• UGI USER
  • Nov 26, 2023
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SEBI APPROVES RULES FOR INDEX PROVIDERS

Why in the News?

  • SEBI introduces a regulatory framework for Index Providers to enhance transparency and governance in financial benchmarks.
  • The regulations focus on the registration of Index Providers licensing ‘Significant Indices’ based on objective criteria.

AIF Investment and Custodianship

  • SEBI amends rules for Alternative Investment Funds (AIFs) to encourage compliance and bolster investor protection.
  • AIFs making fresh investments beyond September 2024 must hold them in dematerialized form.
  • AIFs are now allowed to appoint a custodian, even if associated with the AIF, subject to SEBI-prescribed conditions.

Amendments to REIT Regulations:

  • SEBI approves amendments to Real Estate Investment Trusts (REITs) Regulations, 2014.
  • Introduces a regulatory framework for Small & Medium REITs (SM REITs) with a minimum asset value of ₹50 crore.
  • SM REITs gain flexibility to create separate schemes for real estate assets through special purpose vehicles (SPVs).

Social Stock Exchange (SSE) Flexibility

  • SEBI grants flexibility in the framework for Social Stock Exchange (SSE) to boost fundraising by Not for Profit Organizations (NPOs).
  • Changes the nomenclature from “Social Auditor” to “Social Impact Assessor” to convey a positive approach towards the social sector.

Cost of Compliance and Investor Protection:

  • The Board notes an average cost of compliance under the custodial

services mandate at approximately ₹88,000 per annum.

  • Amendments aim to streamline fundraising and enhance the administration of financial indices, aligning with global standards.

SEBI’s moves reflect a strategic approach to regulation, aiming to balance transparency, investor protection, and ease of compliance in various financial domains.