Securities and Exchange Commission of India (SEBI) provides process for performing co-investment services through portfolio management
According to PMS Regulations, Portfolio Managers will not charge upfront fees
Capital markets regulator Sebi on Friday launched the process for implementing co-investment services through its portfolio management roadmap.
This comes after Sebi last month revised its rules regarding portfolio managers to make it easier for Alternative Investment Fund (AIF) investors to co-invest through portfolio management roadmap.
In a circular, the regulator said that AIF’s manager is also a registered portfolio manager and intends to provide co-investment services through the portfolio management route. investment, will only do so after prior communication with Sebi.
Furthermore, any other manager who is not a registered portfolio manager and wishes to offer co-investment services through the portfolio management route, will have to register Sebi as a How to be a portfolio manager.
Subject to the grant of the subscription, if such portfolio manager wishes to provide portfolio management services (PMS) other than co-investment, the same service shall be subject to all terms and conditions. clause of the PMS rule including eligibility criteria and with prior approval from Sebi.
For periodic reporting, the regulator said portfolio managers will have to submit a monthly report on their portfolio management’s performance, on the intermediary portal, within seven days. work at the end of each month.
This needs to be submitted in a revised format that includes co-investment details provided by the portfolio manager. Furthermore, portfolio managers will be required to provide reports to their clients quarterly, in a modified format that includes co-investment details provided by the portfolio manager.
The revised format reporting requirements will apply to monthly reporting for Sebi and quarterly reporting to clients, from April 2022 onwards. The regulator clarified that the provisions relating to fees and charges as well as the direct access to clients of portfolio managers set forth in the PMS rules will not apply to co-investment services.
These regulations will not change for portfolio management services that are not co-investment services, it added. Under the PMS Regulations, portfolio managers, directly or indirectly, will not charge clients upfront fees.
In addition, operating costs excluding brokerage fees, which are higher and higher than portfolio management service fees, will not exceed 0.50% per year on average daily client assets. managed (AUM). As a rule, at the time the customer directly boards the plane, there will not be any fees except the statutory fees.
