What is Collective Investment Scheme (CIS) ?
It is governed by SEBI Act, Section 11A satisfies the following condition-
-The contributions, or payments made by the investors by whatever name called, are pooled and utilized solely for the purposes of the schemes or investment.
-Investors makes contribution to such schements or investments by the investors with a view to receive profits, income, produce or property, whether movable or immovable, from such scheme or arrangement.
-All investment related things like property , contribution and like wise which may be the part of investment scheme is managed on behalf of the Investors. -It has usually been seen that investors does not have control over day to day management and operation of the scheme or arrangement.
Scheme which does not constitute a Collective investment Scheme are as prescribed below-
1.Schemet that are offered by the the co-operative society or may be termed as arrangements .
2.Scheme which accepts deposits by Non Banking Financial Companies.
3.Contract Of Insurance in scheme or arrangements .
4.Scheme for pension framed under Employees provident Fund.
5.Deposits which is accepted under section 58A of the companies act, 1956 in any scheme or arrangement.
6.Any scheme or arrangement under which deposits are accepted by a company declared as Ni9dhi or Mutual Benefit Society.
7.Any scheme or arrangement falling within the meaning of chit business as Defined in clause (d) of section 2 of chit Fund Act, 1982.
8.Any contribution which is being made in respect to subscription to mutual funds .
Procedure to get registered with SEBI
2.Firstly any person who is thinking for starting a CIS company they have to fill an application and submit it to the board of registration in prescribed Form A along with the prescribed document and a Non-refundable fee provided in schedule 11 of the Regulation.
3.After receiving the Application, Board may accept the application or may reject it if the application will not be in conformity with the requirement specified in respective regulations. Before rejecting the application, an opportunity shall be given to the applicant for removing of the discrepancy within one and can be extended if there is good reason for condonation of delay.
4.The Board will see that whether the eligibility criteria of the Applicant is as per the Regulation or not.
5.Applicant must be registered as company under Companies Act, 1956 or as per Companies Act, 2013.
6.In MOA ,specific object of management of collective Investment should be there.
7.Net worth of the Company shall not be less than INR 5 crores.
8.Perfectly fine person to take care of grant of certificate .
9.An applicant should have adequate infrastructure to enable it to operate collective investment scheme in accordance with the provision of these regulations.
10.The Directors and key persons should be the person with honesty and integrity having adequate professional knowledge in related fields and should not be convicted of any offence.
11.At least 50 percent of the Directors of Company shall consist of person who are independent and are not directly or indirectly associated with the persons who have control over the Collective Investment management Scheme.
12.Once the Board is satisfied that the Company has passes all the above eligibility criteria, the applicant is intimated to pay the requisite fees. After recien-ving the fees, requisite grant of Incorporation certificate in Form-B.