Financial markets regulator Securities and Exchange Board of India (SEBI) has relaxed timelines for disclosure of certain material changes or events by Foreign Portfolio Investors (FPIs).
It categorised material changes into two categories – Type I and Type II.
In the first case, the regulator said that material changes shall be informed by FPIs as soon as possible and within seven working-days of the occurrence of the change and the supporting documents (if any) shall be provided within 30 days of such change.
This category shall include critical material changes that render the FPI ineligible for registration; require FPI to seek fresh registration; render FPI ineligible to make fresh purchase of securities, among others.
In the second category, any material changes other than those considered as ‘Type I’, shall be informed and supporting documents (if any) shall be provided by FPIs as soon as possible and within 30 days of such change.
Presently, FPIs reportedly get up to seven working days to submit information in case of any material changes in it.
While relaxing timelines for disclosures, SEBI said that Designated Depository Participants (DDPs) shall examine all material changes informed by the FPIs and re-assess the eligibility of the FPI including requiring FPIs to seek fresh registration.
Where there is a delay in intimation of material change by the FPI to the DDP, the DDP shall, as soon as possible but not later than two working days, inform all such cases to SEBI for appropriate action, if any, along with reason for delay.
