FPI threshold limit to make additional disclosures raised to Rs 50,000 crore in equity AUM: Sebi

Sebi on Monday approved a proposal to raise the threshold limit for foreign portfolio investors (FPIs) from the present Rs 25,000 crore of equity AUM in Indian markets to Rs 50,000 crore. "Thus, FPIs holding more than Rs 50,000 crore of equity AUM in the Indian markets will now be required to make additional disclosures as described," the capital market regulator stated in a release.

Any FPI holding more than 50 per cent of its equity AUM in a single corporate group is required to make disclosures under the additional disclosure framework, the Securities and Exchange Board of India also said. FPIs crossing this new limit must disclose ultimate ownership and control, the regulator added.

Sebi chief Tuhin Kanta Pandey said, "The average trading volume in the cash market has increased by 122 per cent. This size criteria is now being taken from Rs 25,000 crore to Rs 50,000 crore. But the concentration criteria remains the same, i.e. 50 per cent."

The market watchdog also eased norms for alternative investment funds (AIFs) to ease business constraints. "Investments in listed debt securities rated 'A' or below will now be treated like unlisted investments, helping AIFs meet compliance requirements," Sebi stated.

It also mentioned that public interest directors (PIDs) can be appointed without shareholder approval, but the regulator's nod remains mandatory. "Appointment, reappointment, or termination of Key Management Personnel (CO, CRiO, CTO, CISO) will need Governing Board approval (not just NRC approval as earlier)," Sebi underscored.

Further, the regulator revised the advance fee structure for Investment Advisers (IAs) and Research Analysts (RAs). "If the client agrees, IAs and RAs can now collect advance fees for up to one year (previous limit: 2 quarters for IAs, 1 quarter for RAs). These fee-related rules apply only to individual and HUF clients (non-accredited). Institutional clients and accredited investors will be governed by custom bilateral contracts," Sebi said.