Revising Foreign Investment Norms in Alternative Investment Funds: A Critical Analysis of SEBI's Latest Circular

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....s (AIFs) The Securities and Exchange Board of India (SEBI), in its recent circular SEBI/HO/AFD/PoD1/CIR/2024/2 dated January 11, 2024, has introduced significant amendments pertaining to foreign investments in Alternative Investment Funds (AIFs). This article aims to dissect these amendments, understanding their implications and impact within the Indian financial landscape. Key Amendments and Le....

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....l Action Task Force (FATF) as having strategic deficiencies in Anti-Money Laundering (AML) or Combating the Financing of Terrorism (CFT). These conditions aim to align India's AIF investment regulations with global standards in combating money laundering and terrorism financing. Impact on Existing AIF Investors The circular specifies that AIF managers are prohibited from accepting further c....

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....hey enhance India's compliance with international standards in financial regulation, particularly in AML and CFT. This alignment is crucial for India's image as a responsible and secure investment destination, especially for foreign investors. However, the amendments also place additional compliance burdens on AIFs and their investors. It demands heightened due diligence and monitoring pro....