Custodian appointment requires independent IFSC-based custody for specified schemes, subject to fund-of-funds and foreign-jurisdiction exceptions.

Fund management entities must appoint independent custodians for retail schemes, open-ended restricted schemes, and schemes managing assets above USD 70 million, subject to an exemption for fund-of-funds schemes whose underlying schemes have independent custodians. Custodians must generally be IFSC-based, although a regulated foreign custodian may be appointed where local issuance laws require it. Existing non-IFSC custodian arrangements must be transitioned to an IFSC-based custodian within twelve months of notification.

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