PRIM providers must apply for a certificate of registration and comply with conditions specified by the Board. Existing portfolio managers may be permitted to offer PRIM through segregated investment approaches, subject to the applicable regulatory conditions.

PRIM, the portfolio management service route for investment in mutual fund units, is governed by the dedicated framework in Chapter VI. Other provisions of the Portfolio Managers Regulations, along with related guidelines and circulars, apply on a mutatis mutandis basis unless inconsistent with the Chapter VI framework. Specified registration-related clauses, operational requirements, Chapters III and IV, and identified obligations and conditions are excluded from that general application.

Disputes, claims and differences between investors and portfolio managers arising from securities-market activities must be submitted to a prescribed dispute resolution mechanism, which may include mediation, conciliation and/or arbitration. A body corporate may be recognised to handle and monitor grievance-redressal processes.

Portfolio managers must appoint a compliance officer responsible for monitoring adherence to the Act and applicable notifications, guidelines and instructions, and for redressal of investor grievances. Eligibility is subject to Board specifications. The role cannot be assigned to the principal officer or the specified employee, and the compliance officer must immediately and independently report observed non-compliance to the Board.

Portfolio managers must provide the Board, whenever required, with information concerning portfolio management. Disclosure obligations extend to particulars previously furnished where changes may affect the certificate granted, the names of clients whose portfolios are managed, and particulars establishing compliance with the prescribed net-worth requirement. The disclosure framework concerns current information relevant to client relationships and financial eligibility.

Portfolio managers must rectify deficiencies identified in the auditor's report within two months from the date of that report. This requirement forms part of their general obligations and responsibilities, applies to auditor's reports within the prescribed audit-report framework, and imposes a defined timeframe for corrective action in response to audit-identified deficiencies.

Portfolio managers must provide periodic client reports at intervals not exceeding three months and whenever requested. Reports must disclose portfolio composition and value, transactions, beneficial interests, management expenses, foreseeable investment risks, debt-security payment defaults or default-rating downgrades, and distributor commissions attributable to the client. Client-specific reports may be provided through restricted website access. On termination, portfolio managers must give a detailed statement of accounts and settle the account under the contract; clients retain the right to obtain portfolio details.

Portfolio managers must maintain separate client-wise accounts recording funds, investment and disinvestment transactions, investment-related credits, expense debits, and tax deducted at source. Books of account require yearly audit by a qualified auditor to verify accounting methods, procedures, and legal duties. Portfolio accounts must undergo annual audit by an independent chartered accountant, with the certificate supplied to the client. Clients may appoint a chartered accountant to audit books and accounts relating to their transactions, and portfolio managers must cooperate.

Portfolio managers must comply with a minimum five-year preservation requirement for all books of account and the other records and documents covered by the relevant chapter. The specified materials must be retained for at least five years as part of the general obligations and responsibilities applicable to portfolio managers. The requirement extends to every book, record, and document falling within the chapter's stated scope.

Portfolio managers are required to furnish the Board with a net worth certificate issued by a chartered accountant whenever specified by the Board, as part of the general obligations and responsibilities applicable to portfolio managers. Submission is contingent on the Board's specification, and each required certificate must verify the portfolio manager's net worth through certification by a chartered accountant.

Portfolio managers must maintain financial statements, auditors' reports, statements of financial position, and other documents specified by the Board. Principal Officers must retain physical or digital records supporting each investment transaction or recommendation, including the data, facts, and opinion underlying the decision. Portfolio managers must disclose the location of maintained records and furnish financial and other required documents for the preceding five accounting years when required by the Board.

Parity in land-acquisition compensation requires a beneficiary that accepted and paid comparable awards for land acquired for the same project to maintain a consistent position. Denying similarly situated landowners equivalent compensation would constitute impermissible discrimination by a State instrumentality. Landowners are entitled to compensation at Rs.105 per square foot, with applicable statutory solatium and interest.

Every portfolio manager managing or administering securities must appoint a custodian in respect of those securities. Portfolio managers providing only advisory services are excluded from this requirement.

Foreign portfolio investors may avail portfolio management services from a portfolio manager under the Securities and Exchange Board of India (Portfolio Managers) Regulations, 2026. Eligibility to use these services is expressly extended to foreign portfolio investors within the framework of general obligations and responsibilities applicable to portfolio managers.

Portfolio managers must act under client agreements and may invest or advise in permitted securities, subject to Board-specified conditions for foreign securities, unlisted securities, and derivatives. Mutual fund investments must be made through direct plans without distribution-related client fees. Client-level prudential limits, credit-rating requirements, and alert-based monitoring apply, while investments in unrated securities of related parties or associates are prohibited. Client funds and securities must be segregated and safeguarded, with controlled aggregation, transfer, and securities-lending arrangements. Clients retain early withdrawal rights on termination, registration action, or portfolio manager bankruptcy or liquidation.

Portfolio managers act in a fiduciary capacity, must separately account for each client's securities and maintain client funds in a separate account with a scheduled commercial bank. They must not obtain undue benefits from client assets, borrow on a client's behalf, or lend client securities except as permitted. They must promptly redress investor grievances, value client securities under prescribed norms, report performance uniformly, and maintain policies and conduct controls for compliant management of client funds and securities.

Portfolio managers must enter into written client agreements, subject to specified exemptions, and obtain prior client consent for related-party or associate investments unless exempted. Before contracting, they must provide a certified Disclosure Document addressing fees, risks, conflicts, related-party matters, diversification, financial statements and performance. The document requires annual certification, updating, filing and website availability, with prompt addenda and client disclosure for material changes. Fees may be fixed, return-based or combined, but cannot include assured returns or upfront charges.

Portfolio managers must comply with the Code of Conduct specified in the Second Schedule as part of their general obligations and responsibilities under the Securities and Exchange Board of India (Portfolio Managers) Regulations, 2026.

Co-investment portfolio managers are generally subject, mutatis mutandis, to the Portfolio Managers Regulations, unless the context otherwise requires or application is repugnant to the co-investment framework. Specified provisions concerning Regulations 4, 6, 15, 16, 17, 19 and 27, together with identified sub-clauses of the Third Schedule, are excluded. The remaining provisions apply with necessary modifications.

Co-investment terms must not be more favourable to a co-investor than the corresponding investment terms of the Alternative Investment Fund. Exit terms, including exit timing, must be identical to those applicable to the fund, and early withdrawal is permitted only to the extent that the fund has exited the relevant investee company. All assets under management must be invested in unlisted securities of investee companies in which Category I or Category II Alternative Investment Funds managed by the same manager invest.