MANU/SMFD/0007/2022

Ministry : Securities and Exchange Board of India

Department/Board : Investment Management Department

Circular No. : SEBI/HO/IMD/IMD-I/DOF6/P/CIR/2022/0000000037

Date : 28.03.2022

Notification/ Circulars Referred : Circular no. SEBI/HO/IMD/IMD-I/DOF6/P/CIR/2021/663 dated November 22, 2021 MANU/SMFD/0035/2021

Citing Reference:
Circular no. SEBI/HO/IMD/IMD-I/DOF6/P/CIR/2021/663 dated November 22, 2021 MANU/SMFD/0035/2021  Referred

To,

All Alternative Investment Funds (AIFs)

Sir/Madam,

Calculation of investment concentration norm for Category III AIFs

1. Regulation 15(1)(d) of SEBI (Alternative Investment Funds) Regulations, 2012 ("AIF Regulations"), has been amended and notified on March 16, 2022, to provide flexibility to Category III AIFs, including large value funds for accredited investors of Category III AIFs, to calculate investment concentration norm based either on investable funds or net asset value ("NAV") of the scheme while investing in listed equity of an investee company, subject to the conditions specified by the Board from time to time. Copy of the notification is available at link.

2. In this regard, the following is specified:

2.1. Existing Category III AIFs may opt for calculating investment concentration norm based on investable funds with the approval of their trustees or board of directors or designated partners, as the case may be, and inform the same to their investors within 30 days from the date of the issuance of this circular.

2.2. All Category III AIFs shall disclose the basis for calculation of investment concentration norm in the placement memorandum of their schemes.

2.3. The basis for calculating ........