CIRCULAR
CIR/ IMD/ FII&C/ 4/ 2012
January 25, 2012
All SEBI registered Intermediaries/ Recognized Stock
Exchanges/ Depositories
Sir / Madam,
Sub: Eligibility criteria for qualified depository
participant.
1) Vide SEBI circulars Cir/IMD/DF/14/2011
and Cir/IMD/FII&C/3/2012
dated August 09,2011 and January 13,
2012 respectively, Qualified Foreign Investors (QFI) were allowed to invest in
schemes of Indian mutual funds and Indian equity shares subject to terms and
conditions mentioned therein, including opening a demat account with qualified Depository
Participant. The eligibility criteria for a SEBI registered Depository Participant
(DP) to act as qualified Depository Participant were provided in the aforementioned
circulars.
2) On a review, it has
been decided to amend the eligibility criteria for a SEBI registered DP to act
as a qualified Depository Participant. The revised eligibility criteria to act
as qualified Depository Participants are as follows:
To become a qualified Depository
Participant, a SEBI registered DP shall fulfill the
following:
2.1. DP shall have net
worth of Rs. 50 crore or more;
2.2. DP shall be either a
clearing bank or clearing member of any of the clearing
corporations;
2.3. DP shall have
appropriate arrangements for receipt and remittance of money
with a designated Authorised Dealer (AD)
Category - I bank;
2.4. DP shall demonstrate
that it has systems and procedures to comply with the
FATF Standards, Prevention of Money Laundering
(PML) Act, Rules and SEBI
circulars issued from time to time; and
2.5. DP shall obtain prior
approval of SEBI before commencing the activities relating
to opening of accounts of QFI.
The eligibility criteria for qualified Depository Participant as
contained in SEBI circulars dated August 9, 2011 and January 13, 2012 stands
amended as above.
3) In order to maintain
consistency in the maximum retention period of QFI’s fund in the single rupee
pool bank account for investments/ re-investment out of redemption or dividend
in schemes of Indian mutual funds vis-à-vis equity shares, it has been decided
to amend clause(s) 4.7.5 and 4.7.7 of circular Cir/IMD/DF/14/2011 dated August
9, 2011.
4) Accordingly, the
maximum retention period of QFI’s funds in the single rupee pooled account with
the qualified depository participant as envisaged in clause(s) 4.7.5 and 4.7.7
of circular dated August 9, 2011 stands revised to five working days . (including
the date of receipt of foreign inward remittance through normal banking channels
from the designated overseas bank account of the QFI into the single rupee pool
bank account) for both investment as well as re-investment out of redemption
proceeds in schemes of Indian mutual funds.
5) Further, in partial
amendment to clause 4.7.8, it has been decided to allow credit of dividend
payments to QFIs on account of investment in schemes of Indian mutual funds
held by them to the single rupee pool bank account subject to the condition that
in case dividend payments are credited to the single rupee pool bank account,they
shall be remitted to the designated overseas bank accounts of the QFIs within five
working days (including the day of credit of such funds to the single rupee
poolbank account). Within these five working days, the dividend payments can be
also utilized for fresh purchases in schemes of Indian mutual funds, if so
instructed by the QFI
This circular is issued in exercise of powers conferred under
Section 11 (1) of the
Securities and Exchange Board of India Act, 1992, to protect the
interests of investors in securities and to promote the development of, and to
regulate the securities market .
Yours faithfully,
S MADHUSUDHANAN
Deputy General Manager
Tel No.: 022-26449614
Email:
smadhu@sebi.gov.in
No comments:
Post a Comment