SEBI Provides a Framework for Unit Based Employee Benefit Schemes for Employees of Investment Manager
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PR No. 8/2024; Dated: 30.04.2024
The Market Regulator SEBI, in its 205th board meeting on 30th April, 2024, approved a series of amendments around REITs and InvITs investments, venture capital (VC) funds, mutual funds, and market infrastructure institutions (MIIs). The key highlights of the meeting includes:
New Framework for Unit Based Employee Benefits in Investment Trusts
The board has notified amendments in SEBI (Infrastructure Investment Trusts) Regulations, 2014 and SEBI (Real Estate Investment Trusts) Regulations, 2014 in order to provide a framework for Unit-Based Employee Benefit Scheme. The Board approved the proposal to provide a framework for Unit Based Employee Benefit schemes (UBEB) for the employees of investment manager/manager of InvIT/REIT.
Venture Capital Funds (VCFs) Can Now Migrate to AIF Regulations
In response to challenges faced by Venture Capital Funds (VCFs) unable to fully liquidate investments within their scheme’s tenure, the Board has approved a proposal allowing these VCFs to migrate to Alternative Investment Fund (AIF) Regulations upon expiry of tenure.
SEBI’s Amendments to Non-Convertible Securities Regulations
These amendments aim to update several provisions related to financial disclosure in offer documents, record dates, due-diligence certification, and the reduction of face value for debt securities and Non-convertible Redeemable Preference Shares.
Issuers Permitted to Use Web Links and QR Codes for Audited Financials
In order to reduce the size of the offer document, the Board approved the proposal that issuers which have listed outstanding non-convertible securities as on the date of the offer document may be allowed to disclose audited financials for the last three years through insertion of a web-link and QR code in the offer document/ placement memorandum.
Enhanced Flexibility for Mutual Fund Investments in Group Companies of Sponsors
SEBI has approved an amendment to the SEBI (Mutual Funds) Regulations, 1996, allowing equity passive schemes to invest in group companies of sponsors up to the weightage of the constituents in the underlying index. This change, aimed at creating a level playing field for all Asset Management Companies (AMCs), includes an overall cap of 35% investment in sponsor group companies.
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