Offshore funds have 7 months to liquidate undisclosed holdings: Report
This comes after a regulatory requirement set by the market regulator last year, mandating offshore funds that have invested over 50 per cent of their assets under management (AUM) in a single group of companies and have more than Rs 25,000 crore in Indian equity markets to disclose their investors by January 29.
The Securities and Exchange Board of India (SEBI) has provided offshore funds and Foreign Portfolio Investors (FPIs) with an extension of seven months to liquidate undisclosed holdings. This decision comes as a measure to facilitate compliance with regulatory norms and allows these entities more time to align their portfolios with SEBI’s disclosure requirements.
In response to the challenges posed by the original deadline, SEBI has demonstrated a pragmatic approach by offering this extension. The move aims to provide offshore funds and FPIs with a reasonable timeframe to adjust their portfolios and ensure transparency per SEBI’s guidelines.
The disclosure norms set by SEBI play a crucial role in maintaining transparency and accountability within the financial markets. The extension acknowledges the complexities involved in restructuring portfolios and seeks to balance the need for compliance with the practical challenges faced by offshore funds and FPIs.
The additional seven months granted by SEBI afford these entities the flexibility to navigate market conditions, optimize their holdings, and meet regulatory requirements without undue pressure. This decision reflects SEBI’s commitment to fostering a regulatory environment that encourages compliance while considering the practicalities of implementation.
The financial markets, both domestic and international, often witness changes in regulatory frameworks to address evolving challenges. SEBI’s decision to extend the timeline for offshore funds and FPIs is a step towards creating a more adaptable and collaborative regulatory environment, fostering a balance between regulatory compliance and the operational realities faced by market participants.
In conclusion, SEBI’s decision to grant offshore funds and FPIs an additional seven months to liquidate undisclosed holdings aligns with the regulator’s commitment to pragmatic regulation. The extension acknowledges the complexities involved in portfolio adjustments and provides market participants with a reasonable timeframe to ensure compliance with SEBI’s disclosure norms. This move reflects a nuanced approach toward regulatory requirements, recognizing the need for flexibility in the ever-changing landscape of financial markets.
