DEPUTY GENERAL MANAGER
INVESTMENT MANAGEMENT DEPARTMENT
SEBI / IMD /
All Mutual Funds, Asset Management
Companies (AMCs)
and Association of Mutual Funds in
Sir /
Madam,
Sub: Modifications in the existing SEBI circulars
for Mutual Funds
In
terms of the provisions of Securities and Exchange Board of India Act, 1992,
read with the provisions of the SEBI (Mutual Funds) Regulations, 1996, SEBI has
issued various guidelines/circulars from time to time for compliance by Mutual Funds
and AMCs, the first such circular being issued in 1993
Over the years, certain circulars/ guidelines have
been revised in line with the requirements of investor protection, market
development or effective regulation. In continuation of the effort and in
consultation with
Besides
the modifications indicated in Annexure I, all other provisions of the
aforesaid SEBI circulars remain
unchanged, where applicable. These
modifications shall be applicable from the date of issue of this circular.
[
This circular is issued in
exercise of powers conferred under Section 11 (1) of the Securities and Exchange
Board of India Act, 1992, read with the provisions of Regulation 77 of the SEBI
(Mutual Funds) Regulations, 1996, to protect the interests of investors in
securities and to promote the development of, and to regulate the securities
market.
Yours faithfully,
Ruchi Chojer
Annexure I
1.
Payment of interest on delay in dispatch of
redemption or repurchase proceeds - SEBI Circular SEBI/ MFD/
After the second paragraph of the said circular, the
following shall be inserted –
“Sub-clause
(a) of Regulation 53 of SEBI (Mutual Funds) Regulations, 1996 requires Asset
Management Companies to dispatch dividend warrants within 30 days of the
declaration of the dividend.It is clarified that, in
the event of failure of dispatch of dividend within the stipulated 30 day
period, the
Below the format for statement of interest paid to
the investors for delays in despatch of redemption /
repurchase warrants, the following table shall be inserted. This statement shall be sent to SEBI alongwith the Compliance Test Report(s)
STATEMENT
OF INTEREST PAID TO THE INVESTORS FOR DELAYS IN DESPATCH OF DIVIDEND
|
Name
of |
Date
of Dividend Declaration |
Date
of Despatch |
Period
of |
Amount
of |
|
|
|
|
|
|
2.
Guidelines for participation by Mutual Funds in Stock
Lending Scheme - SEBI circular MFD/
Clause 2 – Valuation of collateral securities stands
deleted.
Accordingly, mutual funds are required to comply with
guidelines issued in this regard by SEBI/ Stock Exchange from time to time.
3.
Consolidation of schemes - SEBI Circular No.
SEBI/MFD/
Under ‘Maintenance of Records’, the following
shall be inserted at the end of the paragraph:
“……within 21 days from the date of closure
of the exit option”
4.
Launch of Additional Plan under existing schemes-
SEBI Circular No. MFD/
The provisions contained in SEBI Circular No. MFD/
[
5. Guidelines
for Investment/Trading in Securities by Employees of Asset Management Companies
& Mutual Fund Trustee Companies - SEBI Circular No. MFD/
The tenure of ‘10 calendar days’ as stipulated in Clause 1.5 under prior
approval of personal investment transactions shall be replaced with ‘7 calendar days’.
6. Guidelines
for Advertisement by Mutual Funds - SEBI Circular No. MFD/
a.
The
first paragraph under point (1) of Section
“This form of advertisement can only give
basic information about a
i.
Mutual fund registered with SEBI
whose Statement of Additional Information is filed with SEBI and has been
uploaded on its website; or
ii. Scheme which is already launched and is in existence and whose
Scheme information document is available.”
Accordingly, Point (2) under Section I – Applicability,
shall stand modified as under:
“Issue of advertisements or distribution of sales literature must be
accompanied or preceded by issue of
b. Use of Rankings in Advertisements and Sales Literature
Under para 3.7 (c) – Required
Disclosures, in clause (2) (G), “current standardized yield” shall be replaced
with “compounded annualized yield”.
Accordingly, under point (d) - Time Periods, para 2(c) on ‘current standardised
yield’ stands deleted
7. Performance
advertisement -SEBI
Circular No. MFD/
Regarding clause 4(ii) on
Performance of Money Market Schemes in SEBI
Circular No. SEBI/MFD/