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Easing the regulatory framework for foreign portfolio investors, SEBI has simplified KYC requirements for them and permitted them to carry out off-market transfer of securities.
Besides, the regulator has broad-based the classification for foreign portfolio investors (FPIs) and simplified their registration process.
The notification comes after the board of SEBI in August approved a proposal to simplify the regulatory norms for FPIs.
The new regulations have been redrafted based on the recommendation of a committee headed by former RBI Deputy Governor HR Khan.
Under the new framework, FPIs would be classified into two categories instead of three. At present, SEBI has classified FPIs into three categories with the easier compliance norms for Category-I FPIs and the strictest for Category-III FPIs. The most well-regulated FPIs come under Category-I.
As per the new rule, the government and government-related investors such as central banks, sovereign wealth funds, international or multilateral organisations or agencies including entities controlled or at least 75 per cent directly or indirectly owned by such government and government related investor; pension and university funds would fall under the Category-I FPIs.
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