Dissolution period for AIF schemes requires filing an information memorandum and merchant banker due diligence, with investor approval.
SEBI permits AIF schemes to opt for a dissolution period for unliquidated investments, requiring submission of an information memorandum to SEBI via a merchant banker before the expiry of the liquidation or additional liquidation period; the merchant banker must furnish a Due Diligence Certificate confirming compliance with Regulation 29 and adequacy of disclosures. Schemes seeking an additional liquidation period must submit prescribed information for SEBI consideration. In specie distributions (other than mandatory distributions) require approval of at least seventy five percent of investors by value. Managers, trustees/sponsors and key personnel are responsible for compliance and inclusion of these matters in the Compliance Test Report.

Exposure cap for sponsor group securities: passive ETFs and index funds follow index weight, subject to cap and rebalancing rules.
Equity oriented ETFs and Index Funds tracking widely tracked, non bespoke indices may invest in group company securities in accordance with index weight subject to an overall exposure cap. Eligible indices are determined by an AUM threshold and listed semi annually by AMFI after approval. Passive schemes tracking indices outside the eligible list must rebalance within the prescribed timeframe; the AMC's Investment Committee may extend that period for limited time upon written justification. Failure to rebalance within mandated timelines bars new scheme launches and prohibits levy of exit load on exiting investors until compliance.

Filing deadline extension to October 31 for brokers and depository participants, requiring exchanges to notify and amend rules.
SEBI has extended the compliance timeline so that failure to furnish annual audited accounts by stock brokers and net worth certificates by depository participants (for year ending March 31) will be judged against an October 31 deadline; the change is effective immediately and exchanges/depositories must notify members, amend bye laws and report implementation in Monthly Development Reports.

Brokers' institutional mechanism for fraud prevention mandated with staggered risk-based implementation across broker categories and ISF standards.
Requires stock brokers to implement an institutional mechanism for prevention and detection of fraud or market abuse, comprising systems for surveillance and internal controls, broker and employee obligations, escalation and reporting, and a Whistle Blower Policy; the ISF, with SEBI, will frame implementation standards; stock exchanges must notify brokers, amend rules, issue applicability notices, mandate adoption of ISF standards, and report implementation status to SEBI.

Timelines for CRA rating communication and appeals set prompt communication, appeal windows, and press release dissemination requirements.
Specific timelines require CRAs to communicate ratings to issuers promptly after rating committee meetings, allow issuers a short window to request review or appeal following periodic surveillance, and mandate dissemination of press releases and intimation to stock exchanges or debenture trustees within a prescribed period. CRAs must maintain an archive of all disclosures for ten years, while certain specified disclosures are published for shorter prescribed periods; records must be retained for ten years and issuer specific press releases/rating rationales made available on CRA websites.

Reduction in denomination of debt securities expands retail access; permits smaller private placements with prescribed safeguards.
Issuers may offer debt securities and non-convertible redeemable preference shares on private placement at a face value of Rs. Ten Thousand if they appoint at least one Merchant Banker, issue interest/dividend-bearing instruments with fixed maturity and no structured obligations, and, where applicable, employ permitted credit enhancements. Credit Rating Agencies must verify that support is unconditional, irrevocable and legally enforceable and that the support provider has a lower probability of default than the issuer. Trading lots shall equal face value and the amendments apply to private placement issues proposed to be listed from the circular's issuance.

True to Label charges require market infrastructure institutions to ensure uniform, transparent pass-through of client charges.
MIIs must ensure charges recovered from end clients are True to Label, meaning the exact amount levied on the client is received by the MII. Slab-wise, volume-dependent charge structures that enable members to collect aggregated sums exceeding the MII's receivable must be replaced with a uniform, equal charge structure for all members. MIIs are directed to redesign charge structures, implement requisite infrastructure and by-law amendments, notify and publish provisions to members, and report implementation status to the regulator.

Default email dispatch for consolidated account statements makes electronic delivery primary while preserving opt in physical option.
The circular mandates email as the default mode of dispatch for Consolidated Account Statements and DP holding statements, using registered email addresses held by Depositories and AMCs/MF-RTAs, while preserving investor choice to opt for physical delivery. It prescribes monthly email CAS when transactions occur, half yearly email CAS where there are no transactions, and annual or half yearly email holding statements for various account activity scenarios. Depositories must amend rules, implement system changes, notify investors quarterly by SMS of the email used, publish the circular and report implementation status; DPs must furnish electronic statements under digital signature or provide physical statements if unable.

Basic Services Demat Account eligibility and mandatory conversion rules to promote financial inclusion and simplified charges.
The circular requires eligible individuals who have or propose only one demat account as sole or first holder and only one BSDA across depositories, with holdings within the prescribed threshold, to be offered BSDA. DPs must open BSDA for such eligible BOs and periodically reassess and convert existing eligible accounts into BSDA unless BOs give authenticated consent for a regular account. A simplified annual maintenance charge regime applies based on holdings, DPs must determine holdings value by specified market/pricing methods, and BSDA receives free electronic statements with limited fees for physical statements.

Mutual fund regulation updated: consolidated master circular sets filing, product, risk, ESG and ETF operational rules industry-wide.
The Master Circular consolidates mutual fund circulars up to March 31, 2024, superseding prior Master Circulars and rescinding specified earlier circulars while preserving prior actions; prescribes unified filing formats, timelines and disclosure requirements for SID/KIM/SAI, scheme categorisation and standardised characteristics for equity, debt, hybrid and other schemes, product-specific norms (Gold/Silver ETFs, FoFs, ESG schemes), a mandatory Risk Management Framework, stress testing and in-house credit assessment, rules for segregated portfolios on credit events, liquidity prudential norms, cyber resilience obligations, and ETF/index fund operational, tracking and market-making standards.

Aggregate contribution by NRIs, OCIs and resident Indians in IFSC based FPIs allowed subject to declaration, documentation and structural safeguards.
SEBI permits IFSC based FPIs regulated by IFSCA to accept aggregate contributions by NRIs, OCIs and RI individuals of fifty per cent or more subject to conditions: a registration declaration to the DDP, submission of PAN or prescribed declarations and identity documents for individual constituents (with look through disclosure for non individuals controlled or significantly owned by such individuals), classification of changes as Type II material changes, and an exemption pathway for IFSC funds meeting pooling, pari passu/pro rata, diversification and investor mix requirements with remedial cure periods for breaches.

Statutory committee composition rules for market infrastructure institutions strengthened to require public interest directors majority and PID-led chairs.
Revised governance requires MIIs to maintain specified statutory committees (MC, NRC, SCOT, ROC, RMC, IC) with Chairs as Public Interest Directors (PIDs), PIDs at least equalling other members in number (SCOT excluding IEPs), and voting validated only when PIDs who vote are not fewer than other members voting. Core TORs are non delegable; MC may delegate certain operational tasks to Internal Committees under defined SOPs while retaining accountability. Committees must adopt SOPs, manage sector specific oversight (technology, risk, surveillance, member admission, regulatory enforcement, investments), and ensure independent IEPs and required PID availability.

Electronic Gold Receipts as securities: creation, trading and conversion governed under a SEBI master framework ensuring vault, depository and risk controls.
SEBI's Master Circular establishes EGRs as tradable securities with a three tranche lifecycle: creation by registered Vault Managers upon deposit of qualifying gold and recording in a common depository interface; continuous trading on stock exchange segments with clearing by Clearing Corporations; and conversion/extinguishment permitting withdrawal of physical gold subject to verification, reconciliation, and assayer procedures. Vault Managers and Depositories must meet specified vault, security, insurance, reconciliation, disclosure and grievance redressal obligations, while a comprehensive margins and settlement framework governs risk management and T+1 rolling settlement.

System audit requirement for Professional Clearing Members mandates annual IT audits and timely submission of audit reports.
The circular mandates annual System Audits for Professional Clearing Members (PCMs) under the prescribed System Audit Framework and TOR, requires maintenance of a register of SEBI/CC technology circulars, and submission of audit reports- including management and Governing Board comments and exceptional non compliance formats-to Clearing Corporations within defined timelines. Auditor selection norms, independence requirements, CERT In empanelment, audit scope covering IT infrastructure, governance, security and BCP/DR, reporting formats with root cause and corrective-action timelines, and provisions for follow on audits/ATR verification are prescribed.

Special call auction with no price bands enables price discovery for eligible listed investment and holding companies.
SEBI introduces a special call auction with no price bands for ICs and IHCs whose scrips trade infrequently and whose six month VWAP is below 50% of per share book value based on listed investments. Eligibility requires uniform industry classification, at least one year listed without suspension, and at least 50% of assets invested in scrips of listed companies. Exchanges must give 14 day notice, disclose key price and book value information, coordinate sessions across exchanges, require at least five PAN based unique buyers and sellers for successful price discovery, and provide adequate risk management and surveillance.

Call auction duration changes require random closure and enhanced surveillance to curb pre-open session manipulation.
The pre-open call auction is prescribed as a one-hour session with segregated windows for order entry, matching and a buffer, and a system-driven random closure during the final part of order entry. Stock exchanges must implement enhanced surveillance with alerts based on specified cancellation and modification parameters, report alerts to the regulator by EOD, seek client explanations, and display cancelled order counts and quantities in real time. Risk management and margining requirements vary by issue size and scrip type, and exchanges must adopt systems and rule changes before the ninety-day applicability date.

Core SGF contributions: participants must provide risk based pro rata funding; LPCC replenishment and default waterfall govern recovery.
Participants who directly join LPCC must make risk based, pro rata contributions to the Core SGF equivalent to the MRC deficit after Issuer and Clearing Member contributions; LPCC may collect these upfront or staggered and must top up any shortfall until Participant contributions are received. Contributors must replenish Core SGF to MRC immediately after use, limited to one replenishment per 30 calendar day period from the date of default notice. The default waterfall prescribes an ordered loss absorption sequence culminating in capped additional contributions by non defaulting members/participants and, if necessary, pro rata haircuts to payouts, with conditions on resignation, caps, and regulatory approvals for haircut use and post haircut exits.

Employee bid cut-off rule revised: bids placed on T+1 must use the T-day cut-off, allotment based on T-day price.
Employees participating in exchange-based OFS shall place bids on T+1 day at the cut-off price of T day, and the allotment price will be based on the T-day cut-off price, subject to any discount. All other provisions of the prior OFS framework remain unchanged. Market Infrastructure Institutions must update systems, amend bye-laws where necessary, notify market participants, and implement the change within the prescribed implementation period.

Choice of nomination rules eased for existing investors as account freezing and payment restrictions are removed.
Non-submission of choice of nomination by existing demat account holders and mutual fund unitholders shall not lead to freezing of accounts or folios. Physical security holders may still receive corporate payments and access grievance or service requests even without nomination. New investors must continue to furnish choice of nomination, while intermediaries must encourage compliance through regular communications and login pop-ups, and only three fields are mandatory for updating nomination details.

Portfolio Managers must follow consolidated SEBI rules on registration, client funds segregation, related party limits, disclosures and reporting.
Master Circular consolidates SEBI guidance for Portfolio Managers, updating and superseding prior master circulars while preserving past actions. It prescribes online registration (Form A), Compliance Officer designation, net worth and certification norms, segregation of client funds, direct onboarding and distributor supervision, written policies for order placement and allocation, cyber security requirements for larger PMs, investment permissions including derivatives and co investment, prudential limits and client consent for related party investments, credit rating constraints, uniform disclosure and benchmarking of Investment Approaches, mandatory monthly/quarterly/offsite reporting to SEBI and clients, audited firm level performance reporting, fee and exit load rules, and grievance redressal obligations.