SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/144

guidelines · 1992 · State unknown

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Parent: THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 (7c4c1f5343adab106c3a94cafc08a5ecf5957ae7)

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CIRCULAR SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/144 To All , Mutual Funds (MFs)/ Asset Management Companies (AMCs)/ Trustee Companies/ Board of Trustees of Mutual Funds/ Association of Mutual Funds in India (AMFI)/ Stock Exchanges Depositories Registrars to an Issue and Share Transfer Agent (RTAs) Madam/ Sir, Sub: Inclusion of Mutual Fund units in the SEBI (Prohibition of Insider Trading) Regulations , 2015 In order to strengthen the regulatory framework in relation to prohibition of insider trading in units of mutual funds, vide notification dated November 24, 2022 (link) , mutual funds units were included under the SEBI (Prohibition of Insider Trading) Regulations, 2015 (hereinafter referred to as 'PIT Regulations') . The amendments notified through the notification dated November 24, 2022 shall be applicable from November 01, 2024 (link to the Gazette notification) . In order to streamline the implementation of the above-mentioned amendments, a working group consisting of representatives from AMCs, AMFI, Stock Exchanges, RTAs and Depositories was constituted which provided its recommendations on implementation of the abovementioned amendments . After considering the recommendations of the working group, the following has been decided: 2.1. In terms of Regulation 5(E)(1) of PIT Regulations , AMCs shall disclose the details of the holdings of Designated Persons of AMCs , trustees and their immediate relatives on aggregate basis from November 1, 2024 on quarterly basis. The holdings as on October 31, 2024 shall be disclosed on the platform of the Stock Exchanges by November 15, 2024. Thereafter, for all subsequent calendar quarters AMCs shall provide the information within 10 calendar days from the end of the quarter . Further, the holdings shall be disclosed in the format sp

Rule TOC

2 · 1. In terms of Regulation 5(E)(1) of PIT Regulations , AMCs shall disclose the details of the holdings of Designated Persons of AMCs , trustees and their immediate relatives on aggregate basis from November 1, 2024 on quarterly basis. The holdings as on October 31, 2024 shall be disclosed on the platform of the Stock Exchanges by November 15, 2024. Thereafter, for all subsequent calendar quarters AMCs shall provide the information within 10 calendar days from the end of the quarter . Further, the holdings shall be disclosed in the format specified at Annexure A .

2 · 2. In terms of Regulation 5(E)(2) of PIT Regulations , details of all the transactions in the units of its own mutual funds, above the threshold amount which aggregates to a value in excess of INR 15 Lakhs, in one transaction or a series of transactions over any calendar quarter, per PAN across all schemes excluding the exempted schemes , executed by the Designated Persons of asset management company, trustees and their immediate relatives shall be reported by the concerned person to the Compliance Officer of AMC within two business days from the date of transaction.

2 · 3. In terms of Regulation 5(E)(3) and 5(E)(4) of PIT Regulations , the transactions reported under Regulation 5(E)(2) of PIT Regulations shall be disclosed in the format specified at Annexure B .

2 · 4. In terms of Clause 12 of Schedule B1 and Clause 11A of Schedule C of PIT Regulations, the observed violations of PIT Regulations shall be disclosed in the format specified at Annexure C .

3 · 1. Clause 6.6 of the Master Circular shall not be applicable for investments and redemption of mutual fund units. For mutual funds units, Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 , as amended from time to time , shall be followed strictly by the Trustees, Asset Management Companies and their employees and directors.

3 · 2. Clause 6.6.2.1 (a) of the Master Circular stands modified as under:

3 · 3. The following is inserted as Clause 6.6.2.1 (b)(4) in the Master Circular:

3 · 4. Clause 6.6.2.3(f) of the Master Circular stands modified as under:

3 · 5. Clause 6.6.4 of the Master Circular stands deleted.

5 · Action taken by asset management company/ Intermediary/ Fiduciary

6 · Reasons recorded in writing for taking action stated above

7 · Details of the previous instances of violations, if any, since

8 · If any amount collected for Code of Conduct violation(s)