TaxTMI 
TaxTMI 
Operational Guidelines for Foreign Venture Capital Investors (FVCIs) and Designated Depository Participants (DDPs)
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....tions, it has been decided to issue necessary guidance in the form of operational guidelines (Annexure-1). 3. The provisions of this circular shall come into force with effect from January 01, 2025. 4. This Circular is issued in exercise of the powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 read with Regulations 3, 8, 9, 10, and 15 of FVCI Regulations to protect the interest of investors in securities and to promote the development of, and to regulate the securities market. 5. This Circular is available at www.sebi.gov.in under the link "Legal ---Circulars". Yours faithfully, Manish Kumar Jha Deputy General Manager Tel No.: 022-26449219 E-mail: [email protected] Encl: Annexure-1 Annexure-1 Operational Guidelines for Foreign Venture Capital Investors These operational guidelines ("guidelines") for Foreign Venture Capital Investors ("FVCIs") and Designated Depository Participants ("DDPs") are issued to facilitate smooth transition to the amended FVCI regime and operationalisation of the amended provisions of SEBI (Foreign Venture Capital Investors) Regulations, 2024 (FVCI Regulations"). Chapter 1 ....
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.... 1.2.4 The DDP shall be responsible for monitoring of compliance of FVCI with conditions specified above. 1.3 Transfer of Existing FVCI data to DDP 1.3.1 Upon engagement by an FVCI, the DDP may seek transfer of registration related information of the FVCI from SEBI. 1.4 Processing of application for registration by DDPs 1.4.1 FVCI applicant shall submit duly filled application form (Form-A) supported by required documents and applicable fees. The application form in original should be duly signed. If an application form is incomplete, or lacks clarity, the applicant shall be advised by the DDP to clarify or furnish the desired information within a reasonable time. 1.4.2 DDPs shall consider the following checks for determination of eligibility at the time of processing FVCI application: 1.4.2.1 Country Check - The residency status of the FVCI applicant maybe ascertained from the place of incorporation/ establishment through an appropriate document or information such as any identification / registration document issued by applicable regulator or the Income Tax authority. For due diligence, DDP may verify the country as below Table 1 S. No. Countries ....
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.... this suspension does not affect the entity or any of its affiliates' ability to trade in any other country around the world, DDP can consider such an applicant eligible for grant of registration subject to fulfilment of applicable eligibility requirements. 1.4.2.5 DDP shall mention name of its signatory(ies) in the FVCI registration approval while communicating registration approval to the FVCI. 1.4.2.6 DDP shall verify that identification of Beneficial owners is in accordance with Rule 9 (3) of PML Rules. ^1[ 1.4.3. A SWAGAT-FI FVCI applicant may apply for registration as FVCI together with application for registration as FPI, without filling application form or supporting documents. Such application shall be processed on the basis of information and documents submitted by the applicant for its application for registration as FPI. Provided the applicant appoints the same custodian and DDP for FVCI registration as appointed for FPI registration.] ^2[1.4.4 FVCI meeting the requirements for SWAGAT-FI FPI may convert to SWAGAT-FI FVCI on making an application to its DDP. Provided the FVCI appoints the same custodian and DDP for FVCI registration as appointed fo....
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.... application, the DDP shall ascertain the reasons for which the application was rejected. In case the application was rejected on technical grounds, the DDP shall ensure that such deficiencies have been rectified by the applicant, before assessing the application afresh on its own merits. If the application has been rejected for any other reason, then the DDP shall assess the application on its own merit as per FVCI Regulations. 1.7.2 DDPs shall maintain a database of FVCI applicants. DDP shall input the details of FVCI applicants in the database. Where an FVCI application is rejected by a DDP, the DDP shall mention the reason for such rejection in the database. 1.8 Reporting 1.8.1 Every DDP shall submit to SEBI, monthly reports on applications received from FVCI applicants as per the format specified in Annexure- 1A and such other reports as may be required by SEBI. The report pertaining to a month may be submitted by DDPs to SEBI through email at [email protected]. latest by 10th of the following month. 1.8.2 The DDP shall submit to SEBI monthly reports of the fees collected for all the FVCI registered by it as per the format set out in Annexure- 1B hereto throu....
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.... ii. the CP code is deactivated within 10 working days from the date of receipt of NOC from SEBI. 1.11 Change in DDP 1.11.1 In case, an FVCI or its Global Custodian wishes to change the DDP, the request for change shall be forwarded to new DDP. Such request from the Global Custodian on behalf of its underlying FVCI client(s) shall be considered only if such Global Custodian has been explicitly authorized to take such steps by the FVCI. 1.11.2 Upon receipt of no objection from the transferor DDP, the transferee DDP shall approve the change. In case, the request for change in DDP is received from Global Custodian, the transferee DDP shall inform Compliance Officer of the FVCI regarding the change in its DDP. 1.11.3 Once the change of DDP is approved by the DDP, the FVCI shall transfer accounts and assets, as the case may be, to the new DDP within a period of 30 days. In case the transition does not take place within the stipulated time, the FVCI shall provide reasons for the same and seek extension from DDP for a further period of 30 days. Once the transition is complete, transferee DDP shall intimate SEBI about the change. The new and old DDPs, shall provide j....
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....ed under Regulation 4 of FVCI Regulations unless the FVCI has been exempted from complying with the said criteria. 1.12.1.3 'Type II' material changes, i.e., any material changes other than those considered as 'Type I' material changes, shall be informed and supporting documents (if any) shall be provided by the FVCI as soon as possible and within 30 days of such change. 1.12.2 The DDP shall examine all material changes informed by the FVCI and re-assess the eligibility of the FVCI including requiring FVCI to seek fresh registration. However, the DDP shall mandatorily require the FVCI to seek fresh registration in case of 'Type I' material changes listed at sr. no. I to V of clause 1.12.1.2 above. 1.12.3 Where there is a delay in intimation of material change by the FVCI to the DDP, the DDP shall, as soon as possible but not later than two working days, inform all such cases to SEBI for appropriate action, if any, along with reason for delay. 1.13 Change in Status of a Compliant Jurisdiction 1.13.1 If a jurisdiction that was compliant at the time of grant of registration as a FVCI, becomes non-compliant subsequently, i.e. (a) ceases to be a member of IOSCO/ Bilateral....
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....cumentation Details 1 Applicant Level Constitutive Docs (MoA, COI, prospectus etc.) 2 Proof of Address^1 3 PAN 4 Board Resolution^2 5 FATCA / CRS form 6 Form/ KYC Form 7 Authorised Signatories List of Signatures^2 8 Ultimate Beneficial Owner (UBO) List of UBO including the details of Intermediate BO^3 9 Proof of Identity ^1 Power of Attorney having address provided to Custodian is accepted as address proof. ^2 Power of Attorney granted to Global Custodian/ local Custodian is accepted in lieu of Board Resolution. Board Resolution and the authorized signatory list is not required if SWIFT is used as a medium of instruction. ^3 UBO is not required for Government and Government related entities. Notes to the Table: i. FVCI shall provide an undertaking that upon demand by Regulators/ Law Enforcement Agencies, the exempted / relevant document/s would be submitted to the intermediary. ii. For non-PAN related KYC documents (including KYC form), a local custodian can rely on KYC carried out by another entity of the same financial group (like a Global Custodian or Investment Manager) which is regulat....
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....pository accounts in both NSDL and CDSL, it is allowed to appoint only one custodian. 2.5 Identification and verification of Beneficial Owners 2.5.1 Beneficial Owners (BOs) are the natural persons who ultimately own or control an FVCI and shall be identified in accordance with Rule 9 of the PML Rules. FVCIs are required to maintain a list of BOs and should provide such list of their BOs as below: - Sl. No. Name & Address of the Beneficial Owner (Natural Person) Date of Birth Tax Residency Jurisdiction Nationality Whether acting alone or together through one or more natural persons as group, with their name & address BO Group's percentage Shareholding / Capital / Profit ownership in the FVCI Tax Residency Number/ Social Security Number/ Passport Number of BO/ any other Government issued identity document number (example driving license) (Please provide any) i. Beneficial owners of FVCIs having General Partner/Limited Partnership structure shall be identified on ownership or entitlemen....
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....od wherein an intermediary, can access the information from KRA using the authentication (similar to One Time Password "OTP") after the KRA gets confirmation from the FVCI or its Global Custodian or Investment Manager. For this purpose, KRAs need to maintain email ids of the FVCI and/ or its representative. This functionality will be optional and it shall be de-activated only upon receipt of instruction from the FVCI to KRA. 2.7.2 The key features of the as below: a. Up to 3 email IDs of the FVCI can be recorded with 1 mandatory ID and 2 optional email IDs b. Download Consent Flag - Yes / No (Default value is set as "Yes") i. 'Yes' means Consent required for download ii. 'No' means download without consent c. Where Download Consent Flag is "Yes", an email with the consent link with decision tab "Approve" or "Reject", will be sent to the authorised representative of FVCI (as per the details updated in "a" above), requesting their consent to provide the KYC records to the requesting intermediary. d. KRA will send an email to the requesting intermediary that consent request email has been sent to the authorised representative of....
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....zed through the Power of Attorney (PoA). 2.9.7 In addition to information provided by the client, the intermediaries can rely on documents / information available from reliable public sources (for e.g. websites of Regulators, Exchanges, SROs, Registrars) while collecting documents / information required for an FVCI. Attestation of these documents (by way of mentioning the source of the document and signature against the same) may be carried out by a duly authorized official of the Intermediary. No further attestation of such documents is required. 2.9.8 List of people authorized to attest the documents: Notary Public, officials of Multinational Foreign Banks or any Bank regulated by Reserve Bank of India (Name, Designation & Seal should be affixed on the copy). 2.10 List of supporting documents: Proof of Address: - List of documents admissible as Proof of Address: (Documents having an expiry date should be valid on the date of submission.) i. Document specifying the address issued by any of the following: Central/State Government and its Departments, Statutory/Regulatory Authorities, Tax Authorities such as Passport, Driving license, etc....
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.... Account Number* 055501001994 Field 59 Account Name Securities and Exchange Board of India Field 70 Brief Purpose Regulatory / Auxiliary Fees Field 71A OUR Preferred as "OUR" 4. Or payment can alternatively be made through the following link https://eazypay.icicibank.com/eazypayLink?P1=aT7WlqPhtdfnIVJVERIrAg== 5. While making foreign remittances to SEBI towards FVCI registration fees/renewal fees, the following details may be filled in below mentioned filed: i. Field 59  Mention Beneficiary's Name, account number and their address. ii. Field 70  Mention Purpose of Remittance in the wire transfer message sent by the remitting bank (Registration fee/Renewal fee) iii. Field 71A  Mention ("OUR") in Field 71A of the swift message. Annexure -1C Information of intermediate material shareholder/ owner entity illustration: • FVCI ABC, a trust, is held 75% by XYZ Ltd. (intermediate material shareholder/ owner) - therefore XYZ needs to be identified and the identification of underlying individuals / non-individuals having controlling ownership interest in the FVCI or cont....