be reported within 2 working days from the date of decision to surrender the limit.
For further details, please refer to the hyperlink below.
Source: Securities and Exchange Board of India
