INSUBCONTINENT EXCLUSIVE:
New Delhi: Markets regulator Sebi on Tuesday come out with a common application form for registration of foreign portfolio investors in
order to enhance operational flexibility and ease of access to Indian capital market.
Depository participants have been asked to continue to
accept in-transit FPI registration applications, for a period of 60 days, Securities and Exchange Board of India (Sebi) said in a
circular.
The regulator has come out with a Common Application Form (CAF) for registration of FPIs, allotment of Permanent Account Number
(PAN) and carrying out of Know Your Customer (KYC) for opening of bank and demat accounts.
The applicants seeking FPI registration need to
fill the common form prescribed by the regulator, declaration providing supporting documents and applicable fees for registration and
issuance of PAN.
"The other intermediaries dealing with FPIs may rely on the information in CAF for the purpose of KYC," it added.
With
regard to additional information, Sebi said that Category I FPIs (most well-regulated ones) have to apply for separate registration for the
purposes of hedging the offshore derivative instruments (ODIs) with derivatives as underlying in India as well as details of eligible
Category I entity.
Besides, information regarding 'Ultimate Beneficial Owner' for each fund that invests in India needs to be disclosed and
entities required to declare that they are not a bank or a subsidiary of a bank.
Earlier in September, the regulator had broad-based the
classification for foreign portfolio investors and simplified their registration process.
Under the new framework, FPIs have been classified
into two categories instead of three
Earlier, Sebi had classified FPIs into three categories with the easier compliance norms for Category-I FPIs and the strictest for
The most well-regulated FPIs come under Category-I.
As per the new rule, the government and government-related investors such as central
banks, sovereign wealth funds, international or multilateral organisations or agencies, including entities controlled or at least 75 per
cent directly or indirectly owned by such government and government related investor; pension and university funds would fall under the
Category-I FPIs.
Besides, appropriately regulated entities such as insurance or reinsurance entities, banks, asset management companies,
investment managers, investment advisors, portfolio managers, broker dealers and swap dealers will come under the Category-I.
Category-II
FPIs include all the investors not eligible under Category-I foreign portfolio investors such as endowments and foundations; charitable
organisations; corporate bodies; family offices; individuals; appropriately regulated entities investing on behalf of their client; and
unregulated funds in the form of limited partnership and trusts.