Brief Overview:
IFSCA fund management framework has been revised to introduce better operational flexibility for fund management entities (FME), enhanced clarity in scheme lifecycle processes, and improved investor safeguards.
Technical Details:
Key Highlights
1) Broader definition of “eligible institutions” and revised experience requirements.
(a) 2 years’ post qualification experience → KMPs in addition to the principal officer for Registered FME; and
(b) 3 years’ post qualification experience → KMPs including compliance officers, additional fund‑management KMPs for Retail FMEs or FMEs with AUM ≥ USD 1 billion.
2) Placement memorandum validity extension allowed multiple times, with graded fees of 25% for first time and 50% for subsequent extensions.
3) Open‑ended schemes can invest in unlisted securities only after achieving USD 3 million minimum corpus.
4) Additional extension mechanism introduced for schemes failing to achieve USD 3 million corpus.
5) New winding‑up grounds now cover failure to achieve minimum corpus within validity and voluntary closure when no investors are onboarded.
6) Timeline for appointing a custodian extended to 24 months.
Takeaways:
The relaxations under the 2026 amendments allow greater flexibility in meeting corpus requirements and strengthening the protections for open ended schemes. The amendments enhance ease of doing business while also bolstering investor protection.
For further details, please see:
IFSC Fund Management (Amendment) Regulations 2026
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