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On Monday, the investment advisers working in International Financial Services Centre got introduced to a new framework.
Highlights of the SEBI circular
a. Any company or a limited liability partnership or any other organization with a similar structure known under the law of its parent jurisdiction, interested in working as an investment adviser (IA), may form a company or LLP to provide investment advisory services.
b. Permission for a separate company or LLP won’t be given if the applicant is already a company or LLP in IFSC.
c. For every activity, the parent entity will fulfill the networth requirement independently.
d. Annual audit will be conducted by the entity to comply with investment adviser regulations and these guidelines from a chartered accountant from a company secretary.
e. The applicants mentioned in the IFSC guidelines and the only ones willing to register under the investment adviser norms are eligible to get services.
f. SEBI noted that while dealing with residents outside India and non-residents in India, the entity will ensure to follow the guidelines issued by the relevant overseas regulator/ authority.
g. In January, SEBI had set a rule that entities operating as investment advisers in IFSC needed to have a net worth of at least USD 1.5 million. There is a change to these guidelines now.
h. India’s IFSC is near Ahmedabad in Gujarat.