Registration of Mutual Funds with SEBI

Get your mutual fund registered with SEBI with help of BIATConsultant. We provide assistence in formation of mutual fund company , proving advisory on plan and risk management , assistece for 5 years and more
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What is Registration of Mutual Funds with SEBI

A mutual Fund is established as a Trust which has sponsors, Trustees, Asset Management Company, and custodian. Sponsors and trustees are there to work as a promoter of a company. And also trustees hold its property for the benefits of the unit holder.

Managing of funds is upon the Asset Management Company (AMC) which is duly approved by the SEBI for investing the funds in various securities. Custodian who is registered with SEBI holds the securities of various schemes of funds in its custody. Trustees look after the performance and compliance of SEBI Regulations by Mutual Funds.

An applicant who is willing or proposing to sponsor the Mutual Fund, he must fill the Form-A (First schedule of SEBI (Mutual Funds) regulations) along with the non-refundable fee of INR 5 Lacs.

Then the Application applied is further examined by the sponsors and after satisfaction of the eligibility criteria, it is duly passed from its further processing. After the satisfaction of Sponsors by eligibility criteria then remaining formalities for setting up a Mutual Fund is conducted, which includes inter alia, executing the Trust Deed and investment management agreement, setting up a Trustee company/ board of trustees comprising of two third independent trustees, incorporating the AMC, contributing to at least 40% of the net worth of AMC and appointing a custodian. Therefore after satisfied with these conditions, the registration certificate is issued subject to the payment of registration fees of INR 25 Lakhs.

Procedure for Registration of Mutual Fund with SEBI

Below are the following steps which an applicant has to take for the Registration of Mutual Fund with SEBI-

1)An application for registration of Mutual Fund shall be made to the board (SEBI) in form A by the sponsor along with the non-refundable fee of INR R Lakhs.

2)There is some eligibility criteria which applicant has to follow and they are as follows-
-The sponsor shall be carrying on business in financial services for a term not less than 5 years.
-The net worth should be positive in all immediately preceding 5 years.
-The net worth is immediately preceding year is more than capital contribution of sponsor in the asset management company.
-The sponsors has profits after providing for depreciation interest and tax in 3 out of the immediately preceding 5 years.
-The applicant is a fit and proper person.

3. In the case of an existing mutual funds then such form must be in the form of a trust deed or trust which has been approved by the SEBI.

4. The sponsors must have contributed at least 40% to the net worth of the asset management company.
Provided that, a person who his having more than 40% of the networth of the Asset management company, that person would be deemed as a sponsor and will be required to fulfill the eligibility criteria specified in regulations-

-The sponsors or any other Directors shall not be convicted of any offence, fraud or found guilty of any economic offence.
-Appointment of trustees is to be done to act as trustees for the mutual funds in accordance with the provisions of the regulations.
A-ppointment of asset management company for managing the funds of the company and such funds must be with accordance with the provisions of these regulations.
-Appointment of custodian is to be done in order to secure the securities or gold or any other security in their custody.

SEBI may grant registration certification on compliance or fulfilling of the above mentioned criterias in form B subject to the payment of registration fees of INR 25 Lakh.

FAQ

Common List Of Questioner That Our Customer Ask From Us -Solved !
What is Mutual Funds?
Mutual Funds is a mechanism for pooling money by issuing units to the investors and investing funds in securities in accordance with the objectives as disclosed in offer documents.
How is Mutual Funds Set Up?
A mutual Fund is established as a Trust which has sponsors, Trustees, Asset Management Company, and custodian. Sponsors and trustees are there to work as a promoter of a company. And also trustees hold its property for the benefits of the unit holder.
What is a Fund of Funds scheme?
A scheme that invests primarily in other schemes of the same mutual funds or other mutual funds is known as a FOF scheme.

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