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Tuesday, Dec 03, 2002

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AMFI registration mandatory for intermediaries

K.R. Srivats


INTERMEDIARIES engaged in selling and marketing of mutual funds units would have to register themselves with the Association of Mutual Funds in India (AMFI) by March 31, 2003.

This directive of the Securities and Exchange Board of India (SEBI) is aimed at imparting professionalism in the functioning of intermediaries in the mutual funds industry.

For registration, the intermediaries, which includes distributors, agents, brokers, sub-brokers, whether individuals or any other organisation structure, should pass the AMFI certification examination.

Distributors and agents of mutual funds are already required to follow the code of conduct recommended by AMFI.

SEBI has, however, exempted senior citizens having experience in distribution of mutual funds units from the certification examination. Such intermediaries should have completed 60 years of age as on March 31, 2003, and have two years of experience.

They would have to comply with SEBI and AMFI Guidelines and also be registered with AMFI.

Such intermediaries would have to attend a mutual fund training programme within one year from March 31, 2003, and a certificate to that effect endorsed by a mutual fund should be submitted to AMFI, according to a circular issued by SEBI.

The capital markets regulator has also ruled that the empanelment of intermediaries with mutual funds and payment of commissions, brokerage/sub-brokerage, etc. would have to be in accordance with parameters and guidelines specified by SEBI and AMFI from time to time.

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