Vault manager registration and operational rules require infrastructure, gold standard compliance and controlled creation of Electronic Gold Receipts.
These regulations create a framework for registration and supervision of Vault Managers providing vaulting services for trading in Electronic Gold Receipts, specifying eligibility (corporate form, minimum net worth, financial security deposit, infrastructure and insurance), detailed operational duties (acceptance through accredited refineries, adherence to gold standard, storage in recognised vaults, creation of Electronic Gold Receipts only against physical gold, recordkeeping and reconciliation), procedures for creation and withdrawal of Electronic Gold Receipts via depositories, indemnity for depositor loss, inspection and audit powers of the Board, and enforcement under the intermediaries' regulatory provisions.

Service of notices and orders: expanded authorised modes including electronic delivery; failure triggers affixture and newspaper publication.
Amendment broadens authorised modes for service of notices and orders to include personal delivery, fax, electronic mail, electronic instant messaging services, courier, speed post and registered post; electronic communications must be digitally signed and bounced mail does not constitute valid service, while fax transmissions must note page count. If service cannot be effected, notices or orders may be affixed to the outer door or a conspicuous part of premises with a written report in the presence of two witnesses; failing that, notice must be published in at least two newspapers including an English national daily and a regional language paper in the relevant area.

Service of notices expanded to include electronic delivery with digital signature, affixture and newspaper publication as alternatives.
Rule 7 prescribes service of notices and orders by personal delivery, authorised agent, fax, electronic mail or instant messaging, courier, speed post or registered post to residence, last known residence, place of business or work; electronic communications must be digitally signed and bounced email is not valid service. Failing service by those modes, notices may be affixed on the premises with a written report in presence of two witnesses, and if affixture fails, notices shall be published in two newspapers including an English daily and a regional paper in the local language.

Service of notices: amended to permit electronic delivery with digital signature and alternative affixture and newspaper publication.
Amendment replaces rule on service to allow personal delivery or to an authorised agent, and service by fax, electronic mail, electronic instant messaging services, courier, speed post, or registered post to the person's residence, last known residence, or place of business or employment; fax must note transmission and page count for annexures; electronic communications must be digitally signed and an email bounce does not constitute valid service. Failing these modes, a notice may be affixed at the premises with a written report in presence of two witnesses, and if affixture fails, the notice must be published in two newspapers including a nationwide English daily and a regional language paper where the person was last known to reside or carry on business.

Electronic Gold Receipt declared securities, bringing receipts based on deposited physical gold into securities regulation.
Declaration that Electronic Gold Receipt constitutes securities under the Securities Contracts (Regulation) Act, defined as electronic receipts issued on the basis of deposit of underlying physical gold in accordance with regulations made by the Securities and Exchange Board of India.

Delisting via open offer: acquirer may seek delisting if intention is declared upfront and regulatory conditions are met.
Amendments permit an acquirer who announces an open offer to also make a delisting offer if the intention is declared upfront; eligible acquirers must not be promoters, persons in control, associated with promoters, or holders above specified thresholds, and must disclose both the open offer price and an indicative delisting price (with rationale and minimum book value). If the delisting threshold is met, tendering shareholders receive the indicative price; if not, they receive the open offer price. Failed delisting, competing offers, withdrawal rights, further delisting attempts when non public holdings exceed limits, scale down options to retain listing, and related disclosure and timing rules are provided.

Fit and proper person criteria tightened for intermediaries, affecting eligibility, ongoing compliance and replacement obligations.
The substituted Schedule II prescribes competence, capability and financial soundness requirements and applies fit and proper person criteria to applicants, key officers, directors and controlling persons (including 20%+ voting rights in unlisted entities). The Board may consider integrity and specified disqualifications-such as pending criminal complaints, economic-offence chargesheets, restraint/debarment orders, recovery or winding-up proceedings, insolvency, unsound mind findings, wilful defaulter status, fugitive economic offender designation and convictions for moral turpitude-and may render persons ineligible for registration. Intermediaries must replace disqualified key persons within thirty days or ensure divestment/cessation of voting by controlling persons within six months; criteria apply at registration and during continuance.

Co-investment Portfolio Manager status established, with tailored exemptions and AIF-aligned investment and exit rules.
Creates a Co-investment Portfolio Manager category for Managers of Category I/II AIFs who serve only investors of such AIFs and invest solely in unlisted securities of the same investee companies; aligns definitions with AIF Regulations; permits designation of a Key Investment Team member meeting AIF principal-officer criteria as principal officer. Carves out specified regulatory requirements for Co-investment Portfolio Managers, requires 100% of AUM to be invested in relevant unlisted investee companies, mandates that co-investor terms and exit timing be no more favourable or different from the AIF, and allows performance calculation as agreed with clients; updates Form A and disclosure provisions accordingly.

Co investment rules: terms and exit parity required; certain category fund investment limits and advisory restriction apply
Amendments define Co-investment and require that co-investments by Managers, Sponsors or investors of Category I and II funds be through a Coinvestment Portfolio Manager; co-investment terms must not be more favourable than the Fund's terms and exits must be identical for co-investments made after commencement. Category III funds face caps on investment in listed equity and in non listed securities of an investee company, with higher limits permitted for large value accredited investor funds. Managers are barred from advising investors on investee company securities except clients of the Coinvestment Portfolio Manager.

Silver exchange traded fund scheme: permits investment solely in silver instruments with custody, liquidity and valuation rules.
Introduction of silver exchange traded fund scheme permitting schemes that invest primarily in silver or silver related instruments, with custodial amendments allowing registered custodians to hold silver assets. Moneys collected must be invested only in silver or silver related instruments except for disclosed liquidity needs; pending deployment, funds may be held in short-term bank deposits. Recurring expenses expressly include storage and handling of silver. Valuation of silver is tied to the LBMA AM fixing price with metric and currency conversions and additions for transportation, handling and notional duties or a notional delivery premium.

Related party definition and transaction rules broadened; audit committee approvals and periodic disclosures strengthened under listing regulations.
The Regulations expand the related party and related party transaction definitions to include promoter group and substantial shareholders and transactions that benefit related parties; they add exclusions and specify staged applicability. Audit committees must approve related party transactions and subsequent material modifications, define "material modifications", and prior approval is required for certain subsidiary transactions based on turnover thresholds with transition rules effective from April 1, 2023. Listed entities must disclose related party transactions in a Board specified format every six months aligned with financial results, and a loans disclosure to firms/companies where directors are interested is mandated except for listed banks.

Foreign Portfolio Investor eligibility: resident Indian entities permitted as constituents of IFSC AIFs with sponsor/manager role and capped contribution limits.
The amendment permits resident Indians (other than individuals) to be constituents of Foreign Portfolio Investor applicants where the applicant is an Alternative Investment Fund established in an International Financial Services Centre and regulated by the International Financial Services Centres Authority, provided the resident entity is a Sponsor or Manager. Contributions by such resident constituents are capped and determined as the lower of a fixed percentage of the applicant's corpus or a fixed monetary ceiling, with different caps for Category I/II and Category III Alternative Investment Funds. A minor punctuation correction is also made.

Qualification requirement updated: inclusion of practicing Cost Accountant alongside practicing Company Secretary for Depositories Regulations.
The amendment inserts the words "or a practicing Cost Accountant" after "practicing Company Secretary" in sub regulation (1) of Regulation 76 of the Depositories and Participants Regulations, 2018, thereby recognising practicing cost accountants alongside practicing company secretaries for the specified regulatory purpose; the regulation takes effect on its publication in the Official Gazette.

Net worth limit for SR shareholders establishes valuation and holding criteria for eligible pre-issue shares under amended ICDR regulations.
The amendment requires an SR shareholder's individual net worth to be determined by a Registered Valuer and capped at a specified upper threshold, counting investments in other listed companies but excluding the shareholder's holding in the issuer; it also mandates that SR equity shares be issued before filing the draft red herring prospectus and held for at least three months prior to filing the red herring prospectus.

Renewal of recognition to clearing corporation granted for one year, conditioned on compliance with regulatory requirements.
Grant of recognition to Metropolitan Clearing Corporation of India Limited is authorized for a one year term from 3 October 2021 to 2 October 2022, exercised under statutory regulatory powers and declared to be in the interest of trade, the securities market and the public, and is expressly subject to compliance with conditions specified by the regulator and any further conditions that may be prescribed or imposed thereafter.

Renewal of recognition under securities regulation granted to Metropolitan Stock Exchange, subject to SEBI-prescribed compliance.
Renewal of recognition is granted to Metropolitan Stock Exchange of India Limited under Section 4 of the Securities Contracts (Regulation) Act, 1956 for one year from 16 September 2021 to 15 September 2022 in respect of contracts in securities, subject to compliance with conditions as may be prescribed or imposed by SEBI from time to time.

Certification requirement: Portfolio manager principal officers and fund decision-makers must obtain Portfolio Managers certification within specified periods.
Regulatory notification requires principal officers and employees with decision-making authority in fund management at Portfolio Managers to obtain the Portfolio Managers Certification Examination specified in the referenced communique . Portfolio Managers must ensure current associated persons obtain the certification within the transitional period and must ensure new hires obtain certification within the shorter period applicable to post-notification employment. The obligation is issued under the applicable certification and portfolio manager regulations and comes into force upon publication in the Official Gazette.

PMS distributor certification requirement: associated persons must obtain NISM-Series-XXI-A certification within prescribed transitional and employment timelines.
Associated persons acting as distributors of Portfolio Management Services must obtain NISM-Series-XXI-A: Portfolio Management Services (PMS) Distributors Certification. Portfolio managers must ensure existing distributors comply within the notified transitional period and newly engaged distributors obtain certification within the employment-linked period. Exemptions apply for holders of a valid AMFI Registration Number (ARN) or NISM Series-V-A certification for the duration of those credentials' validity. The notification is effective upon publication in the Official Gazette.

Corporate governance for high value debt listed entities updated: expanded disclosure, quarterly reporting and trustee obligations.
Amendments align definitions with the Issue and Listing of Non-Convertible Securities Regulations, 2021 and extend listing obligations to non-convertible securities; introduce the category of high value debt listed entity subject to corporate governance provisions on a phased basis; mandate enhanced quarterly financial reporting, expanded disclosure metrics and website hosting of disclosures; require debenture trustee notifications, Directors and Officers insurance for independent directors of high value debt listed entities, and prescribe escrow treatment and eventual remittance for unclaimed interest/dividend/redemption amounts.

Aggregate shareholding disclosure: acquirers and persons acting in concert must report at the prescribed threshold; depository encumbrance exempt.
Regulation 29 is amended to require acquirers, together with persons acting in concert, to disclose their aggregate shareholding and voting rights in a target company upon reaching the prescribed threshold; regulation 30 is omitted; and regulation 31 is amended to exempt encumbrance disclosure where the encumbrance is undertaken in a depository. The amendments take effect from April 1, 2022.