SEBI Simplifies Requirements For Grant Of Accreditation To Investors Under AIF Regime

The Securities and Exchange Board of India on Friday simplified the process for granting accreditation to investors under the alternative investment fund framework.

Under this, investment managers are allowed to execute contribution agreements and complete related formalities based on their own assessment of an investor's eligibility, even if the investor has not yet received the formal accreditation certificate, the market regulator said in its circular.

However, the investor's commitment will not be counted towards the scheme's corpus until the accreditation certificate is issued, and the AIF can accept funds only after the investor becomes formally accredited.

Further, for accreditation based on net-worth criteria, SEBI has abolished the requirement to submit a detailed break-up of net worth. It is now optional for a chartered accountant to state the actual net worth, provided the certificate confirms that the prescribed threshold is met.

Trustees, sponsors and managers of AIFs will have to ensure that compliance with these changes is captured in the Compliance Test Report.

These revised norms are applicable with immediate effect, the Securities and Exchange Board of India said.

In August, SEBI's Whole Time Member Ananth Narayan G stated that the regulator proposed a new accredited investors-only AIF regime with lesser compliance rules, a move aimed at enabling sophisticated investors to back higher-risk ventures more efficiently.