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Introduction:

The rapid development and deployment of Artificial Intelligence (“AI”) and Machine Learning (“ML”) tools by market participants over the course of the past year prompted the Securities and Exchange Board of India (“SEBI”) to issue, on November 13, 2024, a consultation paper on “Proposed amendments with respect to assigning responsibility for the use of Artificial Intelligence Tools by Market Infrastructure Institutions, Registered Intermediaries and other persons regulated by SEBI” (“Draft Amendments”), seeking public suggestions on a series of amendments to the extant regulations.Continue Reading SEBI’s Proposed New Amendments on Usage of AI Tools by Regulated Entities

SEBI Prescribes Due Diligence Norms for AIFs to Curb Regulatory Circumvention

Introduction

A new set of regulations has been implemented for Alternative Investment Funds (“AIFs”) to exercise “specific due diligence”,[1] with respect to their investors. The aim is to prevent investors from circumventing the extant norms administered by the financial sector regulators. These include:Continue Reading SEBI Prescribes Due Diligence Norms for AIFs to Curb Regulatory Circumvention

SEBI Updates Framework for Overseas Investments by Alternative Investment Funds and Venture Capital Funds

The Securities and Exchange Board of India (“SEBI”) has updated the regulatory framework applicable to AIFs/ VCFs, seeking to make portfolio investments in offshore companies vide SEBI Circular dated August 17, 2022, titled ‘Guidelines for overseas investment by Alternative Investment Funds (AIFs)/ Venture Capital Funds (VCFs)’ (“SEBI Circular”). AIFs/ VCFs are currently permitted to make portfolio investments in equity and equity linked instruments of offshore venture capital undertakings[1], subject to taking case by case approval of SEBI for each such investment. Such approval is granted by SEBI to AIFs/ VCFs on a ‘first come first serve basis’, within an overall limit of USD 1,500 million.Continue Reading SEBI Updates Framework for Overseas Investments by Alternative Investment Funds and Venture Capital Funds

SEBI Changes to Scheme Circular - Is it a case of over-prescription

SEBI has been continuously streamlining the regulatory architecture governing schemes of arrangements under Sections 230-232 of the Companies Act, 2013 (“Companies Act”) and Regulations 11, 37 and 94 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR”) involving listed companies with the introduction of the SEBI Circular dated March 17, 2017 (“SEBI Scheme Circular”). SEBI vide its Circular dated November 3, 2020 (“Amendment Circular”), has introduced further changes to the SEBI Scheme Circular. The Amendment Circular is brought into effect for all schemes of arrangement submitted to the Stock Exchanges on or after November 17, 2020. Changes introduced under the Amendment Circular are as follows:
Continue Reading SEBI Changes to Scheme Circular: Is it a case of over-prescription?