Login With Google
SEBI relaxes FPI rules
Why is it in the news ?
- The markets regulator SEBI eased the regulatory and compliance framework for foreign portfolio investors (FPI).
More in the news
- FPIs have been withdrawing from Indian equities after the finance minister introduced higher tax surcharge on the super-rich in the budget in July.
- In the past two months, FPIs have sold Indian shares worth $3.07 billion.
- Thus, SEBI has simplified the compliance and operational requirements for FPIs, to make the regulatory framework more investor friendly.
- New Changes:(1) SEBI decided to do away with the requirement that every FPI should have at least 20 investors- known as broad-based in regulatory parlance.(2) It simplified the KYC (or Know-Your-Customer) document requirement for overseas investors.(3) It has also allowed central banks of countries that are not members of Bank for International Settlement (BIS) to register as FPIs in India.(4) These central banks are “relatively long term, low risk investors directly/indirectly managed by the government.(5) SEBI has also permitted offshore funds floated by Indian asset management companies to register themselves as FPIs and invest in Indian markets.(6) SEBI also tightened regulations for credit rating agencies.
Source
The Hindu.