Sebi Eases FPI Disclosure Norms Amid Market Growth

The Securities and Exchange Board of India (Sebi) has increased the asset threshold for foreign portfolio investors (FPIs) to Rs 50,000 crore. This move, aimed at easing disclosure norms, responds to the growing market size and doubles the previous threshold to accommodate rising trading volumes in cash equity markets.

The Securities and Exchange Board of India (Sebi) has announced a significant change to the disclosure rules for foreign portfolio investors (FPIs), doubling the asset threshold to Rs 50,000 crore. This revision comes in light of the expanding market size, with cash equity markets seeing trading volumes more than double between FY 2022-23 and FY 2024-25.

FPIs that individually or as a group hold over Rs 50,000 crore in equity assets under management (AUM) in Indian markets must now provide detailed disclosures of all entities with ownership, economic interest, or control, adhering to a full look-through basis. This new framework is effective immediately, as confirmed by Sebi.

In addition, Sebi has provided exemptions for certain FPIs from additional disclosure requirements, including those with a broad-based, pooled structure and extensive investor base, or those involving government-related investors, contingent upon specific conditions. The size criteria aim to prevent the evasion of Press Note 3 guidelines by FPIs with substantial Indian equity portfolios that could potentially disrupt orderly market functions.

(With inputs from agencies.)