SEBI Sets up two separate panels to review ownership norms of Sponsor and Trustees

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SEBI Sets up two separate panels to review ownership norms of Sponsor and Trustees

  • The Securities and Exchange Board of India (SEBI) has set up two separate Expert Groups to examine the roles, eligibility criteria and functions of sponsors and trustees at asset management companies (AMCs).
  • A sponsor is like a promoter who brings in the capital for setting up an AMC.
  • Trustee plays a supervisory role and is tasked with protecting investors interest.

Working Group on Sponsors

  • The working group on Sponsors will be chaired by Balasubramanian, MD & CEO, Aditya Birla Sun Life AMC.

Terms of reference:

  • to recommend mechanisms for addressing conflict of interest that may arise if pooled investment vehicles/ private equity act as sponsor;
  • to examine the need for sponsor to dilute its stake in asset management company from the existing requirement of holding at least 40 percent of the net worth and the alternative pathways that may be adopted by the sponsors in this regard.

Working Group on MF Trustees

  • The working group on MF trustees will be chaired by Manoj Vaish, Independent Trustee, Mirae MF.

Terms of reference:

  • To determine whether certain obligations of operational nature can be delegated to AMC;
  • to identify those responsibilities for which trustees can avail the services of professional assurance agencies;
  • to recommend required financial resources to be made available to trustees to independently discharge their obligations.”

Source: Business Standard

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